Low fast-food wages come at high public cost

[Myles]

I literally just turned in a term paper about this very subject.

These strikers don't even understand the industry that they work in. $15 an hour is too high of a wage for such a low skill job. Typically, the more skilled someone is at a job, the higher they are paid to do said job. Most prep-cooks in fine dining restaurants start with a pay of $10 an hour, and line cooks start with a pay of $15 an hour. Working as a line cook takes more skill then working as a prep cook and prep work takes considerable more skill then working at a fast food restaurant. Why should fast food workers be paid the same for just heating up pre-made products as opposed to line cooks that make everything from scratch?

While fast food restaurant corporations make millions in profits, local owners make remarkably less in profits. The average profit margin for restaurants in Michigan is about 2% - 4%. That means that the profit for every dollar a restaurant receives is only $0.02 - $0.04; therefore, 1 million dollars in sales is only $20,000 - $40,000 in profit. The average annual sales for fast food restaurants is around 2 million so $40,000 to $80,000 in profit. Fast food restaurants simply can’t afford to pay their workers $15 an hour.

The people demanding $15 an hour don’t seem to realize that if they get their way there would be mass layoffs. Fast food restaurants would want to keep their prices the same so they can compete with their competitors. And the way they would do that is by firing over 75% of their workers and replacing them with automation.

Well said. I feel the same. Local fast food does not rake in the cash. However, if you are hard working and have initiative, you can easily move into assistant manager positions. So you have to work hard to get more money.

[questionmark]

How would you of done it?

And I did Obama first cause his bailout was bigger.

The Chrysler way: The government bails you out but gets the ownership of the company in return. Once the shares can be floated again the government tries to get its money back. There where that has been done it cost the taxpayer nothing, in fact the government earned some money.

[dmurdock36]

these are supposed to be entry level jobs not supposed to make a living working at burger king unless you own or manage one, if you dont like the wages at fast food places get a real job, leave those jobs for high school kids like it was intended.

[+OverSword]

I literally just turned in a term paper about this very subject.

These strikers don't even understand the industry that they work in. $15 an hour is too high of a wage for such a low skill job. Typically, the more skilled someone is at a job, the higher they are paid to do said job. Most prep-cooks in fine dining restaurants start with a pay of $10 an hour, and line cooks start with a pay of $15 an hour. Working as a line cook takes more skill then working as a prep cook and prep work takes considerable more skill then working at a fast food restaurant. Why should fast food workers be paid the same for just heating up pre-made products as opposed to line cooks that make everything from scratch?

While fast food restaurant corporations make millions in profits, local owners make remarkably less in profits. The average profit margin for restaurants in Michigan is about 2% - 4%. That means that the profit for every dollar a restaurant receives is only $0.02 - $0.04; therefore, 1 million dollars in sales is only $20,000 - $40,000 in profit. The average annual sales for fast food restaurants is around 2 million so $40,000 to $80,000 in profit. Fast food restaurants simply can’t afford to pay their workers $15 an hour.

The people demanding $15 an hour don’t seem to realize that if they get their way there would be mass layoffs. Fast food restaurants would want to keep their prices the same so they can compete with their competitors. And the way they would do that is by firing over 75% of their workers and replacing them with automation.

Although your paper would seem to make logical sense, perhaps you should study history and in particular the early years of the Form Motor Company. Fords model of paying his socalled unskilled labor up to 5 times the going wage worked out well not only for his company but for the nation. The luxury that you and I have grown up in is atributable to his model.

Some one from Michigan should be more aware of this than most.

Edited October 15, 2013 by OverSword

[+OverSword]

So im confused about how regulations would protect peoples jobs?

Because the way I see it is that over regulation and taxes is what makes companies more likely to go overseas or sell somewhere else. And kill small business.

I guess that would depend on how the regulations are written. If they are written in a way as to make it more expensive to imort manufactured goods than to manufacture them then the jobs don't go to China.

