Coalition of Franchisee Associations

December 27, 2022

Then Why Won't People Take the Jobs?

Social media worried McDonald's automation will cut millions of jobs


Anonymous said...

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.

A recent article 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...

If people were simply willing to come to work, Automation would not be necessary.

Anonymous said...

Millennials and Gen Zs struggle to make it past the crucial 90-day mark when starting a new job largely due to “own goals” such as lateness and absenteeism, a HR expert says.

Greg Weiss, who specializes in developing “onboarding” programs to help improve retention rates, says businesses face a growing challenge with the new generation.

According to Deloitte, millennials will make up 75 percent of the global workforce by 2025, but data shows this cohort have a much higher churn rate — and it’s costing money.

The Australian arm of global consulting firm PwC estimated staff turnover in the first 12 months was costing Australian businesses $4.8 billion in lost productivity and $685 million in avoidable recruitment costs.

“Typically one in four people will turn over in the first three months, either voluntarily or involuntarily,” said Weiss, founder of HR firm CareerSupport365 and author of “So You Got the Job, WTF is Next?”

“One in three millennials will turn over in the first 90 days. The reasons for failing, 62 percent is poor performance, 50 percent is absence, 25 percent is lateness and 30 percent is gross misconduct.”

Weiss said absence, lateness and misconduct were “clearly an own goal,” while poor performance could be a result of the employee not knowing what was expected of them or overstating their abilities.

Younger people are also more likely to quit voluntarily.

“Younger people will typically say, it’s not as great as I want, not as exciting, you’re underpaying, or frankly at the millennial end they’re just lazy, and I mean that genuinely,” he said.

While he didn’t want to generalize and say “every millennial is like this,” Weiss said “broadly it’s an entitled generation” and “probably also over-informed as well.”

“People are constantly on their phones, constantly wired to hear where the grass is greener,” he said.

“Every[body] is looking at everybody else’s highlight reel. People are not posting about how crap their current role is and what they’re really going through, they’re just living the high life. It gives an over-informed skew of the grass is always greener somewhere else.”

Weiss said that was compounded by a lack of “resilience” as a result of being brought up “cotton-balled and molly-coddled.”

“At the first sign of difficulty, it’s a choice of fight or flight, they typically choose flight,” he said.

Anonymous said...

We can only hope that automation is the answer. I am so sick and tired of no call-no shows who do as they please without fear of termination because they know we are very shorthanded and cant afford to fire them. And yet, corp has instituted the draconian PACE inspections in the midst of the worst hiring crisis in history! Good Grief, WHERE IS THE NFLA???????? (crickets)

Anonymous said...

How can you inspect automation? Can you send a 800-number complaint on the automation?

What use is all these new inspection programs, when its all automated?

Oh, reduce operators under the belief corporate can raise revenues by cutting out the middle man?!