Paying livable wages saves a lot on constant training

You mean like paying your employ's more that the revenue they can generate for you and not being able to make ends meet?

Ford paid his employee's more so he could keep them long enough to train them and thus increase productivity enough to make more money than paying people less.

But if the job is something like flipping burgers, the company might not have high enough margins to make bank and pay high wages.

Some years back, McDonald's decided to test your burger analogy. They started with an across the board raise of $1-$2 an hour at some of their corporate stores. They ran the test for over a year, and here's what there findings were.

Turnover was greatly reduced in these stores. Every time someone quits, someone new has to be trained, and, even training someone to flip burgers. It costs a company just over $1,200 to train a new employee. Employee turn-over rate in fast food is ~150%. Say a store has 30 hourly employees, that means by the end of the year, they've had to shell out $54,000 in training people "how to flip burgers."

The extra buck or two an hour eliminated constant training new people, because employees stuck around. The longer they worked at the store, the more motivated they were and the better they became at their jobs. People that are good at their jobs seem to get orders correct more often. This caused a reduction in customer complaints. Food was not only cooked properly, but orders were put together correctly. You've seen it, you order something, get home and discover your supersized order wasn't supersized.cutting back on customer complaints allowed the manager to do his/her job better, focusing on managing! The really crazy part? Revenues increased. All the other fast food joints in the area that used YOUR business model started losing business! Who wants to do business with a group of screw-ups? People grabbing a quick lunch? Where they may have done BK one day, McDs the next, Wendy's the third, Little Caesars on the fourth, and somewhere else on the fifth, started hitting McDs nearly every day. And it wasn't just the lunch crowd! The breakfast crowd and dinner crowd were coming in droves because they knew their meals would be cooked right and and served correctly. Well trained and experienced workers show customers you care about them and your business.

Revenues increased about 50% within the first 6 months. Training costs were all but eliminated, turn over rates were down, employee morale was way up, and customer satisfaction was through the roof!

Remember, your employees don't care if you make a profit if you don't pay them a livable wage. Minimum pay means minimum effort.

1 or 2 dollars is a lot different from 7.

Yeah, that extra buck or two really got them motivated.