[+OverSword]

Sorry to have sidetracked the forum.

Do people really think it's ok that these multi-billion dollar companies employee benefits, including food stamps, rent supplements, coming soon health insurance is supplemented by you and I? Shouldn't such profitable companies be penalized if they pay less than a living wage to full time employees?

I When the employees of these companies sponge off of you its the same as the corporation sponging off of you.

[dmurdock36]

do you people really think if we force these fast food chains to raise there wages they are just going to do that and reduce there profit, if you do you are living in a fantasy land, we will pay the price in higher prices on our burgers, buisness is supposed to make money.

[dmurdock36]

oh and one other thing it is nobodys damn buisness how much they make either

[+OverSword]

oh and one other thing it is nobodys damn buisness how much they make either

But it is our damn business if a person woking 35 hours a week for a multi biullion dollar company needs his rent and food subsidised by our taxes.

And soon your insurance rates will increase to help pay for thier healthcare. Still none of our damn business? All in the name cheap burgers

Don't be a dumb-ass arguing on the side of big business against your own best interest is foolish to put it nicely.

Edited October 15, 2013 by OverSword

[dmurdock36]

its a fast food joint if that is the best job you can get you got more problems than just not being able to pay your bills, get a real job

[supervike]

oh and one other thing it is nobodys damn buisness how much they make either

Is too.

[dmurdock36]

the problem is not with the buisness it is with the lazy people that dont want to work want everything handed to them that is killing this country, its the whole gimme mentality that is killing us.

[dmurdock36]

I remember as a young man my mother worked 3 jobs as she was raising 3 kids by herself and was too proud to take a handout, we could have gotten free lunchs food stamps but that is not how she was raised and not how I was raised we took care of ourselves to the best of our ability, if I want to join a bowling league I had to work and pay for it.

[Gunn]

its a fast food joint if that is the best job you can get you got more problems than just not being able to pay your bills, get a real job

What real job?! Where the hell are they?! And how many of them are even left?! China! That's where!

You act like there are enough other jobs for everybody, besides the fast food industry. Wrong!

[+OverSword]

the problem is not with the buisness it is with the lazy people that dont want to work want everything handed to them that is killing this country, its the whole gimme mentality that is killing us.

Do you really believe that fast food is a cushy job where they take 1 hour lunches, smoke breaks, surf the web and basically don't work hard?

[+OverSword]

I remember as a young man my mother worked 3 jobs as she was raising 3 kids by herself and was too proud to take a handout, we could have gotten free lunchs food stamps but that is not how she was raised and not how I was raised we took care of ourselves to the best of our ability, if I want to join a bowling league I had to work and pay for it.

That was then. Now you will be required by law to have health insurance. if you can't afford it yours will be sup[plemented. Where do you think that supplement is going to come from? It will be reflected in the increased insurance premiums those of us who are well paid will see. so have fun subsidising McDonalds employees, and not by purchasing BigMacs either. Edited October 15, 2013 by OverSword

[Yamato]

Shouldn't such profitable companies be penalized if they pay less than a living wage to full time employees?

Penalized by who? The ones causing all the inflation?

[dmurdock36]

When I moved to san angelo the first job I got was roofing for 7.50 an hour I didnt get mad because the low wage I worked there and looked for something better when I found it I moved on, if you are willing to work there are jobs out there its just most people arent willing to do the low wage job i guess they feel it is beneath them I know I would be embarrased to have to take a handout from the government and it if there was no other way I would take it but with the intention of getting off of it as quickly as possible.

[+OverSword]

Penalized by who? The ones causing all the inflation?

LOL! Good point. But yes, by the ones causing the inflation.

[+OverSword]

When I moved to san angelo the first job I got was roofing for 7.50 an hour I didnt get mad because the low wage I worked there and looked for something better when I found it I moved on, if you are willing to work there are jobs out there its just most people arent willing to do the low wage job i guess they feel it is beneath them I know I would be embarrased to have to take a handout from the government and it if there was no other way I would take it but with the intention of getting off of it as quickly as possible.

