The Burger-Flipping Robot vs $15 Min Wage Demand

[B767drvr]

Those fast-food workers striking for a $15 minimum wage might soon find themselves REPLACED altogether!

What's the nation going to do with all the unskilled labor out there? Is this society's problem, or an individual's problem?


>>
A company called Momentum Machines has built a robot that could radically change the fast-food industry and have some line cooks looking for new jobs.

The company's robot can "slice toppings like tomatoes and pickles immediately before it places the slice onto your burger, giving you the freshest burger possible." The robot is "more consistent, more sanitary, and can produce ~360 hamburgers per hour." That's one burger every 10 seconds.

The next generation of the device will offer "custom meat grinds for every single customer. Want a patty with 1/3 pork and 2/3 bison ground to order? No problem."

Momentum Machines cofounder Alexandros Vardakostas told Xconomy his "device isn’t meant to make employees more efficient. It’s meant to completely obviate them." Indeed, marketing copy on the company's site reads that their automaton "does everything employees can do, except better."



Read more: Momentum Machines Burger Robot - Business Insider (http://www.businessinsider.com/momentum-machines-burger-robot-2014-8#ixzz3CNJnKZLn)

<<

[dewilson58]

There are already automated order takers in use that are replacing the people at the front counter.

Be careful what you wish for.

[tippyclubb]

It's a society problem. People want something for nothing and think society owes them, without having to work hard for it. Either way these fast food workers will loose this battle. If they are not replaced with robots who's going to pay $12 for a mediocre burger? I know I won't. If the business cannot make a profit they will shut the doors.

[Medtrans]

No more dollar menu..

[Hankg42]

Times change. Technology drives a lot of change. I suppose they will still need minimum wage labor to clean the machines that flip the burgers. Machines can't do everything (I hope!). As job requirements change, the workforce will have to change as well.

[golf2140]

For those pushing the $15.00 per hour, try this. Go into your fast food joint. Place your order having a twenty dollar bill in hand. When they total you bill, give the person the twenty plus the exact change. Talk about a blank stare. Also $32,000.00 a year to work a french fry cooker !!!!!!

[MzDoMel]

keep replacing theses workers with robots and machines. Be proud that you stood up against giving some one a job and a pay check they can live on.Just do not complain to anyone that you are paying such high taxes to support all of the people out of work and on government hand outs. I rather pay a little more for what I want and see a worker work for the money, then have it given to them to stay home.

[Medtrans]

Granted $8.30 an hour is too little but $15.00 is nearly double. I know people who are admins, nurses aides, data entry clerks, etc. that don't make $15.00 an hour.

[Chi-Town]

For those pushing the $15.00 per hour, try this. Go into your fast food joint. Place your order having a twenty dollar bill in hand. When they total you bill, give the person the twenty plus the exact change. Talk about a blank stare. Also $32,000.00 a year to work a french fry cooker !!!!!!
Heck, I'm staring at this post.

[dbussone]

No more dollar menu..

Right. It will drop to $0.50 when the robots replace the current workforce.

[eweissenbach]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare. He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.

[xNYer]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare. He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.

I find it hard to read this thread. i certainly don't want to demean fast food workers when I know nothing about them as individuals. it is sad to see these things written here.

[sunnyatlast]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare. He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.

Well I know a local McDonalds franchisee who started working for them when burgers were probably 15 cents. Same situation with the local Wendy's and KFC franchisees, and in all three franchisee situations, their kids have started on the bottom, flipping burgers and cleaning the place, to move up the ladder to being store managers. Other dependable and ambitious workers can work their way up to management the same way.

If they want to make much more money than $15/hour, they can take their McD's experience and go to work for a more expensive, order-from-the-menu restaurant where they can earn tips of $20-$30 plus, per hour. If they WANT to.

A couple of years ago I met a Walmart store manager and thanked him for the efficient service I had that day at the cashier line (which was not the case at other area Walmarts). He told me "I love my job. I started out working for Walmart in high school, and here I am…store manager. They gave me a great opportunity to move up!"

[janmcn]

It's a society problem. People want something for nothing and think society owes them, without having to work hard for it. Either way these fast food workers will loose this battle. If they are not replaced with robots who's going to pay $12 for a mediocre burger? I know I won't. If the business cannot make a profit they will shut the doors.

If people are demanding higher wages, doesn't that mean they are working? If people are working, how does that mean they want something for nothing?

[rjm1cc]

For those pushing the $15.00 per hour, try this. Go into your fast food joint. Place your order having a twenty dollar bill in hand. When they total you bill, give the person the twenty plus the exact change. Talk about a blank stare. Also $32,000.00 a year to work a french fry cooker !!!!!!
Better add in payroll taxes and health insurance. Assuming vacation and sick pay add the cost of a replacement worker to the cost of the meal too.

[eweissenbach]

Well I know a local McDonalds franchisee who started working for them when burgers were probably 15 cents. Same situation with the local Wendy's and KFC franchisees, and in all three franchisee situations, their kids have started on the bottom, flipping burgers and cleaning the place, to move up the ladder to being store managers. Other dependable and ambitious workers can work their way up to management the same way.

If they want to make much more money than $15/hour, they can take their McD's experience and go to work for a more expensive, order-from-the-menu restaurant where they can earn tips of $20-$30 plus, per hour. If they WANT to.

A couple of years ago I met a Walmart store manager and thanked him for the efficient service I had that day at the cashier line (which was not the case at other area Walmarts). He told me "I love my job. I started out working for Walmart in high school, and here I am…store manager. They gave me a great opportunity to move up!"

So you are equating the opportunity available to the children of the franchisee to the typical employee?

[Indydealmaker]

If people are demanding higher wages, doesn't that mean they are working? If people are working, how does that mean they want something for nothing?

First, most of the people protesting do not work. That is why they have the time to sit outside the McDonald's.

Second, there is a value to be placed upon a given job. Higher pay in no way translates to higher performance.

It is incumbent upon the employee to seek higher wages through higher performance. This is EASY in the fast food business. Employees are so lax that anyone can stand out if they so choose. Fast food establishments universally schedule more employees per shift just so they can have enough help to actually show up. The only places that do not have this problem are the ones that employ primarily seniors.

[dbussone]

Well I know a local McDonalds franchisee who started working for them when burgers were probably 15 cents. Same situation with the local Wendy's and KFC franchisees, and in all three franchisee situations, their kids have started on the bottom, flipping burgers and cleaning the place, to move up the ladder to being store managers. Other dependable and ambitious workers can work their way up to management the same way.

If they want to make much more money than $15/hour, they can take their McD's experience and go to work for a more expensive, order-from-the-menu restaurant where they can earn tips of $20-$30 plus, per hour. If they WANT to.

A couple of years ago I met a Walmart store manager and thanked him for the efficient service I had that day at the cashier line (which was not the case at other area Walmarts). He told me "I love my job. I started out working for Walmart in high school, and here I am…store manager. They gave me a great opportunity to move up!"


