Proof that Trump’s “Wage Is Too High” Comment Is Plain Wrong
No shock, Donald Trump said something silly during the presidential debate Tuesday night. But this time his comment touched on something that we know about: employee engagement.
Asked what he thinks about increasing minimum wage to $15 per hour, Trump balked (as did the other candidates), and then said this:
“We are a country that is being beaten on every front — economically, militarily. Taxes too high, wages too high, we’re not going to be able to compete against the world.”
Like it or not, workers like to earn money, and they like to get pay raises. It’s a key component of employee engagement. Employees need to be rewarded for completing big projects or taking on more responsibility.
In our 2015 Employee Engagement Report, we discovered one alarming fact directly related to pay. Nearly one-fourth of workers say they would quit their current job for just a 10% raise. What does that mean? Workers want to know that they can earn raises, and if they can’t, they might quit. (That also speaks to larger issues of engagement, but that can vary between workplaces.)
Increasing wages can actually save money. An often-cited Center for American Progress study showed that it can cost as much as 20% of an employee’s salary to replace them. For a worker earning $50,000, you could keep them employed for another year for half of what it would cost to replace them.
- Higher minimum wage could reduce turnover by 24%
- Between 2004 and 2014, median wages in the U.S. have been essentially flat
- Dan Price, Gravity Payment’s CEO, who increased minimum wage at his company to $70,000? Revenue doubled
Wages too high already? If Trump thinks that’s true, he should probably start by cutting his own salary.