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Where Does McDonald's Pay $15 an Hour and More News

Where Does McDonald's Pay $15 an Hour and More News



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In today's Media Mix, a giant panda enjoys a birthday cake, plus Amy's Baking Company is making T-shirts

Where does McDonald's pay their workers living wage? Not here.

The Daily Meal brings you the biggest news in the food world.

Today's Squee: Panda and Cake: An adorable panda got a giant cake for its fourth birthday, made from apples and yams, fruit slices, honey, and bamboo stalks. [MSN]

Amy's Baking Company Shirts: The owners of Amy's Baking Company, who were so crazy they made Gordon Ramsay walk out, are now capitalizing on their infamy by selling shirts with catchphrases, like, "I speak feline. Meow!" Ugh. [Eater]

McDonald's Abroad: Some countries have higher minimum wages than the United States (i.e. Australia with roughly $14.50 an hour), and McDonald's still turns a profit. The Atlantic looks at how it's done. [Atlantic]

In-N-Out Taking Over Austin: The chain has confirmed a third Austin location. [Culture Map]


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McDonald’s increases wages at US company-owned restaurants

McDonald’s to raise hourly wages of employees working at company-owned restaurants in the US.

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McDonald’s has decided to increase the hourly wages of more than 36,500 employees working at company-owned restaurants in the US.

The hourly wage will be increased by an average of 10%.

The American fast-food company said that it has already initiated a wage increase process that will be rolled out over the next several months.

Through this initiative, entry-level crew will receive wages ranging between $11 – $17 an hour, while the shift manager hourly wage will range between $15 – $20 an hour, based on restaurant location.

The company expects that the average hourly wage of employees working at McDonald’s-owned restaurants will be $15 per hour by 2024.

McDonald’s US president Joe Erlinger said: “Our first value is taking care of our people, and today we are rewarding our hardworking employees in McDonald-owned restaurants for serving our communities.

“These actions further our commitment to offering one of the leading pay and benefits packages in the industry.”

McDonald’s added that it is re-opening its dining sections wherever it is safe to do so and plans to recruit 10,000 new employees over the next three months, in anticipation of a busy summer season.

In addition to the wage increase, McDonald’s has announced a competitive benefits package for eligible employees working at company-owned restaurants.

However, the wage increase will not be available to staff members working at McDonald’s restaurants owned and operated by franchisees.

Currently, McDonald’s franchises 95% of its restaurants in the US.

Last month, McDonald’s implemented new Global Brand Standards across its 39,000 company-owned and franchise restaurants as a commitment to providing safe and inclusive workplaces.

The new initiatives are aimed at ensuring the physical and psychological safety of employees and customers by preventing violence, harassment and discrimination.


McDonald’s to raise wages by average of 10% across US

(NEXSTAR) — McDonald’s announced Thursday that it is raising hourly wages by an average of 10% for more than 36,500 employees at its company-owned restaurants in the U.S.

The fast-food giant says the changes, which have already begun, will include raising the entry-level wage to a range of $11 to $17 an hour, as well as increasing the starting range for shift managers to between $15 and $20 an hour, based on restaurant location.

Today we announced that McDonald’s USA will be raising hourly wages for more than 36,500 employees at McDonald's-owned restaurants by an average of 10 percent. https://t.co/xNAYOLkSWB pic.twitter.com/YjQDQUQnCe

&mdash McDonald's Corporation (@McDonaldsCorp) May 13, 2021

“Our first value is taking care of our people, and today we are rewarding our hardworking employees in McDonald-owned restaurants for serving our communities,” Joe Erlinger, president of McDonald’s USA, said in a press release. “These actions further our commitment to offering one of the leading pay and benefits packages in the industry.”

The company says it is seeking to hire 10,000 new employees over the next three months as the summer season approaches and dining rooms reopen amid the pandemic.

The wage increases will be rolled out over the next several months.

McDonald’s says it expects some of its restaurants have, or will, reach an average hourly wage of $15 an hour this year, while overall average hourly wages are expected to reach $15 an hour by 2024.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


What minimum-wage increases did to McDonald’s restaurants — and their employees

New research by a Princeton economist examined wage increases at McDonald's.

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President Joe Biden and Democratic lawmakers are making a push to raise the federal minimum wage to $15 an hour from the current $7.25. Some lawmakers and business owners who are against the idea say it would create harmful effects, including business closures, job loss and an acceleration of the shift toward automation.