Now THAT is the American way.

[Dr Winston O Boogie jr]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare. He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.

Did you ever ask him how much he had to risk in order to buy that franchise? His employees are being paid what they are worth. and in many cases, based on my experience, they are getting more then they are worth. What does his income have to do with anything? Why should he give people money for nothing?

And while your at it, ask him how much he gives to charitiy and how much he pays for taxes each year.

[BobnBev]

Those fast-food workers striking for a $15 minimum wage might soon find themselves REPLACED altogether!

What's the nation going to do with all the unskilled labor out there? Is this society's problem, or an individual's problem?


>>
A company called Momentum Machines has built a robot that could radically change the fast-food industry and have some line cooks looking for new jobs.

The company's robot can "slice toppings like tomatoes and pickles immediately before it places the slice onto your burger, giving you the freshest burger possible." The robot is "more consistent, more sanitary, and can produce ~360 hamburgers per hour." That's one burger every 10 seconds.

The next generation of the device will offer "custom meat grinds for every single customer. Want a patty with 1/3 pork and 2/3 bison ground to order? No problem."

Momentum Machines cofounder Alexandros Vardakostas told Xconomy his "device isn’t meant to make employees more efficient. It’s meant to completely obviate them." Indeed, marketing copy on the company's site reads that their automaton "does everything employees can do, except better."



Read more: Momentum Machines Burger Robot - Business Insider (http://www.businessinsider.com/momentum-machines-burger-robot-2014-8#ixzz3CNJnKZLn)

<<

WOW!!! No more bathroom breaks, smoke breaks, coffee breaks. The wonderful world of automation. I think I'll invent a robot to clean and oil the other robots. Maybe give him a key to the front door.:loco:

[CFrance]

Heck, I'm staring at this post.
Me too.:shrug:

[eweissenbach]

Did you ever ask him how much he had to risk in order to buy that franchise? His employees are being paid what they are worth. and in many cases, based on my experience, they are getting more then they are worth. What does his income have to do with anything? Why should he give people money for nothing?

And while your at it, ask him how much he gives to charitiy and how much he pays for taxes each year.

The risk in buying a MacDonalds franchise is very minimal. As I said, he deserves a nice return on his investment and considering the risk of his capital. The employees are being paid what they are worth, or by your impeccable standards, more than they're worth? By what standard? His income has everything to do with it, because one should calculate the value of the employees based on their contribution to generating that income. He should not give people money for nothing, if they generate no profit they should be fired, but if they generate profit they should share in the success of the operation. I don't know what he gives to charity nor what he pays in taxes, but he seems to have plenty left over to get by. My children own several businesses and are very successful, and to their credit they compensate their employees very well with incentive bonuses if the company thrives.

[Mikeod]

The risk in buying a MacDonalds franchise is very minimal. As I said, he deserves a nice return on his investment and considering the risk of his capital. The employees are being paid what they are worth, or by your impeccable standards, more than they're worth? By what standard? His income has everything to do with it, because one should calculate the value of the employees based on their contribution to generating that income. He should not give people money for nothing, if they generate no profit they should be fired, but if they generate profit they should share in the success of the operation. I don't know what he gives to charity nor what he pays in taxes, but he seems to have plenty left over to get by. My children own several businesses and are very successful, and to their credit they compensate their employees very well with incentive bonuses if the company thrives.
Got to disagree on the bolded part. Employees are valued based upon what their skill set is worth to any potential employer. The rarer or more difficult to replace the skill set, the greater the value to the employer and the greater the compensation. That the employee adds to the profitability of the company relates more to whether the position or employee will be retained.

[justjim]

I don't believe anybody believes that fast food minimum wages is going to $15.00 hr in one big jump. Just ain't going to happen. However, is it reasonable, manageable and possible over a five or six year period.

Many States are already paying wages above the Federal Minimum wage. The cost of living is certainly different in places like New York, L.A. And Chicago than places like Jonesboro, Dothan and Leesburg. A good day's pay for a good day of work. Everyone who is able should work----And have the opportunity to make a decent wage.

[eweissenbach]

I don't believe anybody believes that fast food minimum wages is going to $15.00 hr in one big jump. Just ain't going to happen. However, is it reasonable, manageable and possible over a five or six year period.

Many States are already paying wages above the Federal Minimum wage. The cost of living is certainly different in places like New York, L.A. And Chicago than places like Jonesboro, Dothan and Leesburg. A good day's pay for a good day of work. Everyone who is able should work----And have the opportunity to make a decent wage.

Very reasonable post Jim.

[janmcn]

Did you ever ask him how much he had to risk in order to buy that franchise? His employees are being paid what they are worth. and in many cases, based on my experience, they are getting more then they are worth. What does his income have to do with anything? Why should he give people money for nothing?

And while your at it, ask him how much he gives to charitiy and how much he pays for taxes each year.

Paying people to work is not giving people money for nothing. Anybody that works a 40 hour week should not have to live below the poverty line. It is the taxpayers that are subsidizing these businesses by providing food stamps and other programs, which by the way, these workers qualify for by virtue of their income. And this includes many employees who work for The Villages and other vendors in this area.

[buggyone]

Justjim says it correctly. Minimum wage is not planned to double in one fell swoop - or is it a swell foop? It would take a few years to fully implement.

Prices do increase naturally. So what? Your Social Security goes up, too. I can afford to pay another quarter for a beer at Cody's.

[tippyclubb]

If people are demanding higher wages, doesn't that mean they are working? If people are working, how does that mean they want something for nothing?


They want a $7 a hour increase in pay doing the exact same job they were hired to do at minimum wage. Yep, they expect something for nothing.

[waynet]

and the rich keep getting richer. And it's only the rich. the Mcdee worker is not alone. Even skilled workers are not benefitting froma better economy.

[tcxr750]

I get nostalgic when I recall making 75 cents per hour at Mcdonald's. Then I joined the Air Force and made $87 per month (1964). When technology replaces people think of the bright side of this event. The companies that manufacture and use this technology will have an increase in shareholder value. Our diversified portfolio of investments will increase in value. When we die our investments will then be passed on to our underemployed heirs. Just make sure its in a tax sheltered investment!

[tippyclubb]

and the rich keep getting richer. And it's only the rich. the Mcdee worker is not alone. Even skilled workers are not benefitting froma better economy.

Not once has a poor man gave me or my husband a job. Come to think of it I don't know anyone who works for poor people. Rich people provide jobs and if it weren't for them we would not be retiring.

