Nope, it’s a terrible one. Everyone will be constantly looking for new jobs. And would do the bate minimum to not get fired, that’s the contract you’re signing, bare minimum pay for bare minimum work.

Regardless of what you do, it’s likely that you’ll need multiple times the amount of employees to get shit done, because one dedicated employee is worth several doing bare minimum, depending on the job some works simply won’t happen because no one gets paid enough to do them.

Besides that you’ll suffer brain drain, i.e. anyone good enough will leave you, and they won’t accept a raise to stay because if someone offered them double their salary and you tried to match it they would immediately see the bullshit you’d put them through and know that the only way to get a better pay again would be to get a new offer from someplace else.

Anyone bad enough that other companies don’t want would be stuck with you, but there’s a reason other companies don’t want them.

You wouldn’t be able to pull any new talent, you’d get stuck just getting people no one else wants because they’re the only ones willing to work for that low.

Is it good employer strategy to pay my employees just enough so that they can’t save money, so that they can never walk away from the job?

Yes! That’s how an average slave labour company works, you hire someone, you make them work long hours so they couldn’t have 2nd job or hobby, you pay them at the minimum wage, you lower their self worth and self esteem, and you put up all the barrier of quitting that’s actually illegal but they don’t dare to even test it. It’s the best strategy to keep yourself afloat and them underwater.

Like, there is a threshold where if they are able to save X per month, they will eventually use that against you and quit at an inopportune time?

Yep, there’s two way of employee retention, one is pay them good and treat them good they can’t even go through the bothersome process of searching job, another one is pay them just barely enough and trap them physically and mentally, drilling the learned helplessness into their mind so it’s impossible for them to even take the first step. Of course you’ll want to take the latter option because it’s the best slave labour strategy and maximise your own return!

And if that threshold falls below state mandated minimum wage, what steps can be taken to mitigate this?

You move to another state with lax law and force your employees to move, of course! And if that’s not an option, there’s always gonna be a pizza party on friday night.

Remember, the less money you pay for your employees, the more money you pocket yourself. Get yourself a Titanic tour ticket, you earn it!