On Thursday, fast food workers in over 100 US cities will walk off the job to demand an increase in the minimum wage to $15. The current rate is $7.25 and President Obama has already committed to backing a Senate measure to raise it to $10.10. The walkout is supposed to create sympathy for minimum wage earners, but it’s time for some straight talk about the minimum wage and the fast food industry.
Fast food jobs are often referred to as “entry level” because they represent a starting point for those lacking skills, good work habits and experience. They only become long term for those who fail to develop the skills, job habits, or ambition necessary to move up or move on. The idea that unskilled workers should be able to raise a family on minimum wage is mere socialist rhetoric. In our economy, most fast food workers are not worth $15 an hour, which is they aren’t already paid that now.
Proponents of a higher minimum wage fail to understand that someone must pay for it, and that someone always ends up to be the customer. In fact, an increase in wages at fast food restaurants will have little if any impact on profits. When the mandated cost of labor rises, companies respond by using less of it whenever possible and raising prices to make up the difference. This means there would be fewer entry-level jobs available for unemployed Americans who desperately need work, quite possibly fewer hours–perhaps less than 30 per week–for those who are able to retain their jobs at the higher hourly rate, and higher prices for the food we purchase. As economists say, there’s no such thing as a free lunch, not even at a fast food restaurant.
There’s also a misconception about who earns minimum wage. According to the BLS, only 1.6 million of the 75.3 hourly workers in the US in 2012 were paid the minimum wage. But labor leaders know than an increase in the minimum wage would have a ripple effect to other workers as well. Some union contracts even mandate wage increases that are tied to changes in the minimum wage, so an increase in the bottom rate will push other rates up as well.
In the end, raising the minimum wage is bad economic policy and ultimately hurts those its proponents claim to be helping. It not only gives employers an incentive to hire fewer workers and cut hours, but also promotes an entitlement mentality among those entering or about to enter the work force. Our economy needs lots of burger-flipping jobs at market wages for those who need a place to start. Mandating that companies overpay these workers eliminates the opportunities these workers so desperately need.
why stop at $15? what about $25 an hour?
Why only $25? Let’s pass a law that triples everyone’s salary then everyone would be rich…
It took my young daughter about 15 seconds to figure out this is a bad idea. But, hey, it is easy to spend other people’s money!
This is where conservatives have it wrong. A modest increase in the minimum wage can remove millions of people from welfare, which means less dependence on government. Isn’t it better to pay people more for working than to pay them for not working?
According to today’s WSJ, the following states/cities have planned to increase minimum wage in 2014:
Washington – $9.32
SeaTac, Washington – $15
Washington D.C -$9.50
Connecticut – $8.70
California -$9.00
San Francisco – $10.74
New York – $8.75
Rhode Island – $8.00
New Jersey – $8.25
Just saying….
Former McDonald’s USA CEO Edward Rensi explains how fast food franchise owners deal with mandated wage increases:
http://video.foxbusiness.com/v/2921003323001/would-fast-food-franchisees-cut-jobs-if-minimum-wage-is-raised/?intcmp=obnetwork
Be careful what you demand, you might get it.
Aliza-What’s your point? It’s no surprise that the places you listed are run by liberals and have a higher cost of loving. The minimum wage is bad for the economy no matter where it occurs.
I’m not convinced that it is bad for the economy. If workers earn more money, they can spend more and that is good for the economy. McDonald’s makes billions of dollars in profits and it can increase the minimum wage .It will roll that on us, the customers, anyway and a McDonald’s combo will cost about $7.5 -8 instead of $6.5. That’s not what will kill us. Why people who work a full time and a very intensive job cannot survive?
hey aliza, people who earn the minimum wage don’t earn more because they’re not worth it. Don’t you get it, many of them will lose their jobs if companies have to pay more. How does this help the poor?
Jerry, what do you prefer, that people will live on welfare and then you pay their living (through your taxes) or that they will continue working for a decent pay, paid by McDonald’s, the Waltons and such. I prefer the second alternative.
that’s a false choice. welfare is supposed to be temporary, just like entry level jobs at mcdonalds. if someone wants to work for low pay their entire life, it’s their choice. we shouldn’t have to subsidize them through our taxes.
Liberals always assume that government has to take care of everyone and they argue for one way of doing it because it’s better than another way of doing it. The problem is with the assumption.