[eweissenbach]

I see a lot of "I've got mine - up yours" attitude on this issue. There are lazy, unmotivated people working at minimum wage jobs, just as there are in many higher paid occupations. There are also many well educated and well qualified people who have been forced to work minimum wage jobs because their formerly well paid jobs were eliminated and there is a glut of overqualified people looking for work. There are also many single mothers and fathers trying their best to provide for their family and that's the best job available to them. If the lower end of the income is raised it provides more money to purchase goods, generating a multiplier effect in the economy, and less welfare/food stamps, not to mention more tax revenue. A rising tide lifts all ships.

[Hancle704]

Granted $8.30 an hour is too little but $15.00 is nearly double. I know people who are admins, nurses aides, data entry clerks, etc. that don't make $15.00 an hour.

And most of those jobs require some education and skills beyond what is required in fast foods. Just wondering, since it has not been mentioned, what is the hourly wage currently paid for the supervisor and manager of these fast food places? Certainly they have more experience, training and responsibilities than the worker who now wants $15/hour for doing less.

What portion of the $15 will go to the union?

[allus70]

It seems perhaps we are overlooking a fundamental law of capitalism... that of supply and demand. If a particular skill set is in demand, and there is a shortage of that particular skill set, wages will rise.
Conversely, if a skill set is not in demand, or there is an overabundance of people with that skill set seeking employment, wages will fall.
We are now at a point where most of the jobs in this country which require a modest skill set have been shipped overseas or have been automated, while at the same time the size of the pool of people with these minimal skills looking for work have dramatically increased. The law of supply and demand at this level is brutally valid because there will always be many more people looking for these jobs than there will be jobs available, meaning wages will not rise, or if they do, the rise will be minimal at best.
A burger joint typically does not offer any benefits or pay above the minimum rate. In many parts of this country, there are many people without any skills and are so desperate for a job that they will take any job at any pay rate just to survive.
We as a country have to decide, is it desirable to allow the law of supply and demand to play out and have a large portion of our citizens permanently tethered to very low wages without any benefits? Does it help or hurt our economy? Who will pay for their food and medical care when they can't?
Or does the government have a role in raising wages because the usual economic forces that do so are no longer at work.
What about the mom and pop stores, will they be hurt? Will teens looking for a summer job have a harder time doing so?
As for the political ramifications, Democrats are not alone calling for a raise, such well known Conservatives as Bill O'Reilly, Mitt Romney, and Phyllis Schlafly are in agreement with the Democrats on this issue.

[B767drvr]

If the lower end of the income is raised it provides more money to purchase goods, generating a multiplier effect in the economy, and less welfare/food stamps, not to mention more tax revenue. A rising tide lifts all ships.

If a rising tide (higher minimum wage) lifts all boats, then why not send those boats to the moon and raise the minimum wage to $50 or even $100 per hour? This should really give the economy a boost and lift those making minimum wage well into the middle class, no? :crap2:

[Nightengale212]

I am a 36 year R.N. living and working in R.I. which healthcare is the largest employer in my state. A significant number of the healthcare work force in my state are "certified" nursing assistants that make in the $15.00 or lower range which their duties are both physically and mentally demanding. If the minimum wage goes to $15.00/hr what happens to these "certified" extremely hard working individuals that are providing the bulk of hands on care in hospitals, nursing homes, and home care ? I'll tell you what will happen, these workers will all say adios to healthcare work because for the same pay it is far easier on the back to flip a burger than flip a patient.

[Challenger]

In economics as in Physics , all actions produce reactions. Laws setting prices or wages most often have adverse consequences when all things are considered. :spoken:

[graciegirl]

I see a lot of "I've got mine - up yours" attitude on this issue. There are lazy, unmotivated people working at minimum wage jobs, just as there are in many higher paid occupations. There are also many well educated and well qualified people who have been forced to work minimum wage jobs because their formerly well paid jobs were eliminated and there is a glut of overqualified people looking for work. There are also many single mothers and fathers trying their best to provide for their family and that's the best job available to them. If the lower end of the income is raised it provides more money to purchase goods, generating a multiplier effect in the economy, and less welfare/food stamps, not to mention more tax revenue. A rising tide lifts all ships.

The sad truth is, that people are not born equal. Not everyone has the same IQ and emotional control and personality characteristics and physical abilities needed to be a surgeon or an engineer or a high school coach NO MATTER HOW THEY TRY.

Lazy, unmotivated people in well paid jobs do not keep their jobs for long unless they work for the government or are in a tenured position that sadly doesn't weed all of them out quickly. There is more cause and effect, faster in free enterprise.

( EDITED) I just got a PM from a friend who worked in a government job who took umbrage. Naturally I don't mean ALL, but I mean TOO MANY)

And economics is not based on compassion, it is based on hard facts.

And there are many reading this that worked two jobs to get started way back when, because they didn't for many GOOD reasons (post depression era/ lack of money) go to college. There are many who are reading this who had salaried jobs that worked 12 hours a day or more...just because that job didn't require it, but the task did.

The response..."I've got mine-up yours" to me means misunderstanding the situation and dismissing the issue angrily. I don't expect anything from others that I would not expect from myself or from my children.

The economy is not based on empathy and kindness. Most of us have taught our children to work hard, save your money, do without, do it yourself, if you can't afford it today you can't pay for it next month, don't smoke, you can't afford it, stay off drugs etc. etc. etc. We are not entitled to anything that we cannot provide for ourselves unless we are sick or REALLY physically or mentally disabled.

Passing minimum wage job laws is not the answer. The people who choose not to work for eight bucks an hour are not going to work for sixteen either.

[coconutmama]

In my day these jobs were for people to supplement their income, or for teenagers to gain work experience. $15.00/hr is too high. As another poster stated, many admins, bookkeepers etc. with skills do not make that much. Yes, I'm glad the fast food workers are working & not on welfare, but in my view these jobs should be seen as temporary & not a "career" to raise a family on. Go to night school & move yourself up! Wait to have a family until you make something of yourself. What is the incentive to do so, if the government dictates your raises to obtain votes, at the expense of inflation for the rest of us who worked our way up in this world. Ok. I'm off my soapbox now. Have a great day everyone!

[janmcn]

In my day these jobs were for people to supplement their income, or for teenagers to gain work experience. $15.00/hr is too high. As another poster stated, many admins, bookkeepers etc. with skills do not make that much. Yes, I'm glad the fast food workers are working & not on welfare, but in my view these jobs should be seen as temporary & not a "career" to raise a family on. Go to night school & move yourself up! Wait to have a family until you make something of yourself. What is the incentive to do so, if the government dictates your raises to obtain votes, at the expense of inflation for the rest of us who worked our way up in this world. Ok. I'm off my soapbox now. Have a great day everyone!


How do you explain that a well run company like Costco can pay its employees a starting salary of $15, while Sam's only pays $7.25? There goes the theory that higher wages means higher prices. Where do you think you will get better customer service?

With the economy improving, and the unemployment rate now at 6.1%, these companies like Sam's will go begging for help. Don't be surprised to see only retired people supplementing their incomes on your next visit to Sam's.

