How Small Businesses Can Survive the Impact of Minimum Wage Hikes

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The recent bill signed into law by Gov. Jerry Brown raising California’s minimum wage to $15-an-hour has speculations going on regarding its pros and cons. While it could boost pay and help workers cope with the higher cost of living, economists said that it can also lead to serious job losses.

How Small Businesses Can Survive

This economic impact of minimum wage hikes to phase in over the next six years (2022) has also met opposition from business groups who claim that it would reduce employment opportunities for low-skilled Americans.

However, some economists argue that businesses can still adjust for higher costs through improved productivity at work, reduced turnover, and price increases.

One of the ways to cut on labor cost is to utilize and hire an online remote worker or virtual assistant (VA) for businesses and professionals.

[Tweet “Using a #VA is a cost-effective solution—saves you 70% on labor cost.”]

Think about it. VAs don’t need your office space, power, or equipment because they are working from their homes. Plus, you get rid of the need for payroll taxes, overtime and vacation pay, health insurance, and other employee benefits.

Outsourcing your business processes not only reduces your own costs but also your workload, increase your sales, and gain more customers. Virtual assistants can handle back-office tasks for as low as eight bucks per hour depending on skills and experience.

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Tasks VAs Can Help You With:

  • customer service
  • appointment setting, telemarketing, sales
    administrative or personal assistant
  • real estate agent / investors assistants
  • accounting, bookkeeping, QuickBooks
  • online marketing (social media, SEO, ads posting – Craigslist, etc.)
  • web design, programming, web maintenance, system administration
  • transcriptionists
  • create marketing materials – videos, flyers, newsletters, promos, etc.

Now that the cost of labor is so high, it would likely be very difficult to run a profitable business for the years to come. The $15-per-hour minimum wage sure provides raise to some workers, but also puts businesses at a disadvantage.

As Michael Saltsman, research director at the Employment Policies Institute, stated:  “When you talk about these really massive jumps it’s no longer an impact at the margin, it’s the sort of thing that could be the difference between a business staying open and closing.”

As the minimum wage escalates year after year, it will be harder for employers to afford to pay workers. In order to survive,

[Tweet “Businesses need to be smart in hiring workers w/out sacrificing quality output.”]

References:
http://www.ibtimes.co.uk/california-new-york-sign-into-law-bill-raising-minimum-wage-15-hour-1553217
http://www.ibtimes.co.uk/california-lawmakers-unions-reach-15-hour-minimum-wage-deal-1551803
http://abcnews.go.com/US/wireStory/california-aims-raise-minimum-wage-15-hour-37986906

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