Posted in Class Warfare, Jobs & The Economy, Labor Unions

From Angry Whopper to Angry Worker

   November 30, 2012

While I’m sure Burger King hopes that customers flock to their restaurants to try one of their new, so-called ” Angry Whoppers“, customers may find themselves being served by a bunch of angry workers.

According to organizers, hundreds of low wage workers in New York City walked off their jobs Thursday at places like Burger King, McDonalds and other fast food restaurants, protesting low wages. The goal of the campaign is to raise wages to a livable level: $15.00 an hour.

So the next time you rush to your favorite fast food joint for a Whopper, Big Mac, or whatever, tell the manager you’d enjoy your food a whole lot more if you knew that her/his employees could make a decent living at their jobs.

Bon appetit.

 

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45 thoughts on “From Angry Whopper to Angry Worker”

  1. It doesn’t seem to me that a wage increase like this would be possible if a given franchise were going to remain economically viable.

    From what I could find on the internet, which I admit can be a dubious source of information, the average McDonald’s does about 2.4 million in annual sales with about a 10% profit margin. If you have, say, the equivalent of 20 full time employees making $8 per hour and then raise it to $15, you are incurring an additional annual expense of $291,200. If you factor in the addional social security and medicare tax you pay on those additional wages (7.65%), the $7/hr raise is more like $7.50 (actually a bit higher than that), making your additional annual expense $312,000. So your annual net profit of $240,000 becomes a net loss of $72,000. You aren’t going to last very long running in the red like that.

    1. Liberalism is fun to debunk Dan. The only way to keep in the black is to raise prices. These are value biased restaurants and sales would dip sharply if you increased the product price that much.

      Steve- What is a living wage for a fast food worker? How much of a price increase are you willing to pay for this living wage? If prices go up the employees dollar spends the same. Instead of beating the class warfare drum why not report on that most fast food jobs are part time, place holders, and employees find full time work with better pay.

      Let them all quit, in this Obama economy there are 100 applicants waiting for an interview behind every fast food worker.

    2. Dan,

      If you’re going to go to all of the trouble laying out the numbers maybe you could name your source? Also, when making arguments it’s usually ill-advised to suggest your unnamed source may be of dubious quality.

      Steve,

      It would be nice also if you could cite a source for your arguments.

  2. “Steve- What is a living wage for a fast food worker?”

    The question is: What is a living wage in the United States. Or don’t you understand the concept of living wage?

    1. Way to answer my question. Since these employees are still alive seems as if they are already making a living wage.

  3. Some quick math. Someone working 40 Hours/Week X $15/Hour X 52 Weeks/Year = $31,200/Year. This is all assuming that the individual doesn’t have time off and is consistently getting 40 Hours/Week.

    “In New York, the minimum wage is $7.25, far below the $11.86 an hour it takes to actually live in the city, according to the Living Wage Project.”

    I also think it’s important to understand that these fast food jobs, these Walmart jobs, are not simply place holders for workers, not anymore. “Some 28% of workers are expected to hold low-wage jobs in 2020, roughly the same percentage as in 2010, according to a study by the Economic Policy Institute.”

    What happens to the US economy when over 25% of our workers are earning below living wages for an extended period of time?

    http://www.huffingtonpost.com/2012/01/27/cities-high-cost-of-living_n_1236841.html

    http://money.cnn.com/2012/08/02/news/economy/low-pay-jobs/index.htm?iid=HP_LN

      2. And higher wages stops that trend. So why don’t you want that?

        Oh, I know. Because you’re a wanna-be greedhead who wants to keep all of the profits (of a business you will never own) for yourself. You won’t get very far with that attitude in the real world, but I bet you’re living that reality, ain’t ya?

        1. Jake. If the employee is not going to bring in more sales there is no other way to make up for the added expense but to raise prices. It’s not greed its economics. I personally do not feel an entry level fast food job is worth $15/hr. not to mention the business pays more like $20/hr if that was the rate paid.

          I do own a business. And I can tell you are the farthest from ever having that responsibility.

          We want our employees to work up in a company and provide value and income increases follow.

          Class warfare is fun and all until you meet up with reality.

          1. Steve, I have comments on a couple things you said.

            “I personally do not feel an entry level fast food job is worth $15/hr. not to mention the business pays more like $20/hr if that was the rate paid”

            Either you don’t actually own a business or you’re confused with how it works. So you’re claiming that the employer pays an additional 33.3% in payroll taxes? The number is actually a lot closer to 15%. That’s the same thing as you claiming fast food workers already make $15/hr instead of the $7.25. It’s only off by a factor of two, that’s close enought isn’t it? Hell, I usually find it easier to just make up facts for my arguments too.

