Minimum wage hike incentivises mechanisation

Case study 1: friend who grows capsicums has gradually been mechanising the processing as technology improves and money allows.

It improves efficiency and lowers costs.

It also requires less labour and he says the minimum wage hike which is being imposed on employers by the government will increase the costs savings and incentivise him to increase mechanisation.

Case study 2: a company which picks and packs fruit has a lot of problems getting enough reliable staff when it needs them, even with the Recognised Seasonal Employment (RSE) scheme.

The hike in the minimum wage provided the incentive to mechanise further. The process which needed 24 workers now needs only 4.

Most employers accept that regular increases to the minimum wage and the flow-on effect on higher wages is the cost of doing business.

Most cope when the increase is modest.

But the jump in the minimum wage to $20 is considerably more than modest and providing an incentive for those who can mechanise their processes to do so.

 

 

 

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