MICHAEL WALSH FORMER GUILD OF MASTER CRAFTSMEN BUSINESS ADVISER

Henry Ford’s massive wage increase in 1914 wasn’t just a raise; it was a shockwave.

Yet, one-hundred years on, business owners are seemingly incapable of using their brains to keep staff, lower overheads, and increase profitability

At the time, the assembly line was brutal: the work was repetitive, dangerous, and mind‑numbing.

Ford’s factories were losing workers faster than they could hire them. Some departments saw employee turnover rates above 300% a year, meaning fed-up slave workers quit after days or even hours.

Training new employees was costing The Irish-American Henry Ford more than simply paying the existing ones better. The $5‑a‑day wage was a strategic move to stabilize his workforce, not an act of generosity.

The raise also had a second purpose: discipline and control. Ford tied the new wage to social behavioral standards. These were enforced by his Sociological Department. This department checked out workers’ homes, spending habits, and personal lives.

After all, what employer wants the self-indulgent or alcoholics? They would spend their high wages on a dissolute lifestyle. They would also choose when they wished to work.

To qualify for the full $5, employees had to meet Ford’s expectations of proper living. This included no drinking and no gambling. They were expected to maintain a stable family life and exhibit good moral conduct.

In other words, Ford wasn’t just paying workers more. He was shaping them into the kind of workforce he wanted. He was shaping them into the kind of man he was.

But the strategy worked beyond anything Ford expected. The wage increase made headlines worldwide and turned Ford into a magnet for skilled labor.

Thousands lined up outside his factories hoping for a job. Productivity soared, turnover collapsed, and Ford’s cars became cheaper to produce.

The $5‑a‑day wage didn’t just stabilize his factories, it helped create the American middle class.

Workers could suddenly afford the very cars they built. They became part of a new consumer economy. This proved that sometimes the smartest business move is simply paying people enough to stay.

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THE BUSINESS BOOSTER Michael Walsh: 1,000s of business and sales advice books, why is The Business Booster considered essential reading? For twenty years, Michael Walsh excelled as the leading business assessment executive. He was also the top recruitment executive for the United Kingdom’s Guild of Master Craftsmen. The Business Booster is a unique guide. It helps small traders and self-employed craftsmen significantly reduce costs. It also adds to business profits. https://www.lulu.com/shop/michael-walsh/the-business-booster/paperback/product-2m4wypv.html?page=1&pageSize=4