By Adam Uzialko
Business.com, July 16, 2025
Paying a “living wage” requires more than meeting state and federal minimum wage requirements. Living in certain communities is more expensive and requires people to earn more to sustain basic life necessities. As an employer, paying a living wage can feel like a burden to the bottom line, but it can be a powerful investment in your people that positively affects business outcomes. ...
“When you’re setting something like the federal minimum wage, you want to consider the averages,” said Holly Sklar, CEO of Business for a Fair Minimum Wage, an advocacy group that supports gradually raising the floor. “When talking federally, it’s a floor that’s adequate for the country as a whole. When you’re talking about an individual or city or a state, you look closer to home to determine what is a living wage.” ...
Offer a living wage to benefit businesses and the economy.
Sklar and her organization believe offering a living wage (and indeed raising the mandated minimum wage) will yield the most positive outcomes for individual businesses and the economy at large. Sklar thinks that customer service tends to be significantly better when wages are higher, resulting in a happier, more loyal customer base.
“We know that frontline employees often make the difference between repeat customers and lost business,” she said.
Sklar also points to the long-term benefits of paying employees more ... in retaining employees, boosting morale and increasing long-term productivity.
“One of the things our business members stress is looking at the whole picture,” Sklar said. “Low pay often means high turnover … And with a reduced turnover [due to higher pay], businesses often see substantial savings in recruiting and training costs.
“There are also savings from managers able to spend time on more productive tasks, as well as less product waste through lower error and accident rates,” she added. ...