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5 Reasons the Fast-Food Worker Protests Are Off Base

5 Reasons the Fast-Food Worker Protests Are Off Base
Image credit: MSN

Since when did flipping burgers become a career?

Nationwide, fast-food workers are walking out on their franchise owners, staging a "strike" to try to get what they claim is a living wage of $15 an hour, or about twice the federal minimum wage.

Most media are shocked – shocked! – that people are forced to raise families on such low wages, and we are hearing stories about how big fast-food companies like McDonald's, Burger King, Pizza Hut and KFC are denying people basic rights because of such low pay. As one New York politician put it this morning, echoing Martin Luther King Jr., "It is a crime for people to live in this rich nation and receive starvation wages."

Actually, it isn't. It is never a crime to give someone a job, nor are what these employees are getting "starvation" wages. In fact, the entire protest is off base. Here's why:

1. These are not careers.

Working at a fast-food joint was never meant to be a career, at least not one designed to raise a family. Anyone who owns a franchise knows that turnover is high because most workers are young and making an extra buck. It is tragic that some people are forced to take these jobs to try to make ends meet, but they are the exception, not the rule. Most workers have such low average pay because they are young and don't stay long. This is a stepping-stone job, one to bide the time until you find an actual career. Structurally, it was never meant to be full-time work for the guy dumping fries in the hot oil. It was a career for the owners and managers, not the cooks and cashiers.

2. These are the ultimate unskilled jobs.

It takes zero skill to make a hamburger in a fast-food restaurant. Zero. The product is provided for you. There is an assembly-line system to help ease the burden of placing the burger in the bun. Packaging is stacked neatly. Minimum wage is designed for unskilled, part-time jobs like this. If you want $15 an hour, to put the average pay for these workers up to $30,000 a year, you are getting close to a starting salary for someone who went to college and is embarking on an actual career. Economically, pay should be based on the job duties, not the individual situation of the worker. In fact, these jobs are so unskilled that many of their functions can and will be replaced not be lower-paid workers, but by automation.

3. This is a protest of small businesses, not corporations.

The media and protesters may be positioning this as a fight between the struggling worker and evil Big Business, but most of the restaurants at issue are owned by franchisees. These are small-business owners, with small budgets and fixed costs set by the companies. Many small-business owners know the value of their employees, but they lack the financial flexibility to pay more. If they set higher-than-average pay for their workers, that cuts into profits, since most franchises don’t give individual owners price flexibility in the products they sell. You have to peddle the dollar menu whether you pay $7.50 an hour, $15 an hour or $100 an hour. Wiping out profits closes businesses, and that puts people out of work altogether.

Related: Do Angry McDonald's Franchisees Have a Leg to Stand On?

4. This is about unionization, not the individual worker.

It is no surprise that unions are big backers of the protests around the country. They have been trying to organize franchises for years. While the size of the wage is the issue, unionization of these workers creates new problems for the franchise owners. There will be requirements about benefits, fixed raises and bargaining rules. All of those change the financial model for the franchisees. That is more money in the pockets of the unions, through dues, but that comes at the expense of the business owner.

5. Higher wages could lead to structural employment problems.

Higher wages and benefits promote job stability. That’s great if you are running a business where the quality of your worker matters, because of their education and skillset. But it provides no value when the worker is unskilled. For one thing, it creates a pattern where a career employee receives year after year of wage increases, creating budget pressures that otherwise could be relieved through turnover. Secondly, it keeps entry-level people from entering the workforce at the level they should: the bottom rung. Youth unemployment is already at 16 percent, and the labor force participation rate among youth continues to decline. It is bad enough that overall unemployment remains stubbornly high. Taking way a popular entry point for new workers will only make it worse.

No one wants families to suffer, or go hungry or not receive fair pay for the quality of their skill. But that’s not what these protests are about. Protesters of fast-food chains are just playing fast and loose with the facts.

Related: What the Crowdfunding Boom Means for Franchising

 

Ray Hennessey is Editorial Director of Entrepreneur.com.

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