Monday, May 18, 2015

WORKERS - Better Pay = Better Business?

"Do better-paid workers equal better business?" PBS NewsHour 5/14/2015


SUMMARY:  Recently, insurance company Aetna voluntarily upped its minimum wage to $16 per hour, giving roughly 6,000 of its lowest-paid employees an average raise of 11 percent.  Next year, the company also plans to offer lower-cost benefits to some workers.  What’s behind the wage hike?  Economics correspondent Paul Solman talks to Aetna's CEO about the investment.

KENDRICK BROWN, Aetna Customer Service Representative:  There are necessities and then there are wants.  You know what I mean?

PAUL SOLMAN (NewsHour):  Forget his wants.  Health insurance claims servicer Kendrick Brown has barely been able to afford life’s necessities, like a car, after his was totaled.

KENDRICK BROWN:  I actually got in an accident.  My insurance paid off what the car was worth, but, as far as what I had borrowed to actually purchase the car, I still owed.  Once you get in such a hole, you’re like, OK, would it make more sense for me to actually, you know, file bankruptcy?

PAUL SOLMAN:  So, when his employer, Aetna insurance, recently, voluntarily and suddenly raised its minimum wage to $16 an hour.

KENDRICK BROWN:  It was a happy day.  After taxes, it was like somewhere between $100 and $150 dollars every check.  And that goes a long way.  That goes a long way.

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