[dave harris]

"First, most of the people protesting do not work" I'm always amazed at people who make statements like this. Do you have documentation on this, know the people, have inside information? If you do please state them.

[JCMSr]

Having owned my own construction company for many, many years I can honestly say that I do not remember ever paying anyway minimum wage for more than the first week. Anyone who is willing to work, shows that they are dependable and willing to listen and learn always earned more than minimum wage. Those who thought they "deserved" more than minimum wage just by showing up whenever it fit their schedule did not continue to fill the slot better offered to someone who really wanted to work. Everyone deserves an opportunity to show what they are worth and get the experience needed to move up but it is a two way street. It was always amazing to me the number of employees that we had who were good workers but never had the desire to take on more responsibility to move up. Those same people were the first ones to complain when they did not get a raise down the line.

When did the minimum wage become the "living wage". I'm probably showing my age now but when I began my career minimum wage was the rate used for those with absolutely no work experience who wanted to work. Even those who decided to drop out of school and were too lazy to learn a trade never had the guts to "demand" that they deserved $30,000+ a year to start.

[graciegirl]

How do you explain that a well run company like Costco can pay its employees a starting salary of $15, while Sam's only pays $7.25? There goes the theory that higher wages means higher prices. Where do you think you will get better customer service?

With the economy improving, and the unemployment rate now at 6.1%, these companies like Sam's will go begging for help. Don't be surprised to see only retired people supplementing their incomes on your next visit to Sam's.

Read this. Costco Wholesale Hourly Pay | Glassdoor (http://www.glassdoor.com/Hourly-Pay/Costco-Wholesale-Hourly-Pay-E2590.htm)

And read this. http://www.glassdoor.com/Hourly-Pay/Sam-s-Club-Hourly-Pay-E7811.htm

[dewilson58]

How do you explain that a well run company like Costco can pay its employees a starting salary of $15, while Sam's only pays $7.25? There goes the theory that higher wages means higher prices. Where do you think you will get better customer service?

With the economy improving, and the unemployment rate now at 6.1%, these companies like Sam's will go begging for help. Don't be surprised to see only retired people supplementing their incomes on your next visit to Sam's.

Grace shared good data. $7.25 has not been valid for Sam's for a long time. There is some wage difference, but there is also a difference on what the two companies return to their stockholders. I think WMT is running 6% and COST is about 3.5%. (I haven't looked lately)


6.1% "unemployment"..................the world has changed and the old unemployment rate is not valid any more. Need to look at other data points. So many more (at historical highs) not included in the old unemployment calculation are not employed or underemployed.

WalMart is returning a 6% EPS to their stock holders and Costco is at less than 4%. (Just quick numbers from 10,000 feet)

[graciegirl]

Only refrigerator magnet we have.

Youngest daughter in her first job. Proud of her then. Proud of her now. She was 49 yesterday.

[dewilson58]

Only refrigerator magnet we have.

Youngest daughter in her first job. Proud of her then. Proud of her now.

OMG

SO COOL!!

:pepper2:

[Rags123]

Grace shared good data. $7.25 has not been valid for Sam's for a long time. There is some wage difference, but there is also a difference on what the two companies return to their stockholders. I think WMT is running 6% and COST is about 3.5%. (I haven't looked lately)


6.1% "unemployment"..................the world has changed and the old unemployment rate is not valid any more. Need to look at other data points. So many more (at historical highs) not included in the old unemployment calculation are not employed or underemployed.

WalMart is returning a 6% EPS to their stock holders and Costco is at less than 4%. (Just quick numbers from 10,000 feet)


For those who see all issues facing this country in ONLY a political prism, the quoting of the minimum wage for current workers is simply a ploy.

In actual practice only about 2 percent of the current work force earns the minimum wage. Of those less than .3 of 1 percent, as a couple or family, are both under poverty. That means there are a lot of teens earning minimum wage and most are parttime.

Clouding this issue does no good.....income equality is best treated with people going to work.

[janmcn]

Grace shared good data. $7.25 has not been valid for Sam's for a long time. There is some wage difference, but there is also a difference on what the two companies return to their stockholders. I think WMT is running 6% and COST is about 3.5%. (I haven't looked lately)


6.1% "unemployment"..................the world has changed and the old unemployment rate is not valid any more. Need to look at other data points. So many more (at historical highs) not included in the old unemployment calculation are not employed or underemployed.

WalMart is returning a 6% EPS to their stock holders and Costco is at less than 4%. (Just quick numbers from 10,000 feet)


Do you really think consumers or job seekers really give a hoot what the EPS (whatever that is) to a companies stock holders when they are deciding where to shop or where to seek employment? People are looking for the best value for their dollars (most of the time) or the best place to work to earn a fair wage.

And the unemployment rate is the unemployment rate reported monthly by the Department of Labor. Many working people and people looking for work don't have the time to study the other data points, IMO.

[graciegirl]

[QUOTE=janmcn;933593]Do you really think consumers or job seekers really give a hoot what the EPS (whatever that is) to a companies stock holders when they are deciding where to shop or where to seek employment? People are looking for the best value for their dollars (most of the time) or the best place to work to earn a fair wage.UNQUOTE




No I don't. But it explains how they run their business on this issue that we are discussing, right NOW.

[sunnyatlast]

I am a 36 year R.N. living and working in R.I. which healthcare is the largest employer in my state. A significant number of the healthcare work force in my state are "certified" nursing assistants that make in the $15.00 or lower range which their duties are both physically and mentally demanding. If the minimum wage goes to $15.00/hr what happens to these "certified" extremely hard working individuals that are providing the bulk of hands on care in hospitals, nursing homes, and home care ? I'll tell you what will happen, these workers will all say adios to healthcare work because for the same pay it is far easier on the back to flip a burger than flip a patient.

"If the minimum wage goes to $15.00/hr what happens to these "certified" extremely hard working individuals…... these workers will all say adios to healthcare work because for the same pay it is far easier on the back to flip a burger than flip a patient."

Not to mention the mindlessness of flipping a burger!

And not to mention the qualifications and training it takes for a skilled person to step in as a substitute when the nursing assistant is absent due to illness etc. At McD's, ANY body that's breathing behind the counter can step in and flip burgers or wrap them in paper. Not so with SKILLED nursing and technical jobs that pay $15/hour.

Workers should be paid for what they are worth, and many making $7.25 aren't even worth $4. The biggest problem employers of fast-food workers have is just getting them to show up at every shift, much less getting them to produce reliably.

[dewilson58]

Do you really think consumers or job seekers really give a hoot what the EPS (whatever that is) to a companies stock holders when they are deciding where to shop or where to seek employment? People are looking for the best value for their dollars (most of the time) or the best place to work to earn a fair wage.

And the unemployment rate is the unemployment rate reported monthly by the Department of Labor. Many working people and people looking for work don't have the time to study the other data points, IMO.