But those effects didn’t materialize in a five-year analysis of the impacts of minimum-wage increases at state and local levels as evidenced at more than 10,000 McDonald’s MCD, -0.40% locations in the U.S.

In fact, as a result of the nearly 300 minimum-wage increases that took place between 2016 and 2020, many McDonald’s restaurants paid workers slightly above the new minimum wage to retain employees. That’s according to new research by Orley Ashenfelter, a Princeton University economist, and Štěpán Jurajda, an economist at Charles University in Prague.

The two economists collected survey data on the price of a Big Mac (including sales tax) and wage rates of basic hourly workers above the age of 18 from at least 90% of U.S. counties with a McDonald’s in every year.

They found that the higher cost of labor that results from increasing minimum wages gets passed on to consumers in the form of more expensive Big Macs.

More specifically, they estimated that a 10% minimum-wage increase leads to a 1.4% increase in the price of a Big Mac. On average, Big Macs cost $5.66 in the U.S., according to the Economist’s Big Mac Index.

Previous research has suggested that businesses are more likely to turn to automation to replace low-skilled workers in response to minimum wage increases.

While more than 75% of McDonald’s restaurants used touch-screen ordering kiosks in 2019, up from just 20% in 2017, Ashenfelter and Jurajda weren’t able to conclude whether this was directly related to minimum wage hikes.

Chris Kempczinski, McDonald’s president and CEO, acknowledged the push lawmakers are making to raise the federal minimum wage to $15 an hour on the company’s Thursday earnings call with investors.

“Our view is the minimum wage is most likely going to be increasing, whether that’s federally or at the state level,” he said. As long as it’s done “in a staged way, and in a way that is equitable for everybody, McDonald’s will do just fine through that,” he added.

Separately, a McDonald’s USA spokesperson said they are “aware of the study and are reviewing it in detail.”

“It’s important to note that McDonald’s menu pricing is set by individual restaurant owner/operators and influenced by a number of market conditions, including employee wages, commodity costs and taxes,” the spokesperson said. “We remain committed to offering customers high-quality, affordable options across our menu.”

Because consumers did not significantly cut back on Big Macs as a result of price increases, company-owned locations did not need to shut down or even lay off employees, the study found. However, the price increases that occurred also meant that the wage gain workers received was effectively less impactful, because they as consumers would have to pay more for goods such as Big Macs.

What does this mean for the fast-food industry?

The leisure and hospitality industry, which includes restaurant workers, employs the greatest share of workers (11%) who earn hourly wages at or below the federal minimum across all industries, according to research published by the Bureau of Labor Statistics in 2019.

A separate 2013 study by University of California, Berkeley, economists found the fast-food industry has the largest share of workers who rely on public benefits, with 45% using government assistance.

A McDonald’s USA representative had previously told MarketWatch that “the average starting wage at U.S. corporate-owned restaurants is over $10 per hour and exceeds the federal minimum wage.”

The National Restaurant Association, a trade group, spoke out against a push in Congress to pass the Raise the Wage Act of 2021, which was unveiled on Tuesday. Similar to the Raise the Wage Act of 2019, which passed in the House, the legislation calls for the federal minimum wage to increase to $15 an hour by 2025.

“Our industry runs on a 3-5% pretax profit margin in a good year — during a pandemic is not the time to impose a triple-digit increase in labor costs,” Sean Kennedy, executive vice president of public affairs at the NRA said in a statement. “Far too many restaurants will respond by laying off even more workers or closing their doors for good.”

Ashenfelter and Jurajda’s findings indicate the opposite. However, Ashenfelter acknowledged that these findings may not be translatable to other fast-food chains or industries because “other firms might behave differently.”

In other words, instead of raising prices of goods as McDonald’s did, some businesses may instead layoff workers.

Indeed, the Congressional Budget Office, a nonpartisan federal agency, estimated that raising the wage to $15 an hour by 2025 would result in a median of 1.3 million job losses, though the same number of people would no longer be living below the federal poverty line if a $15-an-hour minimum wage were enacted. Overall, CBO found, wages would rise for some 17 million workers.


Workers at McDonald’s-owned restaurants getting pay hike

McDonald’s announced Thursday it is raising hourly wages for more than 36,000 employees at company-owned restaurants by an average of 10%.

The global fast-food giant said the increases, which have already begun, will be rolled out over the next several months and include shifting the entry-level range for crew to at least $11 to $17 an hour, and the starting range for shift managers to at least $15 to $20 an hour, based on restaurant location.

