As one of the fastest-growing industries in the country, food service — along with other low-paying sectors like retail and hospitality — is becoming the new normal of employment.
1. Fast-food workers are mostly teenagers working for pocket money.
Fast food was indeed an adolescent gig in the 1950s and 1960s, when the paper hat symbolized the classic short-term, entry-level job. But today, despite arguments that these low-wage jobs are largely filled by “suburban teenagers,” as the Heritage Foundation put it, labor data show that about 70 percent of the fast-food workforce is at least 20 years old. The typical burger-flipper is an independent adult of about 29, with a high school diploma. Nearly a third have some college experience, and many are single parents raising families on $9 an hour. In contrast to McDonald’s rather optimistic model budget — which assumes that an employee lives in a two-income household and doesn’t need child care or gas or groceries — a large portion of fast-food workers are forced to borrow from friends to cover basic household expenses, or sometimes fall into homelessness.
According to researchers at the University of California at Berkeley, about half of the families of front-line fast-food workers depend on public programs, compared with 25 percent of the American workforce. About 87 percent of fast-food workers lack employer health benefits, compared with 40 percent of the general workforce. And roughly one-fifth of workers’ families are below the poverty line. That adds up to some $7 billion in welfare payouts each year — essentially enabling fast-food mega-chains to subsidize ultra-low wages with public benefits.
2. Employees can work their way up and eventually even own a franchise.
Burger King’s career Web site proclaims: “You’ll never be short of opportunities to show what you’ve got. And if we like what we see, there’s no limit to how far you could go here.” The New York Restaurant Association boasts that restaurant work “creates an opportunity for people to live the American dream.” Under its franchise “success stories,” McDonald’s features a man who advanced from being a crew member to owning a franchise in just a few years.
The dream of upward mobility, however, eludes most workers. The National Employment Law Project (NELP) points out that about 90 percent of the fast-food workforce is made up of “front-line workers” such as line cooks and cashiers. About 9 percent are lower-level supervisors, who earn about $13 an hour. And just 2.2 percent of fast-food jobs are “managerial, professional, and technical occupations,” compared with 31 percent of jobs in the U.S. economy.
As for the notion of working your way up to ownership, NELP reports that 1 percent of the fast-food workforce owns a franchise — a purchase that could require $750,000 to several million dollars in financial assets. And there’s no indication that many of these franchisees actually did “rise through the ranks” to become owners, which requires an amount of capital that might top the lifetime salary of an average kitchen worker.
3. Fast-food companies can’t control franchise wages or working conditions.
McDonald’s plan to raise wages at least $1 over the local minimum wagewas announced this month to much fanfare. But the raise applies only to employees of the 1,500 stores McDonald’s owns directly. The company contends that as a chain franchisor, it merely licenses its brand to individual franchise operators; is not legally liable as an employer; and thus “does not direct or co-determine the hiring, termination, wages, hours” and other working conditions for all who toil under the golden arches.
But critics say these fast-food chains actually exert powerful oversight over their franchisees by closely tracking their spending and operations. Domino’s, one franchisee claims, critiqued how his employees answered the phone; Burger King franchisees sued the chain in 2009, claiming that it was forcing them to sell menu items for a loss at $1. Companies often pressure owner-operators to squeeze down labor costs: According to one employee quoted in the Guardian, “McDonald’s corporate representatives turn up at the restaurant where he works five or six times a year, counting the number of cars using the drive-through service, timing sales, making sure staff are preparing food according to McDonald’s specifications.” More so than most fast-food chains, McDonald’s wields financial control over its franchisees and owns the rental real estate of the restaurants.
Former McDonald’s executive Richard Adams has said
: “McDonald’s franchisees are pretty compliant. They don’t really organize, they don’t really protest. And if you do, they tell you you’re not a good member of the McFamily. I don’t want to make this seem too Orwellian, but the average franchisee has about six restaurants, and the franchise agreement is for 20 years. You’re probably going to have a renewal coming up. If you’re not a compliant member of the team, you’re probably not going to get that renewal.”
The issue of whether McDonald’s can be labeled a “joint employer” is being litigated in numerous claims of unfair labor practices that workers have filed with the National Labor Relations Board. The NLRB’s general counsel recently deemed McDonald’s a joint employer, and if it is ultimately penalized as such, workers could see a dramatic expansion in the company’s legal and regulatory obligations.
4. Flipping burgers is an easy job.
Some people chafe at the idea of “unskilled” fast-food workers meriting a wage more suited to a “high-skilled” job. Not only does this ignore the fact that this work requires skills — from managing inventory to training and supervising other employees — it also disregards the day-to-day challenges workers navigate on the job. According to a slew of complaints filed with the Occupational Safety and Health Administration, workers often suffer injuries such as hot-oil burns and are sometimes denied proper medical care. (Some are told to dress wounds with condiments.) Violence is also common at fast-food restaurants; according to a recent survey, roughly one in eight workers reported being assaulted at work in the past year.
Workers have also complained of racial discrimination, sexual harassment and retaliatory punishment by management. More than 40 of the NLRB claims filed against McDonald’s in the past few years alleged illegal firings or penalties because of workers’ engagement in labor activism. Add to all of this the challenge of just getting paid: Subway was found guilty of 17,000separate wage and hour violations since 2000, and in 2013, Taco Bell was hit with a $2.5 million settlement in a class-action lawsuit over unpaid overtime.
5. Paying workers $15 an hour would make burgers prohibitively costly and hurt the industry.
Some analysts, particularly on the right, have laid out doomsday scenarios of massive economic disruption caused by a sudden doubling of wages in the fast-food industry. The Heritage Foundation argues that raising wages to $15 an hour could lead to a price spike, shrinking job opportunities, and huge drops in sales and profits . In reality, any such wage increase would probably be incremental and could be absorbed in large part by lowering the fees collected by parent companies from franchisees. Fast-food workers already enjoy such higher pay in other countries with strong labor regulation and union representation. A Big Mac in New Zealand costs less than one in the United States — $4.49 vs. $4.79, according to the Economist’s Big Mac index — and it’ll likely be served by a full-time union worker earning about $12 per hour.
Higher wages might also bring business benefits, in the form of lower turnover and good press. The Michigan-based fast-casual restaurant Moo Cluck Moo offers a $15 wage alongside premium grass-fed burgers, turning its reputation as a socially responsible employer into a selling point. The market for super-cheap fast food is apparently declining. Consumers just might be hungry for a more conscientious business model.