McDonalds and most other fast food firms employ minimum wage, non-union labor; the offended unions have encouraged a nation-wide strike for a $15 hr. minimum wage—about double the present. The media, never averse to watching a fight, has featured the pathetic spectacles of $7.50 hr. workers with two kids to support. One McDonalds’ outlet in Detroit was forced to close; a real accomplishment as we all know that city has too many jobs. The strike was aimed to engage at least 50 cities and has apparently exceeded that goal.
Few have noticed this affair since the great majority of fast food outlets have seen little of it. Nevertheless, it is much more important than the attention it has received, suggests. The core of the strikers’ demands, encouraged by the unions, is the claimed right to a living wage, defined as enough to support a family. This is a perennial bait held out by the Left (and ignoring economic reality to do so) to buy votes. The salesfolk for this never mention that the increased wages require increased prices to supply the needed money, said higher prices to be paid by the consumers generally and including the workers who are expected to benefit. Nor do they notice that a generally higher wage is a significant part of the explanation for so many jobs now done offshore, specifically to escape that higher wage.
Nor are those the only difficulties; just as occurred in manufacturing, increasing wages are providing mechanized replacements for the human labor that is becoming costly. New food-production robots are now being tested and marketed. One such produces 360 burgers hourly, replacing three kitchen workers. The fast food industry seems in little danger, though competition is increasingly tough, as the current pickle Subway finds itself suffering illustrates.
The importance of all this is: It is a low-cost, dress rehearsal for the future of the general U.S. economy. When the actual show starts, the costs will not be low. Both world competition and government policy are reducing the American standard of living. Americans cannot continue as the high cost producers in a now competitive world, but Americans aren’t prepared for the economic decline they are enduring.
Most of us can see that the minimum wage workers at fast food joints are being led down the path by the unions encouraging them. Fast food works because it’s cheap. It uses low-skill and therefore, cheap workers to remain cheap. These are therefore, marginal workers. If we force marginal workers’ costs higher, we make their products unaffordable and invite their replacement by machines or a new source of marginal workers. And that is true for higher level workers too. It isn’t just the fast food folk under this gun; the entire U.S. workforce will continue feeling the same decline. Well, except of course, for the politicians.
As this becomes undeniable, American workers aren’t going to be happy with their politicians, who are goosing the process along by such policies as rapid energy cost increases. It seems likely that the larger mass of higher level workers will, as they are forced out of denial, make a rather larger fuss than the current fast food ‘strike’ by minimum wage folk… And that will make American life very interesting.