What the Fifteen Dollar Minimum Wage Means for Cities
The debate over the $15 dollar minimum wage has two sides, one that believes that the higher wages will mean less jobs and the side that wants to see better incomes for employees in low skill jobs in America. Currently 2 states and 4 cities have passed laws to increase the minimum wage to this level over the next couple of years. This higher wage will have negative impacts on businesses and the workers that currently are employed there, while limiting the number of available jobs for young workers.
Franchise locations of the popular fast food chain McDonalds are everywhere and employee millions of American workers. But the franchises only keep 6 cents of every dollar of revenue that they generate, the rest goes to staff, food, rent, etc. A typical franchise has income of $2.6 million a year or $156,000. With this new minimum wage, 15 employees will cost the franchise 75% of its profit for the year. The company will attempt to increase revenue through price increases but customers are sensitive to these increases and lower wage earnings will be most affected by the increase in their purchases.
Things that will likely happen if/when the minimum wage is increased in your city:
1. Kiosks will be used to take orders at restaurants. Popular in Europe already.
2. Fewer jobs, possibly 1 million fewer jobs.
3. Fewer opportunities for young workers looking for a summer job. Currently over 50% of minimum wage workers are still able to stay on their parents health insurance.
Wendy's Wants to Automate Stores "Because of $15/Hour Minimum Wage Increase"