I don't think it makes seekers hoot. Never said that. The EPS reference was to assist in the confused state of "how do you explain" comment. The EPS is one component to explain how two companies with the same product profile and pricing MIGHT be able to have two different wage structures.

The unemployment rate posted monthly by the DOL.......Yep. Been that way for 60, 70 years......nothing new there. An old governmental agency using an out-dated formula that is not relevant to today's economy.

Never said who or how many people have time to study data, but if people take and use data, they probably should understand it. Current economist and financial professionals advance with the times and use appropriate data and information. Not just was is easy to find in the headlines.

Have a Great Friday!!!

[Bavarian]

"If the minimum wage goes to $15.00/hr what happens to these "certified" extremely hard working individuals…... these workers will all say adios to healthcare work because for the same pay it is far easier on the back to flip a burger than flip a patient."

Not to mention the mindlessness of flipping a burger!

And not to mention the qualifications and training it takes for a skilled person to step in as a substitute when the nursing assistant is absent due to illness etc. At McD's, ANY body that's breathing behind the counter can step in and flip burgers or wrap them in paper. Not so with SKILLED nursing and technical jobs that pay $15/hour.

Workers should be paid for what they are worth, and many making $7.25 aren't even worth $4. The biggest problem employers of fast-food workers have is just getting them to show up at every shift, much less getting them to produce reliably.

You have revealed the true reason for raising the minimum wage to $15./hr. It will cause other wages, such as Nursing Assistants to go up also. They will rightly demand a raise based on now earning same as Minimum wage paid to unskilled entry level jobs flipping burgers or sweeping floors.

[Indydealmaker]

You have revealed the true reason for raising the minimum wage to $15./hr. It will cause other wages, such as Nursing Assistants to go up also. They will rightly demand a raise based on now earning same as Minimum wage paid to unskilled entry level jobs flipping burgers or sweeping floors.

When the value of anything is artificially inflated, you will find that the resulting ancillary inflation wipes out any of the originally sought benefits.

An employee making $7/hr who is magically lifted to $15/hr will soon find that he is no better off than before.

The economy is a big pie. The Cost of Living will adjust upwards as a result of the artificial manipulation. The rampant inflation around the oil fields of North Dakota is a working example of this theory.

Everybody needs to put aside their hearts for just a moment and do some critical thinking. A job/function is worth only what the employer is willing to pay. This does not devalue the individual employee. Only they can do that to themselves as a result of many poor, ill-advised decisions of their own and their parents.

Arbitrarily paying them more than the job is worth does not magically make the individual more valuable and you will find that water seeks its own level. Many of the characteristics and circumstances that put the employee at the minimum wage level will still exist and they will lose their new found $$ to people with better work ethic who have been forced down by layoffs and job attrition.

Many, many people earning minimum wage have true potential to advance, but they are likely to do so based on their own initiative.

[sunnyatlast]

When the value of anything is artificially inflated, you will find that the resulting ancillary inflation wipes out any of the originally sought benefits.

An employee making $7/hr who is magically lifted to $15/hr will soon find that he is no better off than before.

The economy is a big pie. The Cost of Living will adjust upwards as a result of the artificial manipulation. The rampant inflation around the oil fields of North Dakota is a working example of this theory.

Everybody needs to put aside their hearts for just a moment and do some critical thinking. A job/function is worth only what the employer is willing to pay. This does not devalue the individual employee. Only they can do that to themselves as a result of many poor, ill-advised decisions of their own and their parents.

Arbitrarily paying them more than the job is worth does not magically make the individual more valuable and you will find that water seeks its own level. Many of the characteristics and circumstances that put the employee at the minimum wage level will still exist and they will lose their new found $$ to people with better work ethic who have been forced down by layoffs and job attrition.

Many, many people earning minimum wage have true potential to advance, but they are likely to do so based on their own initiative.

Excellent post!

Here is a link to "Characteristics of Minimum Wage Workers" by the U.S. Bureau of Labor Statistics.

Two of many points shown:

"Minimum wage workers tend to be young. Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up about half of those paid the Federal minimum wage or less.

Among employed teenagers paid by the hour, about 21 percent earned the minimum wage or less, compared with about 3 percent of workers age 25 and over."
----------

"The industry with the highest proportion of workers with hourly wages at or below the federal minimum wage was leisure and hospitality (about 19 percent).

About half of all workers paid at or below the federal minimum wage were employed in this industry, the vast majority in restaurants and other food services. For many of these workers, tips and commissions supplement the hourly wages received."

See full report here:

Characteristics of Minimum Wage Workers: 2012 (http://www.bls.gov/cps/minwage2012.htm)

[Pointer]

I see a lot of "I've got mine - up yours" attitude on this issue. There are lazy, unmotivated people working at minimum wage jobs, just as there are in many higher paid occupations. There are also many well educated and well qualified people who have been forced to work minimum wage jobs because their formerly well paid jobs were eliminated and there is a glut of overqualified people looking for work. There are also many single mothers and fathers trying their best to provide for their family and that's the best job available to them. If the lower end of the income is raised it provides more money to purchase goods, generating a multiplier effect in the economy, and less welfare/food stamps, not to mention more tax revenue. A rising tide lifts all ships.

Well said!

[Villages PL]

I'm waiting for someone to invent a robot that can make a really good vegan salad.

[MikeV]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare. He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.

Are you very sure he gets that standard of living from owning 1 McDonalds Franchise. My bet is he has a lot more that one store in his holdings.

[buggyone]

Some posters seem to be misunderstanding the situation. IF there is a doubling of the minimum wage from $7.50 to $15, it is going to phase in over a few years.

Also, it is not only for McDonald's workers but for a vast number of minimum wage jobs.

Other wages will follow suit and rise also. $15 per hour will become the new $7.50 per hour and other wages will go up accordingly. Of course, prices to consumers will go up. No one is actually a winner.

[dewilson58]

Some posters seem to be misunderstanding the situation. IF there is a doubling of the minimum wage from $7.50 to $15, it is going to phase in over a few years.

Also, it is not only for McDonald's workers but for a vast number of minimum wage jobs.

Other wages will follow suit and rise also. $15 per hour will become the new $7.50 per hour and other wages will go up accordingly. Of course, prices to consumers will go up. No one is actually a winner.


In a nutshell.

:wave:

[graciegirl]

Well, I know the local MacDonalds franchisee. He lives in a million dollar home and drives a Mercedes, while his employees are mostly living in poverty and/or on welfare.(???)He deserves to make a nice return on his investment and risk, but it seems to me that there is a little left to go to the people who make him his money. BTW, he seldom is seen in the store.



Opening a McDonald's: Franchise Costs and Requirements (http://franchises.about.com/od/mostpopularfranchises/a/mcdonaldscosts.htm)

AND...Even when my kids worked at McDonalds it was hard to know all of the employees economic circumstances. I think that depends on a lot of things. The important thing to me is that they are working.

