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Pressure in wages

Is it more important for a company to have a bigger profit or is it more important for companies to save their employees financial lives?

 

Early indication about wage pressure have begun in recent years, making it to be a headline of most of the big companies that are facing this issue and that will need to take an action to it.

 

However, with the combination of the U.S payrolls, and political pressure to increase both state and federal minimum wages and other industry issues such as labor shortage in construction, could hopefully increase the labor cost.

 

As an analysis shows, that wages that have started growing up a year ago in some industries such as fast food restaurants and retailers have continued to grow and spread to different companies that goes under the same industry.

 

As Wal-Mart mentioned that by the next year comes, earnings will reduce to 12 percent due to the increasing entry-level wages, furthermore, employees are fighting against it. What do you think Wal-Mart should do with it?

 

Another example will be Shake Shack, which had the same issue, and what they have done is that they had to increase the prices in their menu.

 

The question is, are low rates curing or damaging the economy? As the previous records have shown that low rates have been shown, and there were no financial lives issues.

 

Source:

http://www.cnbc.com/2015/11/20/wage-pressures-coming-us-companies-start-to-sound-the-alarm.html

About Mohammed Alzaini

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