Entering into the summer with dining rooms reopening where safe, McDonald’s-owned restaurants are also looking to hire 10,000 new employees during the next three months.

McDonald’s expects the average hourly wage for its company-owned restaurants to increase to $15 an hour in a phased, market-by-market approach. Some restaurants have, or will, reach an average hourly wage of $15 an hour in 2021, and average hourly wages are expected to reach $15 an hour by 2024.

McDonald’s is the latest big-chain employer to raise wages. In February, Costco, the members-only wholesale warehouse chain, announced it is increasing its starting pay wage to $16 an hour. The starting wage scale puts Costco above competitors including Amazon, Target and Best Buy, which have $15 minimum wages.

Less than a month later, Walmart said its hourly workers will collect bigger paychecks on the East and West coasts.


McDonald's workers in Denmark are paid $22 per hour so $15 is a 'compromise', AOC says

Rep. Alexandria Ocasio-Cortez tweeted Tuesday about the fight for a $15 federal minimum wage.

Ocasio-Cortez cited McDonald's workers in Denmark are paid $22 per hour along with other benefits.

"$15/hr is a deep compromise - a big one, considering the phase-in," she wrote.

Some major retailers have already stopped fighting against a $15 minimum wage. McDonald's and Waffle House CEOs both told Insider that the chains could handle a $15 minimum wage, and McDonald's stopped lobbying against it in 2019. Walmart said it would start paying workers on the east and west coasts at least $15 an hour, Costco recently raised its minimum to $16 per hour.

Executives have also told Insider that they would consider raising menu prices if a higher minimum wage went into effect. Potbelly's, Texas Roadhouse, and The Cheesecake Factory have each addressed potential to raise prices along with wages, Kate Taylor reported for Insider.

"I would say there is a short-term shock," Texas Roadhouse CEO Wayne Taylor told investors in October. "And then long term, there's an adjustment, both on our side and the guest side."


McDonald's workers in Denmark are paid $22 per hour so $15 is a ɼompromise', AOC says

Rep. Alexandria Ocasio-Cortez tweeted Tuesday about the fight for a $15 federal minimum wage.

Ocasio-Cortez cited McDonald's workers in Denmark are paid $22 per hour along with other benefits.

"$15/hr is a deep compromise — a big one, considering the phase-in," she wrote.

A provision that would have raised the minimum wage to $15 was struck from President Joe Biden's $1.9 trillion stimulus package was removed in late February after a ruling from the Senate parliamentarian. Another plan to add a tax penalty for companies that failed to pay a $15 hourly wage was also dropped from the bill.

Some major retailers have already stopped fighting against a $15 minimum wage. McDonald's and Waffle House CEOs both told Insider that the chains could handle a $15 minimum wage, and McDonald's stopped lobbying against it in 2019. Walmart said it would start paying workers on the east and west coasts at least $15 an hour, Costco recently raised its minimum to $16 per hour.

Executives have also told Insider that they would consider raising menu prices if a higher minimum wage went into effect. Potbelly's, Texas Roadhouse, and The Cheesecake Factory have each addressed potential to raise prices along with wages, Kate Taylor reported for Insider.

"I would say there is a short-term shock," Texas Roadhouse CEO Wayne Taylor told investors in October. "And then long term, there's an adjustment, both on our side and the guest side."

Price increases are one of the chief criticisms brought up against increasing minimum wages for fast-food workers. As of January 2021, in the US a Big Mac costs $5.66, compared to about $4.90 in Denmark, according to Statista and The Economist's Big Mac Index.

McDonald's workers in Denmark make about $22 per hour, along with sick leave and paid time off thanks to the efforts of unions, though some economists say that a direct comparison of wages may be unfair due to the much higher cost of living in Denmark.


McDonald’s Response to $15 Minimum Wage: Automation in Every Store

It’s official: McDonald’s says that every one of its 14,000 stores nationwide will be replacing cashiers with automated touch-screen kiosks. They’re starting with stores where minimum-wage laws mandate the highest rates, such as Florida, New York, San Francisco, Boston, Chicago, Washington, D.C., and Seattle.

So the fast food giant is rolling out self-order kiosks, mobile pay options, an updated interior design, even table service. The changes are already starting to show up at locations in Florida, New York and Southern California, where 500 restaurants have been updated. Restaurants in San Francisco, Boston, Chicago, D.C. and Seattle will get upgrades in early 2017. Now, McDonald’s loyalists will be able to place their customized order on a touch screen, take a seat and have their meal brought right over. Next year, they’ll even have the option of mobile ordering.