[NYGUY]

I will keep my 2 cents regarding the minimum wage but I do like the robot idea....a consistently made product would be great!!:pray:

[Rags123]

Another stat and number we might want to work on....

" A record 92,269,000 Americans 16 and older did not participate in the labor force in August, as the labor force participation rate matched a 36-year low of 62.8 percent, according to the Bureau of Labor Statistics.

The labor force participation rate has been as low as 62.8 percent in six of the last twelve months, but prior to last October had not fallen that low since 1978.

BLS employment statistics are based on the civilian noninstitutional population, which consists of all people 16 or older who were not in the military or an institution such as a prison, mental hospital or nursing home."

Record 92,269,000 Not in Labor Force; Participation Rate Matches 36-Year Low | CNS News (http://www.cnsnews.com/news/article/ali-meyer/record-92269000-not-labor-force-participation-rate-matches-36-year-low)

[TexaninVA]

Those fast-food workers striking for a $15 minimum wage might soon find themselves REPLACED altogether!

What's the nation going to do with all the unskilled labor out there? Is this society's problem, or an individual's problem?


>>
A company called Momentum Machines has built a robot that could radically change the fast-food industry and have some line cooks looking for new jobs.

The company's robot can "slice toppings like tomatoes and pickles immediately before it places the slice onto your burger, giving you the freshest burger possible." The robot is "more consistent, more sanitary, and can produce ~360 hamburgers per hour." That's one burger every 10 seconds.

The next generation of the device will offer "custom meat grinds for every single customer. Want a patty with 1/3 pork and 2/3 bison ground to order? No problem."

Momentum Machines cofounder Alexandros Vardakostas told Xconomy his "device isn’t meant to make employees more efficient. It’s meant to completely obviate them." Indeed, marketing copy on the company's site reads that their automaton "does everything employees can do, except better."



Read more: Momentum Machines Burger Robot - Business Insider (http://www.businessinsider.com/momentum-machines-burger-robot-2014-8#ixzz3CNJnKZLn)

<<

The saddest part to me is the uneducated workers don't have a clue
about economics nor the market reaction to a "demand" to double
their wages. This also gives unscrupulous union leaders and politicians
a perfect opportunity to demagogue

[B767drvr]

The saddest part to me is the uneducated workers don't have a clue
about economics nor the market reaction to a "demand" to double
their wages.

Both of your points are excellent.

Speaking to this one… the "price inelasticity of demand"… is going to be an eye opener for some. Fast-food restaurants typically run on tight margins and high labor costs. Doubling your labor costs (even if phased in) will result in sharply higher food prices. At $12-15 for a "Happy Meal", you can bet demand will fall. This is Econ 101 stuff. Artificially higher wages without a commensurate productivity increase will result in higher costs and higher prices (suppressing demand).

Finally… higher costs and reduced demand (sales) will ultimately lead to reduced demand for labor (job cuts/reduced hours). If that mechanism is insufficient, then the business fails. :wave:

[eweissenbach]

Seattle Times article about effects of minimum wage raise.
Studies look at what happened when cities raised minimum wage | Local News | The Seattle Times (http://seattletimes.com/html/localnews/2023116005_wageimpactsxml.html)

[eweissenbach]

Both of your points are excellent.

Speaking to this one… the "price inelasticity of demand"… is going to be an eye opener for some. Fast-food restaurants typically run on tight margins and high labor costs. Doubling your labor costs (even if phased in) will result in sharply higher food prices. At $12-15 for a "Happy Meal", you can bet demand will fall. This is Econ 101 stuff. Artificially higher wages without a commensurate productivity increase will result in higher costs and higher prices (suppressing demand).

Finally… higher costs and reduced demand (sales) will ultimately lead to reduced demand for labor (job cuts/reduced hours). If that mechanism is insufficient, then the business fails. :wave:

According to the article I linked from the Seattle Times, the cost of restaurant food rose 2-3% in cities where the minimum wage was raised. Even at 5% the cost of a Happy Meal may go from $4.00 to $4.20. This is Econ 101 stuff.

[graciegirl]

According to the article I linked from the Seattle Times, the cost of restaurant food rose 2-3% in cities where the minimum wage was raised. Even at 5% the cost of a Happy Meal may go from $4.00 to $4.20. This is Econ 101 stuff.

In Cincinnati, Ohio, a quarter pounder with cheese sells for two-something and in San Francisco it sells for four something.

http://www.nerdwallet.com/blog/cities/economics/quarter-pounder-index-most-least-expensive-cities/

[SheilaO]

The sad truth is, that people are not born equal. Not everyone has the same IQ and emotional control and personality characteristics and physical abilities needed to be a surgeon or an engineer or a high school coach NO MATTER HOW THEY TRY.

Lazy, unmotivated people in well paid jobs do not keep their jobs for long unless they work for the government or are in a tenured position that sadly doesn't weed all of them out quickly. There is more cause and effect, faster in free enterprise.

( EDITED) I just got a PM from a friend who worked in a government job who took umbrage. Naturally I don't mean ALL, but I mean TOO MANY)

And economics is not based on compassion, it is based on hard facts.

And there are many reading this that worked two jobs to get started way back when, because they didn't for many GOOD reasons (post depression era/ lack of money) go to college. There are many who are reading this who had salaried jobs that worked 12 hours a day or more...just because that job didn't require it, but the task did.

The response..."I've got mine-up yours" to me means misunderstanding the situation and dismissing the issue angrily. I don't expect anything from others that I would not expect from myself or from my children.

The economy is not based on empathy and kindness. Most of us have taught our children to work hard, save your money, do without, do it yourself, if you can't afford it today you can't pay for it next month, don't smoke, you can't afford it, stay off drugs etc. etc. etc. We are not entitled to anything that we cannot provide for ourselves unless we are sick or REALLY physically or mentally disabled.

Passing minimum wage job laws is not the answer. The people who choose not to work for eight bucks an hour are not going to work for sixteen either.

AMEN! There are 'cons' on both sides, so what is our priority? Mine, is that individuals have responsibility, accountability and hard work to make the most of who they are….I don't believe anyone does well when everything is handed to them.

[eweissenbach]

AMEN! There are 'cons' on both sides, so what is our priority? Mine, is that individuals have responsibility, accountability and hard work to make the most of who they are….I don't believe anyone does well when everything is handed to them.

This isn't about everything being handed to them. These are people who are working, trying to make their way, this is not about "welfare queens", or freeloaders. Granted, some are not worth the $7.25 or so they're getting, and they would likely be casualties of a higher minimum wage that would attract more motivated workers. Most people, me included, are not advocating an immediate raising of the minimum wage to $15, but rather a phased in increase over 5 years or so. Responsibly, accountability, and hard work are admirable goals, but opportunity is the missing issue for many people. Most of the people who post on this website never lacked for opportunity.

