Benefits of Minimum Wage Raising

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This essay has been submitted to us by a student. This is not an example of the work written by our writers.

Since 1998, the National Minimum Wage has merely increased from £3.60 to £7.83 per hour – that is only a £4.23 increase over the past two decades. Imagine how you would feel, earning so little after working long, hard and exhausting shifts in order to keep your family financially afloat – inconceivable is it not? This is a reality for many around us, struggling from one day to the next: exhausted, with little to show for it. Should all those hard-working members of society be treated so poorly after all their efforts?
With the world so vastly evolving from one day to the next, everything is becoming more and more expensive. Over the last few decades, the price of simple items – such as bread and milk for example – have risen to new heights, causing those who struggle to barely afford the necessities.
During the early nineties, a loaf was being sold for as little as seven pence as supermarkets battled damaging price wars, however, in today’s stores these slices of wheat are being sold for up to almost sixteen times this amount. It is not just the day to day items that have risen in costs, due to inflation prices of housing is going up, tax and even bills, for those caught up in the National Minimum Wage scandal, this is a nightmare. On its own, the National Minimum Wage act has caused a large amount of poverty throughout the entirety of the UK, with almost seven percent of all jobs being paid through this scheme.
As the cost of living increases, people’s wages are being stretched further and further – forcing some to live life in shelters or possibly on the street, this contradicts the government’s intentions as they claimed that this act should resolve problems such as this. A simple yet effective solution to this scenario is that minimum wage increases, this would further minimise the percentage of those struggling to cope daily life as necessities and vital items could be much easier afforded. From a study conducted by the Low Pay Commission, a fall in poverty throughout the UK was found after previous minimum wage increases. Should those who contribute to society day in day out struggle due to financial situations? The answer is too obvious to point out.
A company cannot run without employees, employees cannot work without a motive – wages. It is a known fact that when employees are paid well, their mental and physical health improves, this leads to an increase in productivity and performance from these vital individuals as they are happier and motivated to use and improve their skills in the workplace. It is not only the employees in which benefit from a greater increase in wages such as the National Minimum Wage, but the business owners and management teams also, having staff who are happy, motivated and perform at a high level of work ethic creates an image of corporate social responsibility and ethics towards the business as a whole.
This is the reason several organisations – even those who operate in sectors and industries which low pay is expected – have been paying more towards these workers, however, this voluntary stage could be eliminated and save businesses capital if the National Minimum Wage was to increase, employees would still be happy and motivated, and organisations would have more finance to spend on researching and improving the world that we live on. These employees also have a higher chance of having a healthy family and home relationship and are more likely to continue in career advancements in the workplace, contrasted to those which leave the organisation as soon as a better offer arises.
This benefit allows employers and management staff to recruit and train employees internally (those already in the business), which is less risky and cost-efficient. This change would also lead the front for a decrease in unemployment as in years following all previous minimum wage increases have shown this, this is possibly due to people being introduced to a new motive of higher wages, resulting in a more positive life. It is estimated that today only 4.8% of those sixteen and over are out of employment, compared to statistics from the closing months of 2013 where an astounding 8% are unemployed. These national minimum wage increases from previous years have been beneficial to more than individuals themselves, but also our society. Why should we not continue in these advancements, containing more positives than negatives?
Many communities within the UK can be described as working-class, this phrase generally entails those in which work in a job being paid the National Minimum Wage. One in twenty people living in the UK are paid this amount, however, in communities like these, this percentage greatly increases.
From previous increases in this government-issued scheme, these communities and much other like this have been known to gain and maintain a level of social stability between them. This benefit further leads on to employers not having to deal with the troubles of a high turnover and the effects of employees leaving to find work with better elsewhere, in turn stabilizing communities and benefiting all who live there. This is due to members of Britain’s ‘low-paid army’ (a hurtful and derogatory phrase) being more likely to stay in their current jobs.
When comparing the UK’s National Minimum Wage to that of any other country, there are several factors to take into account: living costs, inflation and housing costs to name a few. In a study completed in 2016, it was shown that the UK had the ninth highest NMW when put against another twenty-six OECD countries (those which are members of the Organisation for Economic Cooperation and Development).
Counties such as Belgium, Luxembourg, and Australia overtake the United Kingdom in this aspect of society. These countries and others like it have much lower unemployment levels, with Germany and the Netherlands having two of the lowest with 3.4% and 3.9%, and are seen as better countries to live in. Another benefit of a greater minimum wage is an increased amount of wages, leads to an increased amount of spending – this raises the demand for new jobs to be created, leading to a downfall in unemployment, this factor can be seen in the previous statistics with Germany and the Netherlands alike. The rate of poverty in countries in countries with higher minimum wages is also drastically different when contrasted to that of a country with a lower one.
For example, poverty rates in Canada reach roughly 13% of the population, compared to a whopping almost 20% in the United Kingdom alone. These statistics clearly show that an increase in minimum wage is substantial and long overdue. These benefits are widespread and will affect everyone under the regime, resulting in a greater image and decrease in negative factors as a whole.

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