Coalition of Franchisee Associations

November 5, 2020

Unions Rejoicing Over $!5 Min. Wage Wins

Success of $15 Minimum Wage Measures 'Huge Win for the Working People' of Florida and Portland, Maine | Common Dreams News


Anonymous said...

McDonald’s employees who picketed for a better living wage (whatever that means) may come to regret that decision. According to a Redditor, a McDonald’s in Illinois replaced their cashiers with machines. The machines appear to be the cousins of the ones found in grocery stores, big box stores, and CVS that allow customers to complete transactions.
How cost effective is replacing an organic employee with a mechanized one? According to an economic blog, and unsurprisingly, the machines likely come out on top in terms of pricing:
• For a location open 24 hours: The cost of human cashiers, not counting benefits, $15/hour * 24 hours * 365 days/year = $131,400
• For a location open 6AM to Midnight: $15/hour * 18 hours * 365 = $98,550.
• For the machine to be cost effective, all it needs to do is cost less than $100,000 a year to buy and maintain.
Who could’ve possibly seen this coming? Forbes. They predicted this exact scenario
A recent article at the Huffington Post makes the claim that if McDonald’s doubled its employees salaries it would only cause the price of a Big Mac to go up by 68 cents. The implication here is that 68 cents isn’t much money, so they should do it. There’s a few things missing from this.
One is that the article itself alleges that doubling wages would lead to a 17% increase in costs. And I guess this is obviously supposed to seem like a small amount? It doesn’t look that way to me. What do people expect will happen when prices go up 17%? If McDonald’s could raise its prices by that much without lowering demand they would. No, what would happen is people would shop at those stores less, there would be less profit and less McDonald’s stores to hire workers.
Doubling of labor costs will simply increase a fast food restaurant’s incentives to adopt technology like this. And if fast food wages doubled everywhere it would spur the development of these technologies even faster.This is all basic economics, really. As costs of labor increase the added cost must be offset. In order to satisfy operating costs, produce a product consumers want to purchase, and still turn a profit, it’s perfectly reasonable for a company like McDonald’s to look for cost-cutting alternatives. As Forbes pointed out, the added pressure to increase wages only serves to expedite technological solutions.
But cooks are safe from the machination of American fast food, right?Not if companies like Momentum Machines has anything to do with it. “Our technology will democratize access to high quality food making it available to the masses,” their site claims. They also claim their burger making machines can, “do everything employees do except better” and that the machines reap such large labor savings, restaurants will be able to afford twice as fancy ingredients. Tempting little proposition they have there.
“Would you like fries with that?” may soon be a long forgotten relic of American pop culture. And all because it makes good economic sense.

Anonymous said...

I want to talk to those of you who actually consider yourselves entitled to close to a $29 thousand a year full time salary for doing a job that requires no skill, no expertise, and no education; those who think a fry cook ought to earn an entry level income similar to a dental assistant; those who insist the guy putting the lettuce on my Big Mac ought to make more than the Emergency Medical Technician who saves lives for a living; those who believe you should automatically be able to “live comfortably,” as if “comfort” is a human right.

First, let me start with a story. It’s anecdotal, obviously, but then this whole #FightFor15 “movement” is based entirely on anecdotes.
I submit mine: I’m 35 years old now. I started working when I was about 15. I did hourly, customer service-type stuff at grocery stores, snowball stands, and pizza places, never making much more than the bare minimum at any of them.
When I was 20 I moved out of the house and got my first job in radio. Starting out as a rock DJ in Delaware, I made $17,000 a year, or about $8 an hour. I lived off of that, earning a few small raises through the years — having to eat fewer meals, buy fewer things, and, God forbid, even forgo cable and internet access in my apartment — right up to when I got married at 25.
Around my 26th birthday, over 10 years after my first job, I landed a position in Kentucky that paid me around $40,000. It was the first time I’d ever made the equivalent of $15 an hour or more. Again, this was after 10 years of working. Of course, our new found wealth soon had to be split between four people, as my wife became pregnant with our twins within a few months of me starting the job.

It took me over a decade to get here.
You think the jobs I had when I was 16 should have provided me with the comfortable living I just established in my late 20′s? Frankly, I think you’re delusional.
To understand how delusional, consider that a $15 an hour full time salary would put you in the same ball park as biologists, auto mechanics, biochemists, teachers, geologists, roofers, and bank tellers.
You’d be making more than some police officers.
You’d easily out earn many firefighters.
Ironically, you’d be fast food workers with starting salaries higher than many professional chefs, which is a bit like paying a tattoo artist less than the person who paints cat whiskers on your face at the carnival.
You’d be halfway to the income of accountants, engineers, and physical therapists.
Does that sound fair? It might sound fun, but does it sound fair? These are highly skilled jobs which require years of training and education. These are jobs which, in some cases, our society profoundly relies upon. Jobs with enormous responsibilities. Jobs that are considerably more complex and complicated than refilling the soda fountain at Roy Rogers.
I’m not insulting you, but when you claim you ought to be able to stroll into Hardee’s and be immediately rewarded with a salary higher than crane operators and medical lab technicians, someone needs to talk some sense into you.
I wish I didn’t have to point out that you are doing something which is fundamentally worth very little, but when you stomp your feet and insist you should be handed what some of us worked decades to earn, that’s when it becomes time for, as the kids would say, real talk.
So, real talk: your job isn’t worth 15 bucks an hour. Sure, as a human being, you’re priceless. As a child of God, you’re precious, a work of art, a freaking miracle. But your job wrapping hamburgers in foil and putting them in paper bags — that has a price tag, and the price tag ain’t anywhere close to the one our economy and society puts on teachers and mechanics.

Anonymous said...

I understand the above thought process. And in general, agree. My only other point, would be to add that inflation is a real cost. I’ve always felt individual McDonald’s restaurants would grow at the pace of inflation. Everything is relative. We’ll see if the system breaks. buy bitcoin.