[Indydealmaker]

This isn't about everything being handed to them. These are people who are working, trying to make their way, this is not about "welfare queens", or freeloaders. Granted, some are not worth the $7.25 or so they're getting, and they would likely be casualties of a higher minimum wage that would attract more motivated workers. Most people, me included, are not advocating an immediate raising of the minimum wage to $15, but rather a phased in increase over 5 years or so. Responsibly, accountability, and hard work are admirable goals, but opportunity is the missing issue for many people. Most of the people who post on this website never lacked for opportunity.

Most of the posters herein created their own opportunities. Most of all of us have had minimum wage jobs at one time. It is EASY today to stand out to your employer! Easy to get the better job because so many people are total slackers. The least little bit of extra effort will catch the boss' attention like a scream in library.

[B767drvr]

According to the article I linked from the Seattle Times, the cost of restaurant food rose 2-3% in cities where the minimum wage was raised. Even at 5% the cost of a Happy Meal may go from $4.00 to $4.20. This is Econ 101 stuff.

Also according to that article…

>>
“When talking about a $15 minimum wage, you’re going to a level that’s somewhat unprecedented,” said Michael Saltsman, research director for the Employment Policies Institute, which is partially funded by the restaurant industry.

“A 60 percent increase in labor costs doesn’t just wipe out profits at a typical restaurant, it wipes them out four times over,” he said.

<<

Again I ask you… if $15 per hour minimum wage will have no impact, why not raise it to $50 or even $100 per hour? Why keep these hard-working people oppressed? Why not just legislate them solidly into the middle class?

Can't wait to hear your Econ 101 reasoning… :wave:

[BarryRX]

I have a personal story to share that is relevant because it involves a fast food franchise, namely Burger King. My brother in law just turned 56 years old a few months ago and he has already been retired for 10 years. He graduated SUNY at Stonybrook in the 1970's with a BS degree in Pyschology. Now, about the only job he could get with a BS in Pyschology was flipping burgers for Burger King. He moved up over the course of the years from worker, to night manager, to day manager, to store manager. From there he became an Area Manager and then a District Manager. Burger King sent him to an abbreviated MBA course at Univ. of Pennsylvania. When Burger King decided to open up Europe, they picked him to do it. He moved his pregnant wife and infant daughter to England. My nephew was born over there. He spent two years traveling all over Europe. If you ever go to a BK in Europe, he was probably responsible for opening it. Because of Burger kings ex-pat package, he was also able to bank a good deal of his salary in those 2 years. He came back to the States and was made a Vice President. After 2 years, Burger King decided to open up business in Asia, and because of his previous international experience they picked him to do it. He and his wife and 3 children moved to Tokyo for the next 3 years. While there he traveled the entire Pacific Rim opening up Burger Kings. His youngest child often answered the phone "Moshe Moshe". When he returned he became a senior Vice President and a few years after that took his golden parachute and retired at age 46 and is probably worth a lot more than I am. So, it doesn't matter what his starting pay was as a beginner burger flipper. His drive and hard work (and probably a little bit of luck along the way) made him a wealthy man. Perhaps if robots were flipping burgers back then he may have never been hired by Burger King. But I am absolutely positive that he would have had the same success at anything he did. I've always had a bit of wanderlust, and because of that I've done a bunch of things in my life. I've been successful as a retail pharmacist as well as being quite successful in pharmaceutical manufacturing, quality assurance, and orthopedic sales. I was also a bit lucky along the way. We've all seen great workers laid off as the result of a merger while some so so workers kept their jobs. That's all part of the lottery of life. The minimum wage in 1963 was $1.25/hour, which is equivalent to $9.73/hour now, not the $7.25 that we pay. We should at least raise it to $9.73 to keep pace with inflation, since inflation hurts poor people the most.
Edit: I just wanted to add that he is one of the nicest people I have ever had the pleasure to know. While not a prerequisite for success, I find that it often goes hand in hand with it.

[tomwed]

This was copied from the McDonalds site.
“Since the total cost varies from restaurant to restaurant, the minimum amount for a down payment will vary. Generally, we require a minimum of $750,000 of non-borrowed personal resources to consider you for a franchise. Individuals with additional funds may be better prepared for additional or multi-restaurant opportunities.”

OK== let’s do the math.

If you make $7.50 an hour and started saving your money, you would need to work $750,000/$7.5= 100,000 hours to buy your own McDonalds.
When I was a junior in HS [1968] the minimum wage was $1.60 an hour. Do you think a McDonalds franchise in 1968 cost anything close to $160,000 [$1.60 x 100,000 hours = $160,000] My hunch is that a franchise cost closer to $40,000. I could not find that number online.

Cost Of Living 1968 How Much things cost in 1968
Yearly Inflation Rate USA 4.27%
Average Cost of new house $14,950.00
Average Income per year $7,850.00
Average Monthly Rent $130.00
Gas per Gallon 34 cents
Average Cost of a new car $2,822.00
Movie Ticket$1.50
NJ College $175/semester state college $250/semester Rutgers University
The Federal Hourly Minimum Wage is $1.60 an hour

I got mine now you get yours holds true when the cost of living is proportionate.

And don’t get me wrong. I don’t begrudge the guy that owns the McDonalds a single dime. My aunt and uncle owned 2 Dairy Queens. They worked 12 hour days, 7 days a week with all my cousins helping when they were not in school. I’d be quite surprised if that family didn’t work just as hard and take just as many risks.

I don’t know what the solution is but people my age [boomers] were privileged because of the sacrifices of our parent’s generation in addtion to the political and economic decisions made by our elders. I will always be in their debt.

[sunnyatlast]

I have a personal story to share that is relevant because it involves a fast food franchise, namely Burger King. My brother in law just turned 56 years old a few months ago and he has already been retired for 10 years. He graduated SUNY at Stonybrook in the 1970's with a BS degree in Pyschology. Now, about the only job he could get with a BS in Pyschology was flipping burgers for Burger King. He moved up over the course of the years from worker, to night manager, to day manager, to store manager. From there he became an Area Manager and then a District Manager. Burger King sent him to an abbreviated MBA course at Univ. of Pennsylvania. When Burger King decided to open up Europe, they picked him to do it. He moved his pregnant wife and infant daughter to England. My nephew was born over there. He spent two years traveling all over Europe. If you ever go to a BK in Europe, he was probably responsible for opening it. Because of Burger kings ex-pat package, he was also able to bank a good deal of his salary in those 2 years. He came back to the States and was made a Vice President. After 2 years, Burger King decided to open up business in Asia, and because of his previous international experience they picked him to do it. He and his wife and 3 children moved to Tokyo for the next 3 years. While there he traveled the entire Pacific Rim opening up Burger Kings. His youngest child often answered the phone "Moshe Moshe". When he returned he became a senior Vice President and a few years after that took his golden parachute and retired at age 46 and is probably worth a lot more than I am. So, it doesn't matter what his starting pay was as a beginner burger flipper. His drive and hard work (and probably a little bit of luck along the way) made him a wealthy man. Perhaps if robots were flipping burgers back then he may have never been hired by Burger King. But I am absolutely positive that he would have had the same success at anything he did. I've always had a bit of wanderlust, and because of that I've done a bunch of things in my life. I've been successful as a retail pharmacist as well as being quite successful in pharmaceutical manufacturing, quality assurance, and orthopedic sales. I was also a bit lucky along the way. We've all seen great workers laid off as the result of a merger while some so so workers kept their jobs. That's all part of the lottery of life. The minimum wage in 1963 was $1.25/hour, which is equivalent to $9.73/hour now, not the $7.25 that we pay. We should at least raise it to $9.73 to keep pace with inflation, since inflation hurts poor people the most.
Edit: I just wanted to add that he is one of the nicest people I have ever had the pleasure to know. While not a prerequisite for success, I find that it often goes hand in hand with it.

