Why are higher salaries not the best incentives for workers?
The main aim of an employer or an organization is to maintain and attract skilled workers or employees. Having skilled labor helps business continuity, efficient utilization of the resource, save on training new staffs, and maximizing profits. With taking these facrtors into consideration, firms increase the staff’s salary as an incentive to stick around and motivate them. Higher salaries are, however, not the best incentive but only an option. The best incentive is the right working conditions, job security, and performance-based rewards and bonuses. Hence higher salaries are not the best incentives.
Good Working Conditions
Good working conditions in an organization help retain and attract the best worker and employee to an organization. A conducive working environment entails putting in place measures to help employees grow socially, economically and gain new skills. Organizations should make policies and guidelines that aim at making them feel at home. The measures should include flexible working hours, provision for medical insurance, and pension. An organization should practice fair treatment of all employees, promoting development and career growth and proper communication of instruction. The measures are some of the incentives that an organization can put in place as better than higher salaries.
Employee job security serves as one of the workers’ incentives sticks to an employer, attracting new skilled ones. Most workers view job security as the main reason behind them not changing jobs. Hence most people prefer working in the public sector, where they associate it with job security. With job security, employees can easily plan their future with minimal uncertainty. The decisions may involve the advancement of one’s education and issues relating to raising a family. These are essential decisions regarding job security that employees make and as best incentives than higher salaries.
Performance-Based Rewards and Bonuses
Performance-based rewards and bonuses are the best incentives to motivate employees. The incentive will hence maintain skilled labor and also attract new employees from the industry. In most cases, the performance-based rewards and bonuses may end being higher than the basic salary depending on the effort each or collectively the employees put into the work. A higher salary for everyone may not be the best initiative since it rewards all employees despite putting different output levels. Hence performance-based rewards and bonuses are the best incentives in comparison to higher salaries for all employees.
In conclusion, higher salaries are not the best incentives for the workers but should just one of the incentives. All employees are subject to higher salaries, which may not be the best incentive since it would lead to inequality in rewarding extra performance. Higher salaries with a bad working environment, no job security, and no performance-based rewards and bonus will still lead to high employee turnover. It makes a conducive working environment and job security the best incentive to workers. Thus higher salaries are not the best incentives to motivate, maintain, or attract skilled labor.