Why? Why not?
In the era where economy mainly driven by consumerism like today, financial crisis will definitely slow things down. People will do less buying, not because they can save more, but because the money they earn are not enough to buy as much as usual. Moreover, more and more people laid off by their employers and this will reduce the rate of consumption significantly. To keep the economy going, companies should raise their employees’ salary and not laying off their staff. More money for the people so they can spend as much as they can, more spending, means more goods traded, more goods traded means more manufacturing, developments and in the end, keeps the money flowing in the market. This will keep the real business sectors alive, which in the end other sectors will benefited from the cash flowing on the market. More manufacturing will leads to absorbing more workforce and less unemployment.
Consumerism also leads to people with debt as a habit. Loans, mortgage and other funds from third parties to fulfill their needs, which sometimes go beyond their basic needs. How do you expect these people will be able to pay off their debt, if it’s hard to make ends meet with their current income? For people to be able to pay off their loans and mortgage, they should earn more. How? Either with side jobs, additional income or increase their income by increasing their salaries. Healthy debts will leads to healthy banks, and in the end, more money absorbed by the banks for investing in new ventures. Banks then saved from collapsing.
But how? Our company almost sinking down to the bottom, closing down, let alone increase the company spending by increase the employees’ salary. Ask your government for support, ask them for soft loans or subsidy to increase company’s capital so you can keep on producing and hence retain the current employees with increased salary. They can give huge bail out for those who literally the cause of this financial crisis, yes those greedy banker and CEO in greedy financial firms, why can’t they assist you which in turn would save the economy?