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Dip in Minimum Wage Brings Down Income and Morale

Another Sign of the Times

Just when you thought the economic news could not get much worse, news that Colorado will be dropping its minimum wage comes through. According to a recent story from the Associated Press, the state is lowering the minimum wage by 3 cents per hour this year. While this amount may seem insignificant, it takes a toll on the moral of lower paid workers, even if their bottom lines are not much lower. The change leaves workers to wonder if they will ever be able to afford any luxuries and if all of their hard work will ever get them ahead.

Why the Change?

In order to keep up with inflation, Colorado, along with nine other states, have their minimum wage pegged to cost of living. This is intended to shield lower paid workers from being unable to cope with rising costs on necessities. Unfortunately, using this system also means that when the economy takes a dip the minimum wage falls with it too. The minimum wage in Colorado will now be $ 7.25 per hour, which is as low as it can go because it has now hit the federal minimum and cannot drop below that. This is small consolation for those whose already low wages will be going down. It can be tough enough knowing that you are already working for the lowest amount in the state, but for that amount to drop further can be hard on the self esteem, even if the decrease is only a few pennies per hour.

The Good News

Labor officials in the state are fairly confident that the majority of employers who pay minimum wage will continue to pay employees the previous amount. It stands to reason that if some employers maintain wages for their employees, others will follow. If an employer decides to drop down to the new minimum wage, he might be risking losing staff to other jobs. Employers should bear in mind that lowering wages might preclude them from keeping all their employees, and their savings might end up being minimal at best. Though the difference in wage isn’t significant to the end result, a forced pay cut can undercut an employee’s perceived worth, and create a negative division between labor and management.

Buying some Good Will

If an employer is willing and able to pay just a few cents more than his competitors it can certainly create a more harmonious workplace. Employees tend to feel valued and appreciated and are more likely to remain loyal to the company when they make a little more than others in the same field. A higher wage gives a person a greater sense of self worth in their job, and therefore incentive for effort. Particularly in today’s economy, no one wants to be out looking for a new job, so if an employee is relatively satisfied with her position she will likely stick around. Paying a little bit more can help keep employees around and keep them happy.

There is Help if You Need it

If you are one of the many who is working a minimum wage or part time job right now it can be tough to make ends meet. Unexpected costs could come up before payday. In such a case it may be a good idea to look into a payday loan for some quick cash to get you through.