Do you find your employee an efficient worker? Is he performing well in your business? What could be the lost in your business if he leaves? You mention that you are barely keeping up with the demands, so is it possible to hire more employees, if he leaves? These are some of the things you can think about to trigger your decision. It is important to keep the employee happy if they are giving you great performances, but it is also important to measure the benefits you can offer to the benefits of your business.

I can understand your feelings when your employee address the early salary raise issue to you. If this employee is doing a great job, I believe you know that he deserves to get a raise, and it could also be a motivation for the other employees to work harder. On the other hand, if an employee is not performing efficiently, you should consider putting your focus on another that do.

If you need more support regarding the issue, I will be happy to help you sort things out. Best of luck!