In the USA there is a general consensus that the government should be responsible for monitoring the wages of low income earners to make sure they are reasonably compensated. Mandatory minimum wages are set to force businesses to treat employees fairly. This article suggests another possible way to control wages; leave it to the market. Many big box stores have begun paying higher wages not because of government regulation, but because it is what customers want.
Customers have significant power when it comes to pushing companies to change. If a customer’s number one priority is to purchase a product at the lowest possible price, they will send that signal to companies who will cut their costs in whatever way they can to lower prices. This often means seeking out the lowest cost for labor. On the other hand, if consumers really desire higher wages for everyone, they must signal that to businesses through their willingness to spend an extra fifty cents on a burger to support a company that pays higher wages to its employees. Consumers have a real power to dictate a business's behavior by choosing to support companies that go along with a desired change.
It is assumed that businesses seek to optimize profits. Adhering to customer demands can result in increased sales, which can outweigh the cost of the increased labor. If the cost of increased labor is greater than the benefit of increased sales, it is probable that the majority of consumers do not feel strongly about the need to increase wages. It is interesting to consider consumers as voters who really have the power to impose their own regulations on businesses. Such consumer imposed regulation could even prove to be more efficient than government regulation.