In making the case for a higher minimum wage, John Carver used the example of Henry Ford giving his employees more than double the going wage at the time. As a result, both the company and the employees prospered greatly. (Des Moines Register 1/28/14 – “Higher wages will benefit companies today”) What was not mentioned was that Henry Ford was able to pay his employees so much because his company was many times more productive than any of his competitors at that time. Even at the higher wage he could produce a better product at a lower price. Today, we are not necessarily any more productive than the countries around the world that we compete with. We can only pay higher wages on a sustainable basis if we are actually more productive. Today, an increase in the minimum wage will result in higher wages for those whose are lucky enough to keep their jobs. Others will lose their jobs due to outsourcing or automation or because people won’t buy the products or services they produce at the higher price.
Link to Register article: http://www.desmoinesregister.com/apps/pbcs.dll/article?AID=2014301290020