I'm totaly with you there Murdock, and believe me I worked minimum wage when it was $3.15 an hour. But you know what, it was a lot different world back then. Back then if you came out of college 20 grand in debt you were pretty likely to get a good enough job to pay that off a few years. Now you get out of college 80k in debt and have to move in with your parents.

When I was born my 19 year old father had a wife, a house, two cars one station wagon and one corvette and a job at boeing.

When I was in high school 16year olds in my class had a muscle car that was less than 8 years old paid for with thier own part time job. It was just a different world then. And it's going to be alot different pretty soon, so you'd better stop arguing for the very people who are doing thier damndest to to live in mansions while the people that put them there are living on government subsidies.

[dmurdock36]

I moved to san angelo 8 years ago so it wasnt that long ago, I dint go to college because we couldnt afford it, I have been homeless I have lived in my car I have gone without eating for as long as 3 days, wasnt easy but life isnt supposed to be easy, everything I went through was all my fault nobody put me in that position therefore I would never ask anyone elst to pay for my mistakes, I took responsibility for myself and I got by the best I could. nobody owes me anything and I dont feel I owe anybody anything. people just dont care anymore if they can make someone else pay for there mistakes they do it. no consequences I think we should start a welfare payback system where if you take a handout from the government the totals are kept as to how much you have taken and then when you do get on your feet you are required to pay it back. I bet the welfare rolls would get a lot smaller.

[Ugly1]

Don't be stupid. You live in the past. The people that work fast food now used to work in manufacturing. Should they have followed thier jobs to asia? Is it thier fault that instead of being able to manufacture cars, computers, heavy equipment etc... they're now forced to take whatever job there is enough of? It is the failure of our government to protect good middle class manufacturing jobs and the greed of corporations and indeed our own fault for continuing to buy products from companies who have gutted our jobs.

What is considered the past? I'm 31 years old and that's how it was when I was 18. I know a lot has changed with our economy in the past 13 years but give me a break. Did people in manufacturing require college degrees for those jobs? I can see that some of the people from manufacturing and other sectors were forced to take the fast food jobs but you make it sound as if we have no construction jobs left and everyone is working at Burger King or something. In America we have this thing called the American Dream where you can go to school and become WHATEVER THE HELL you want. If you say that is nonsense then we will just say that foreigners are able to come to America, go to school and get awesome jobs. You aren't seeing many Indian Doctors with a p.h.d. applying for fast food jobs in my neck of the woods. If you have a degree and are not working at the desired field, then keep at it and you will be. That is America. I don't count a film major or someone similar to have much luck in the job field. Is it the governments fault that people got crap degree's and are working these fast food jobs as well?

I understand that circumstance can have people working in fields that may not be the best paying but those people are still free to make other choices. People act like they are glued to their Burger King job. How about people start making better choices and stop blaming the government for every freaking thing that the person doing the blaming has control over. The problem is that people don't want to sacrifice to make their situation better. Instead of b****ing on blogs about how Burger King isn't supporting their family, maybe they should get off their butts and do something to actually improve their situation. I doubt many foreign doctors living the American dream hit a snag, then went home b****ing online about how the government needs to help more. They did something about the snag to improve their situation.

Edited October 15, 2013 by Ugly1

[Odin11]

I don't disagree with any particular of what you wrote, but perhaps there is an alternative in that the fast-food model is inherently unsustainable?

Fast food restaurants run on a high food cost to low labor cost, low profit to high sales model. It works well, but is not meant to support people with families.

Although your paper would seem to make logical sense, perhaps you should study history and in particular the early years of the Form Motor Company. Fords model of paying his socalled unskilled labor up to 5 times the going wage worked out well not only for his company but for the nation. The luxury that you and I have grown up in is atributable to his model.

