Cost of living is very regional also. I'm from Alaska. My cost of living there is signifigantly more than my cost of living here in northern MN. It was in Alaska where the wash kid, lowest guy on the totem pole was making $20+ per hour. Starting pay for that position was $17 per hour. At the same time, there was other companies paying experienced operators $17 per hour. You can always find cheap employees. I just choose not to want cheap employees. I have two part time employees. Very part time the way this winter is going. They both have other jobs. One is my daughter that lives here, and the other is her college boyfriend that lives with his parents. They shovel walks if we get much snow. I wouldn't even consider paying them less than $15 per hour. My labor rate on my jobs is figured at $40 per hour. After taxes and workmans comp and all else, my cost for them is around $22.50 per hour. Figure in the fuel in my pickup they drive to the jobs, and everything else, I'm still making a little on their labor. If things work out, they will be full time employees during the summer. They will still get at least $15 an hour. I could find some kid for $8 an hour easy enough. I have standards with all employees. You could be the best person for the job and have your face all pierced up and tattoos scattered all over yourself and you won't have a job for me. I want professionals. I want employees that give a professional image. I want those employees for years to come. I don't want to have to teach people the work every year. Lawn maintenance is seasonal here. I'll try to keep my employees busy in winter with snow plowing, but years like this, that doesn't even work. Being seasonal employees, in order to retain them, I have to pay them well. By doing this, I reduce the hours I spend next year teaching a new crew. Those hours can be better spent finding revenue for my company. I don't have to babysit my employees. They learn their job and when they say it's complete, it is. That's time I can spend working on my company and growing my company. My employees don't resent me because they work with me. I have never asked any employee to do anything I'm not willing to do myself.
Everyone needs to run their company as they see fit. This is just my opinion. I've worked for two bit companies that payed as little as they could get away with, and I've worked for companies that payed well because employees were important to them. When I left my last job, the owner gave me a $10k bonus as I was leaving. While I have family issues keeping me away from that job, they are still a couple of my best friends. If they call and need me I'll be on the next plane north to help them out. My loyalty will always be with them. As I run my business, it's one of the business practices that will go with me because I've seen how well it works.