            And your response to Mike saying that raising fast food workers’ salaries would bolster the economy was, “It doesn’t work that way. They provide no extra value being paid more and since prices increase their buying power remains the same. ”

            I think your reasoning skills may have dropped the ball on that statement. First, you’re assuming that worker output is completely independent of the wages they are paid. Second, you’re assuming that in order for their buying power to remain the same, both the employees’ wages and Burger King’s prices have to increase at the same rate. Third, and probably the most misguided assumtion, is that you’re assuming the Burger King employees spend their entire paychecks on fast food. $290 a week (minus their payroll taxes which are… um, let’s just pick a number here… 33% of their paycheck) on whoppers and big macs. Or maybe even french fries if they’re feeling kinda squirley that night.

            If they spend all their money on fast food I wonder what they pay their rent with? Or their gas and transportation? How about their kid’s clothes and shoes, and maybe some heat for the wintertime? Idk, maybe poor people don’t need heat. It’s not that, maybe they don’t deserve heat. Maybe heat should be reserved for those a little bit further up on society’s food chain, because you and I both know there’s no reason somebody would be poor unless they wanted to be poor, and it’s all because of all those god damn handouts from the god damn federal government. I just wish those freeloaders would stop wanting to eat so we didn’t have to buy so many food stamps, because 2 percent of the federal budget is too much to spend to ensure that we feed our citizens better than North Korea.

  4. So McDonald’s and BK might have to raise their prices. So what? Millions of fast food workers would be lifted out of poverty, and the extra cash in their paychecks would go straight into the local economy.

    1. It doesn’t work that way. They provide no extra value being paid more and since prices increase their buying power remains the same.

      2. Obviously you’ve never owned a business or studied economics, Bagger Steve. If you did, you’d know that DEMAND is the driver of our economy, and that higher wages allows for more purchasing power, which makes it more likely that businesses should thrive and start up, which drives up competition and keeps prices affordable.

        Amazing how GOPs talk a big game about owning businesses or how and economy grows, but when you drill down, they’re usually crappy owners (hence their need for tax breaks) and/or have no clue how things work outside of Austrian textbooks.

        1. I do own a business Jake. I started it from scratch in 2008 and it has doubled every year.

          If I were to own a fast food restaurant I would get the same production and value out of an employee that makes $8 than a new employee making $15. It’s just the nature of that business. If the employee seeks further income they can move up or find better employment. To have the same profit margin I would have to raise prices.

          The blue fisters think we just sit on piles of money and laugh at the employee. In this Obama economy the owner is the last to get paid and I have never had a previous job from a poor person.

            1. Costco is a fast food restaurant? Also looks like the date on your link is from 2004. In more recent news how did it work out for Hostess employees?

                    1. Steve R,

                      You still haven’t written a word about Costco’s business model. Is it possible you’re not interested in any serious discussion of these matters?

                    2. And you guys really need to start reading the articles you link to. From the article you posted:

                      ” Regardless of that, I think the condemnation of Mr. Sinegal is ridiculous. “

                2. To state the obvious the fast food industry relies on franchises. Thus franchisee restaurant is paying all employee labor Costs. Unlike Costco, an individual McDonalds does not have thousands of employees and hundreds of locations, which profit can be obtained. Consequently, they are more sensitive to the cost side of a balance sheet than companies with more locations.

                  That being said, Costco has a good model for its market niche. Like Wholefoods, it caters to upper income individuals and are typically located in upper class suburbs. If you have the money, you shop there, if you don’t you go to Walmart, which tends serves less affluent areas.

                  I don’t see the model as being portable to all businesses and especially ones with lower margins. To apply the model to more price sensitive businesses would require prices to increase, which would hurt the lower income individuals that depend on such business for goods and services or would lead to inflation which would erode the benefit of increased pay.

                    1. The topic at hand was fast food, not Costco. I will not comment on tangents that distract from my already factual posts.

                    2. I’ve read a few articles on both McDonalds and Costco and their target markets and cost structure. I’m a lawyer, so it’s my job to sound authoritative.

                    3. Don Pridemore Steve,

                      The topic at hand is living wages, not fast food, though I do appreciate your unwillingness to comment further.

                      Super Id,

                      Then the answer to my question is no?

                    4. I said I read a few articles on the topic. I consider that “actual analysis”? Do you want a bibliography?

          2. Steve, you make a lot of equivocations: “It’s not greed its economics” “I personally do not feel..” “It’s just the nature of that business” etc. I’m not really sure what it is that you bring to this conversation other than your constant proclamations about your business savvy…way? If you’d like to share something other than your ambiguous personal feelings and beliefs that would be excellent. Other than that, of course you are right, if an employer, industry, or collection of industries are able to pay their employees less, they will; they can do this in part because there are not a lot of opportunities to “move up” or “find better employment” as we are in a recession or depression (whatever one chooses to call it). The point of this debate is to discuss the effects these types of unlivable wages will have on our economy and society as a whole.