Some one from Michigan should be more aware of this than most.

Henry Ford was a personal hero of mine when I was growing up. I’ve been to Henry Ford’s home, I’ve been to The Rouge, I’ve even stood in the very place he built his first automobile.

I’m quite aware of how Ford treated his workers. He did not pay them 5 times the going wage; he doubled it by paying 5 dollars a day and made the workday shorter to 8 hours a day. He did not do this for charity but to lower employee turnover and so he could run three shifts instead of two. This greatly increased productivity, making Ford a lot of money. The history of the Ford Motor Company is almost mandatory for Detroit area students.

The Ford Motor Company had a high profit margin and could easily afford to pay its workers more. Fast food restaurants on the other hand have very low profit margins, around 2% - 4%, and can not afford to pay their workers more.

Sorry to have sidetracked the forum.

Do people really think it's ok that these multi-billion dollar companies employee benefits, including food stamps, rent supplements, coming soon health insurance is supplemented by you and I? Shouldn't such profitable companies be penalized if they pay less than a living wage to full time employees?

I When the employees of these companies sponge off of you its the same as the corporation sponging off of you.

Again, while fast food corporations make millions in profits the individual franchises do not. The average profit margin for fast food restaurants is about 2% - 4%, with annual sales at around 2 million dollars meaning profits of only $40,000 to $80,000, not a lot of money. Like I’ve said above paying them $15 an hour would just mean mass layoffs.

Now all of this does not mean I don't think they should get anything. A small raise is needed, but not doubling their wage.

[+OverSword]

• McDonald's' $24 billion in revenue makes it the 90th-largest economy in the world
  
• Counting $32 billion in revenue from franchise stores, McDonald's claims the 68th biggest economy, bigger than Ecuador
  
• McDonald's hires around 1 million workers in the US every year
  
• McDonald's is the world's largest distributor of toys, with one included in 20% of all sales
  
• The Queen of England owns a McDonald's near Buckingham Palace as part of her vast real estate portfolio
  
• For the next three years, McDonald's is going to open one restaurant every day in China
  

Do you still want to subsidize Mcd's employees? Because that's what this thread is really about.

Edited October 15, 2013 by OverSword

[+OverSword]

What is considered the past? I'm 31 years old and that's how it was when I was 18. I know a lot has changed with our economy in the past 13 years but give me a break. Did people in manufacturing require college degrees for those jobs? I can see that some of the people from manufacturing and other sectors were forced to take the fast food jobs but you make it sound as if we have no construction jobs left and everyone is working at Burger King or something. In America we have this thing called the American Dream where you can go to school and become WHATEVER THE HELL you want. If you say that is nonsense then we will just say that foreigners are able to come to America, go to school and get awesome jobs. You aren't seeing many Indian Doctors with a p.h.d. applying for fast food jobs in my neck of the woods. If you have a degree and are not working at the desired field, then keep at it and you will be. That is America. I don't count a film major or someone similar to have much luck in the job field. Is it the governments fault that people got crap degree's and are working these fast food jobs as well?

I understand that circumstance can have people working in fields that may not be the best paying but those people are still free to make other choices. People act like they are glued to their Burger King job. How about people start making better choices and stop blaming the government for every freaking thing that the person doing the blaming has control over. The problem is that people don't want to sacrifice to make their situation better. Instead of b****ing on blogs about how Burger King isn't supporting their family, maybe they should get off their butts and do something to actually improve their situation. I doubt many foreign doctors living the American dream hit a snag, then went home b****ing online about how the government needs to help more. They did something about the snag to improve their situation.

Dude. You are 31 and that is how it was when you were 18? BS. It was bad even then you just didn't have a frame of reference. I've been around a lot longer than you. I'm not trying to belittle you, you just think you know what the show was about but you missed the begin Wait till you retire and your home isn't worth what you invested and you are likely to just have to work until you drop, then talk to me.