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This story seems silly. Person A is not going to put all those savings into the renovations -- they'll pay the builders the lowest amount to get the job done to
by 8note 6y ago
This story seems silly. Person A is not going to put all those savings into the renovations -- they'll pay the builders the lowest amount to get the job done too. Person B will also have enough savings to do a good quality renovation.
But what you've described is that it's not a fiscal imperative. That's why it is a moral imperative - it's the right thing to do for your employees.
Mind you, the Henry Fords of the world would say your business does better when everyone pays their employees more because they can afford more hotel trips, and the results of Ford raising his wages shows a very different result from what you've described.
- lotsofpulp 6y agoThe point is the person spending less on labor will have more to purchase more desirable land with, or build new hotels, or renovate with better materials. And most importantly, they will get to borrow much more since $100k extra in profit means $500k+ in borrowing capacity more than the business that spent it on payroll. Henry Ford wasn’t making a commodity product at the time he offered those wages. Since then, automakers have dropped pay and payroll, see the myriad economically depressed towns where’s work moved to Mexico or southern states.