Thank you for so aptly describing how The American Dream works. He did what was ASKED of him, and much more.

I'm constantly amazed at how people complain about "no jobs available" or the jobs "pay too little", but they will NOT move! Others will not accept a job that is "beneath their level" as they have a degree and are not going to lower themselves to flipping burgers or scrubbing floors. They expect employers to come to them and their town/city and GIVE them a job, instead of going out and looking for one elsewhere.

Very few of the complainers would move and sacrifice all that's familiar in their comfort zone, as your brother did. And if he has a nice Mercedes or BMW, more power to him. Everybody deserves some enjoyment after working/traveling that much, for so long. I know that the family sacrifices in that situation can be huge.

[BarryRX]

This was copied from the McDonalds site.
“Since the total cost varies from restaurant to restaurant, the minimum amount for a down payment will vary. Generally, we require a minimum of $750,000 of non-borrowed personal resources to consider you for a franchise. Individuals with additional funds may be better prepared for additional or multi-restaurant opportunities.”

OK== let’s do the math.

If you make $7.50 an hour and started saving your money, you would need to work $750,000/$7.5= 100,000 hours to buy your own McDonalds.
When I was a junior in HS [1968] the minimum wage was $1.60 an hour. Do you think a McDonalds franchise in 1968 cost anything close to $160,000 [$1.60 x 100,000 hours = $160,000] My hunch is that a franchise cost closer to $40,000. I could not find that number online.

Cost Of Living 1968 How Much things cost in 1968
Yearly Inflation Rate USA 4.27%
Average Cost of new house $14,950.00
Average Income per year $7,850.00
Average Monthly Rent $130.00
Gas per Gallon 34 cents
Average Cost of a new car $2,822.00
Movie Ticket$1.50
NJ College $175/semester state college $250/semester Rutgers University
The Federal Hourly Minimum Wage is $1.60 an hour

I got mine now you get yours holds true when the cost of living is proportionate.

And don’t get me wrong. I don’t begrudge the guy that owns the McDonalds a single dime. My aunt and uncle owned 2 Dairy Queens. They worked 12 hour days, 7 days a week with all my cousins helping when they were not in school. I’d be quite surprised if that family didn’t work just as hard and take just as many risks.

I don’t know what the solution is but people my age [boomers] were privileged because of the sacrifices of our parent’s generation in addtion to the political and economic decisions made by our elders. I will always be in their debt.

I see what you're saying, but some things are just not governed by inflation. The price of a McDonalds franchise is worth a lot more now than it was in 1964. The same is true of some of the other (but not all) of the items you mentioned. Supply and demand trumps inflation in many cases. In 1980 Apple stock was $22. Before the split a few months ago it was $600. It should be only $68 if accounting solely for inflation. But, one very important stat is true, and that is avg income. Income has been flat for the last decade which means that the working poor has lost about 35% of their spending power over that period. Actually, almost everyone has but it affects the poor the most.

[B767drvr]

According to the article I linked from the Seattle Times, the cost of restaurant food rose 2-3% in cities where the minimum wage was raised. Even at 5% the cost of a Happy Meal may go from $4.00 to $4.20. This is Econ 101 stuff.

I LOVE being schooled by learned Econ 101 profs!

So, if we go from $10 per hour to $100 per hour and extrapolate on your cited research… are we to believe we'd only see a 20-30% increase in the price of a Happy Meal following a 1000% increase in labor cost? Gosh I love your mathematics. Life truly is wonderful.

[slipcovers]

Barry, that is a wonderful story....but it sounds like his intention from the beginning was to own a franchise and working from the bottom up...however, there has to be money invested from someone for the purchase of the franchise. He would not get that making minimum wage.

[BarryRX]

Barry, that is a wonderful story....but it sounds like his intention from the beginning was to own a franchise and working from the bottom up...however, there has to be money invested from someone for the purchase of the franchise. He would not get that making minimum wage.

Hi Slipcovers, he never owned a franchise. He started work in a corporate BK and was always a corporate employee. That's an interesting question though...would he have had the same advancement opportunities if he had worked in a franchise BK? If I would go to work for a Mom and Pop Pharmacy, I would only be able to rise to a certain level. But if I went to work for Walgreens, I could eventually become CEO.

[eweissenbach]

I LOVE being schooled by learned Econ 101 profs!

So, if we go from $10 per hour to $100 per hour and extrapolate on your cited research… are we to believe we'd only see a 20-30% increase in the price of a Happy Meal following a 1000% increase in labor cost? Gosh I love your mathematics. Life truly is wonderful.

Maybe in beginning Econ you were taught that wages are only one component in the costs of running a business. Read the article. You're welcome.

[buggyone]

Both of your points are excellent.

Speaking to this one… the "price inelasticity of demand"… is going to be an eye opener for some. Fast-food restaurants typically run on tight margins and high labor costs. Doubling your labor costs (even if phased in) will result in sharply higher food prices. At $12-15 for a "Happy Meal", you can bet demand will fall. This is Econ 101 stuff. Artificially higher wages without a commensurate productivity increase will result in higher costs and higher prices (suppressing demand).

Finally… higher costs and reduced demand (sales) will ultimately lead to reduced demand for labor (job cuts/reduced hours). If that mechanism is insufficient, then the business fails. :wave:

You are right to some extent. Remember that other salaries and wages will rise commensurate to that higher minimum wage.

The minimum wage we might have made of $1.25 per hour in 1965 is now $7.50. The McDonald's meal of a burger, fries, and shake cost 45 cents back then. Basically, it was 25 minutes to buy that meal. Now that meal from the dollar menu, it costs $3.50 or takes approximately the same length of time to earn that meal at minimum wage.

As salaries rise, other prices follow. Remember, it is not only fast food restaurants to which the higher minimum wage applies.