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$70k Salaries Didn't 'Backfire'; Gravity Payments' Profits Have Doubled (inc.com)
AmiMoJo writes: In April, Dan Price, CEO of the credit card payment processor Gravity Payments, announced that he will eventually raise minimum pay for all employees to at least $70,000 a year. The move sparked not just a firestorm of media attention, but also a lawsuit from Price's brother and co-founder Lucas, claiming that the pay raise violated his rights as a minority shareholder. But six months later, the financial results are starting to come in: Price told Inc. Magazine that revenue is now growing at double the rate before the raises began and profits have also doubled since then. On top of that, while it lost a few customers in the kerfuffle, the company's customer retention rate rose from 91 to 95 percent, and only two employees quit. Two weeks after he made the initial announcement, the company was flooded with 4,500 resumes and new customer inquiries jumped from 30 a month to 2,000 a month.
Not long a pizza chain local to the Minneapolis area raised their starting wage to $11/hour and they've seen tangible rewards from doing this.
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
So success is staying in business for 6 months? LOL, good luck with your "success" then.
"File to fit, pound to insert, paint to match" - Aircraft Maintenance 101
While that is undoubtably a factor, as TFA acknowledges, the point is that the previous reports of it being a disaster are wrong. Two people left, and they attracted a lot of new talent, and the company didn't tank. The predictions of dire woe never came true.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
I am not a fan of my generation's idea of a high minimum salary. I don't earn 70k a year. And I certainly don't, absolutely, have to have it. 'cause I'm not buying lifted trucks, dropping $2,400 a month on a mortgage... and I didn't go to a college that would charge me $100k for the degree. In fact, I have enough money to pay off my student loans now, and I would be debt free -- completely.
You're on the right track, but still a bit naive. Here are some rough numbers for a family of two in my city:
70k - taxes = 49k
49k - health / vision / dental insurance = 45k
45k - 1 car loan = 42k
42k - single car insurance for 2 drivers = 40k
40k - moderate mortgage = 22k
22k - plan with 2 smart phones = 19.6k
19.6k - utility bill (water, gas, electricity) = 16.6k
16.6k - food = 10.4k
10.4k - gasoline = 8.8k ($30 / week)
8.8k - tv / internet / landline = 3.6k (triple play = 100 / month)
3.6k - property tax = 2.4k
2.4k - vehicle registration = 2.2k
That gives you $183 / month for clothing, emergencies, etc.
Now throw in the fact that an average vaginal birth costs 15k before insurance (6k after), but you can generally finance for up to 4 years. A box of 150 diapers costs $40 at Costco. At about 8 diapers per day, that lasts for 2 weeks. A month old baby drinks approximately $35 of formula per week (assuming no breast feeding). A crib and mattress cost $200-350. A baby outgrows its clothes very quickly (newborn, 3 month, 6 month, 9 month, 12 month, 18 month, 24 month). The least expensive day care I can find charges $5 / hour -- higher than minimum wage after taxes. It is now estimated to cost $250k to raise your child to the age of 18.
Does 70k / year really seem that high now?
It's no wonder you have problems.
Seriously, $2400 ($200/month) for 2-phone plan? Mine is $70 for two iPhones with unlimited talk, text, and shared 4G of data (we've got wi-fi everywhere so why pay for 10G or more?).
And $100/month for the triple play is not bad, but that adds up to only $1200, not the $5200 you deducted for it.
And if you can't afford all the expenses of having a kid on top of the other things you're spending on, perhaps you ought rethink the decision to have one. Or maybe you could cut the TV and landline if you need to buy diapers.
Right, because when you change one thing, everything else has to stay the same, otherwise things would get to complicated to discuss in a post like yours.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
First, per capita is not per worker. There are children, retirees, and even spouses that do not work.
Second, the US economy is closely tied to consumer spending, so giving a raise would boost the GDP. (Figuring out what the ratio of increased wages to increased GDP would be is left as an exercise for the student.)
The tiny increases in wage rates since the recession is an important factor in explaining why the GDP is expanding so slowly now.
The reason for $70,000 and not $70 billion is because the Princeton study he based the decision on said that making more than $75,000 didn't make people happier on a daily basis but that making less than $75,000 increase how unhappy people were.
Thus by decreasing his own salary and increasing the minimum wage at his company (but not completely eliminating the pay scale) he figured he could increase overall productivity while also being ethically responsible. It seems to have paid off.
Obviously that would differ depending on the cost of living in a region. I assume that number he quoted is specifically calculated for Seattle.