That means that, eventually, more than 20 million customers every day will place their own orders at a kiosk or on a mobile device and then have them delivered by a human to their table. And it’s just a matter of time before those humans will be replaced by machines as well.

Ed Rensi started as a grill man for McDonald’s in Columbus, Ohio, in 1966. He was promoted to manager within a year and continued to be promoted, all the way up to president and chief operating officer in 1984. In 1991, he was named chief executive officer and retired to a life of speaking professionally about his experiences in 2007.

In May, Rensi was asked about the discussion over raising the minimum wage. He responded: “I guarantee you if a $15 minimum wage goes across the country you’re going to see a job loss like you can’t believe. It’s cheaper to buy a $35,000 robot than it is to hire an employee who’s inefficient making $15 an hour bagging French fries.”

It’s all about the math. Rensi oversaw every aspect of McDonald’s: sales, profits, operations, customer satisfaction, product development, personnel, and training. If a store can replace a $15 an hour employee with a robot that costs $35,000, it will not only improve that store’s operating margins but will actually enhance customer experience: robots don’t get sick, they don’t have attitudes or get pregnant, they don’t go on strike, they always show up for work on time, and, as software improves, will provide a friendly, interactive interface with the store.

McDonald’s decision will also answer, finally and forever, the question that economics textbooks and economics professors have been raising and then trying to answer for decades: What impact will raising the minimum wage have? Supporters of minimum-wage laws say that they increase the standard of living of workers, reduce poverty, reduce inequality, and boost the economy as well as the morale of workers.

Opponents say minimum-wage laws increase unemployment and poverty and are especially damaging to small businesses that are forced to raise their prices to cover the increased labor costs.

Here’s the math: a worker being paid $15 an hour costs his employer $38,500 a year, including unemployment insurance and the employer’s part of Social Security. If Rensi is right, and the average robot in a McDonald’s costs $35,000, in less than a year that store has paid for it in reduced wages, and eliminates that $15 an hour cost forever after. If there are 30 employees in a McDonald’s, and if just 10 of them are replaced by a robot, customers will enjoy another benefit: lower prices on their Happy Meals.


The McDonald’s Vacation Plan Is A Bigger Deal Than The Pay Raise

Forget the paltry McDonald&rsquos raise. The real news is that the fast food giant is going to start offering its workers paid vacation time.

According to The Wall Street Journal, McDonald&rsquos will raise pay and offer paid vacation for about 90,000 workers at its 1,500 company-owned U.S. stores. (The announcement doesn&rsquot affect the far larger number of workers at the 14,350 U.S. McDonald&rsquos stores owned by franchisees.) Starting July 1, the chain will pay at least $1 an hour more than the local minimum wage.

The announcement, which comes on the heels of similar moves by Wal-Mart, Target and other big employers, is the latest piece of evidence that the improving economy is at last trickling down to low-wage workers. But let&rsquos not get carried away. McDonald&rsquos says the new policy would boost average pay by about 10 percent, to $9.90 an hour. That&rsquos shy of both the $15 an hour that union-backed protesters have been demanding and of the $10.10 an hour that President Obama has called for.

The new vacation policy, however, might be a bigger deal. McDonald&rsquos said its workers will start being able to accrue up to five days of paid time off once they&rsquove been with the company for a year.

Five days of vacation may not sound like much, but it&rsquos a better deal than many similar companies offer. According to the Bureau of Labor Statistics, only 39 percent of workers in the bottom 10 percent of earners get any paid time off at all. Among all part-time workers, the rate is an even lower 34 percent. (In the accommodation and food service sector, 45 percent of workers get paid vacation, but that figure includes everyone from fry cooks up to CEOs. The share among low-wage workers in the sector is almost certainly much lower.) Overall, 77 percent of private-sector U.S. workers get access to paid vacation.

The McDonald&rsquos announcement comes as Obama has been pushing for employers to offer paid leave (although that effort has focused primarily on family leave and sick time, not vacation) and as the Service Employees International Union has spent millions supporting the &ldquoFight for $15&rdquo unionization movement among fast-food workers. There&rsquos no way to know whether that kind of public pressure contributed to McDonald&rsquos decision or whether other companies will follow suit.


Watch the video: TRUE McDonalds Horror Story Animated (August 2022).