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Fast food industry, wage neglect and state of jobs

hudson 600You may have heard about the fast food strikes happening across the country in advocacy of raising minimum wage to $15 an hour. Workers here in Memphis even protested in early December. An estimated one in four Memphis workers is paid less than a living wage, according to Workers Interfaith Network.

Why would anyone ever think about paying fast food workers that much?

Well, everyone should be thinking about it! Why? Because more than half of fast food workers are also dependent on us, the taxpayer, for some form of public assistance to make ends meet, according to a recent study – Fast Food, Public Cost – conducted by Sylvia A. Allegretto.

The study points out that "nearly two-thirds (63 percent) of public benefits spending goes to working families – that is families with a working member. With jobs that put their earnings below subsistence needs, our measurements indicate that these families must rely on Medicaid, food stamps, the Earned Income Tax Credit and other support to provide the food, shelter and healthcare for which their jobs alone will not pay."

The fast food industry stands out for both its low wages and a lack of full time work hours. The median hourly wage for core non-managerial frontline fast food workers, those working at least 27 weeks in a year and 10 hours a week, is $8.77 an hour. The median hours for these jobs are 30. As a result, annual earnings in the fast food industry are well below the income needed for self-sufficiency.

Fast food industry jobs are also much less likely than other jobs to provide health benefits. Only 13 percent of core frontline fast food workers receive health benefits through their employer, compared to 59 percent of workers as a whole.

A data brief prepared by the National Employment Law Project points out that while the 10 largest fast food giants earned $7.4 billion in profits last year, they paid $53 million to their highest paid executives, distributed $7.7 billion in dividends and stock buybacks and cost the tax-payer $3.8 billion dollars.

In another time, when manufacturing was king, fast food jobs where great entry-level jobs. With the exodus of manufacturing jobs, the recession and the move towards a service economy, the average fast food worker is now 28-29 years old and may be a single parent with a high school diploma.

Fast food giants do not use the model popularized by many companies in which they pay part-time employees a wage significantly above minimum wage and offer full-time health benefits. And, if current trends continue, according to the Bureau of Labor Statistics, this may very well be the model of the future for persons with no more than a high school education, just behind jobs such as home health aid and in retail.

What are your thoughts on increasing minimum wage? And more importantly, how does this "new" model affect jobs here in the Bluff City?

(To reach Herbert Lester, email WORKFORCE READY! at This email address is being protected from spambots. You need JavaScript enabled to view it. )








0 #1 electrical 2014-06-28 00:59
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me when new comments are added- checkbox and from now on whenever a comment is added I receive 4 emails with the same comment.
There has to be a means you are able to remove me from that service?
Appreciate it!

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