Forcing businesses to pay a mandated high wage for a low-value job creates a powerful incentive to automate that role, especially with the rise of AI. A better approach is bottom-up regulation that fosters a competitive labor market, forcing companies to increase wages naturally to attract talent.

Counterintuitively, paying employees significantly more than the market rate can be more profitable. It attracts A-players and changes the dynamic from a zero-sum negotiation to a collaborative effort to grow the entire business. This fosters better relationships and disproportionately larger outcomes where everyone wins.

Mandating wages be tied strictly to initial productivity discourages firms from hiring promising but untrained individuals. This is because the model of 'overpaying' someone during a mentorship period, hoping for a long-term return on that investment, becomes economically unviable.

Raising the minimum wage is a superficial fix for stagnant wages. True wage growth comes from two systemic factors: an education system that prioritizes valuable skill acquisition, and deglobalization, which prevents skilled domestic workers from being easily replaced by cheaper foreign labor.

Gusto's economist reports that small businesses added 120,000 jobs in March 2026, the highest since 2022. He argues that agile small businesses have already pivoted past recent economic shocks, leading a recovery while large companies are still slowly adapting.

Contrary to strong headline job numbers, Gusto's platform data shows that hiring among existing small businesses remains depressed. However, this weakness is offset by a significant increase in the formation of new businesses and new employers, painting a more nuanced picture of the American economy's health.

In a true market economy, labor shortages are impossible; wages would simply rise to attract workers. The argument that a country needs low-skilled immigrants to fill jobs is often a way to artificially suppress wages for the domestic working class, preventing market forces from correcting the balance.

Mid-sized companies struggling to compete with industry giants on salary can gain a significant recruiting advantage by offering a four-day workweek. This unique perk allows them to attract "A players" who value time and well-being, changing the terms of the talent competition.

Helping the middle class is a matter of economic physics, not emotional appeals. The most effective strategy is to create a labor market where there are more jobs than workers. This is achieved by re-shoring manufacturing and controlling the influx of cheap labor, which gives domestic workers the leverage to command higher wages.