            One more quick point. When you say “The blue fisters think we just sit on piles of money…” Do you mean all business owners/employers? Are you putting yourself in the in same club as Don Thompson, or the Walton family who are said to own “more wealth than the bottom 40 percent of America?” This discussion is about a select few, controlling a large part of our economy with the power to oppress a large part of our society. So, how do we, as a society, make this better?

            http://www.politifact.com/truth-o-meter/statements/2012/jul/31/bernie-s/sanders-says-walmart-heirs-own-more-wealth-bottom-/

            1. The recession ended June 2009. What you are living is a slow painful Obama recovery.

              I do not see an issue with those that succeeded in bushiness having more money than myself. If I personally need or want more money I work harder toward that goal.

              1. yeah, well I’m going to just dismiss your comments from now on because you are a troll; I was taught not to feed the trolls.

                Troll [trohl]
                One who purposely and deliberately (that purpose usually being self-amusement) starts an argument in a manner which attacks others on a forum without in any way listening to the arguments proposed by his or her peers. He will spark of such an argument via the use of ad hominem attacks (i.e. ‘you’re nothing but a fanboy’ is a popular phrase) with no substance or relevance to back them up as well as straw man arguments, which he uses to simply avoid addressing the essence of the issue.

                http://www.urbandictionary.com/define.php?term=troll

          3. Name the company Steve-O. Typical wanna-be. I bet you’re the biggest taker of em all. After all, your type always is maiing up for your real-life deficiencies.

            The only person who makes it on their own is printing 20’s in their basement. If you’re actually a business owner (HAH!), you’d know that you need customers, and they don’t come in the door due to tax breaks. They come in the door because they’re getting paid.

            By the way, more reports out today showing corporate profits at an all-time record, with wages still stagnant, and an economist admitting the profits are done at the expense of workers getting paid.

            Fuck the greedheads and self-deluded trash who follow them.

    2. Mike, you say “So what?” to fast food raising their prices because the workers will get more cask. The SO WHAT is that many customers will stop going to those places or less often if they can’t afford it any more. No more dollar menu. The SO WHAT is Economics 101.

      Fast food jobs aren’t necessarily supposed to be the jobs that support a mortgage and a family four. For many of us, they were our first job or serve as a part time job for some. It’s a start. Not every lawn mowing or grocery bagging job is meant to fit into your idea of a “LIVING WAGE”, but those jobs at those levels serve a valuable need in the economy.

  5. Dan,

    Any idea of what kind of mix of slightly lowered profits and raised prices it would take to pay workers the $11.86 an hour living wage this Blomberg fellow cites in the comment above? Is there a franchise.com website somewhere with these numbers available?

    1. Mr. Carlson:

      I was away from a computer all weekend so I’m just seeing this now.

      There are a lot of variables in that question. For example, if you raise prices by 5%, you probably aren’t going to see a corresponding 5% increase in revenue because quantity demanded will be lower at that higher price level. Further, I don’t know how much leeway a franchisee has to raise or lower prices. I assume prices are largely controlled by the parent corporation as part of the franchise agreement.

      From a profit perspective, it gets tricky because a lot of it would have to do with an individual franchisee’s acceptable rate of return on his or her investment. Lets say it cost $1 million to start up a franchise. If you are making $200K per year in profit, you are earning 20% on your investment, which is pretty good. Definitely better than the average return you would expect in the stock or bond market. But, if you cut that margin to $50K per year, there are probably better investment opportunities out there for your million dollars.

      Obviously, everything I have said above is hypothetical in nature. I guess my point is there are a lot of things to consider beyond just rasing wages.

      1. Dan,

        No need to address me as Mr. Carlson. Steve will do.

        Your point is well taken. My point is let’s go ahead and consider some of these things.

        The average Big Mac medium meal is roughly $5.00. A 5% increase in price makes that $5.25. Do you think this would be too steep an increase for most McDonalds customers?

        1. Steve,

          I was just using Mr. Carlson so as to not get confused with the other Steve that was commenting.

          I don’t really have a good answer for you. I don’t frequent fast food places and when I do go to one it is due to convenience rather than value (i.e. had to work late and don’t feel like cooking). In other words, I don’t really think about what I am spending. I don’t know how well my attitude towards fast food places correlates with the average consumer. To me, the extra twenty five cents would make no difference.

    1. Gareth, if all we left to rely on are top-paying burger flipping jobs, we’re in a lot of trouble. Obamanomics!

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