Investing in employees is one of the best ways for companies to be successful. An article in Time Business recently reported on this phenomenon. In “The Future of Retail,” MIT Professor Zeynep Ton argues that companies that invest in their workforce do better than those that view “retail labor as an expense to be cut.” “Highly successful retail chains” wrote Ton earlier this year “…not only invest heavily in store employees, but also have the lowest prices in their industries, solid financial performance, and better customer service than their competitors.” Ton studies the “efficiencies that become unlocked once you have a highly trained, highly motivated workforce” and warns against “retailing’s vicious cycle” where employers cut labor costs, thinking it will help their profits. These retailers end up doing worse in the long run, according to Ton’s research. “Recessions are famously great opportunities for businesses to invest and reinvent themselves” writes reporter Christopher Matthews, who tells retailers “now is a great time to invest in the long-term health of your labor force.”

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