Fast-Food Companies Pay the Minimum, So We Pay Their Workers $7B a Year

[aGameOfThrones]

BOSTON (MainStreet) — In September, workers from fast food chains in more than 60 cities across the nation went on strike to push for a wage increase to $15 an hour.

Many of those opposing the move have warned that such a wage increase could cost consumers, who would wind up being hit with a price bump on their burger. But it turns out Americans are already paying a high price to cover for the flat wages of fast food workers.

At least, that is the conclusion that can be drawn from two reports showing workers in the fast food industry rely heavily on public assistance to make ends meet — at more than twice the rate of the overall workforce.

More than half (52%) of the families of frontline fast food employees are enrolled in one or more public assistance programs such as Medicaid, food stamps and Temporary Assistance for Needy Families, costing taxpayers up to $7 billion dollars a year, according to the report issued by the University of California at Berkeley's Labor Center.

Of those fast food workers enrolled in public assistance, nearly half are full-time. The states paying out the most in public assistance are California and New York, where $717 million and $708 million are spent each year, respectively.



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The report also found that despite the traditional perception of the typical fast food worker as a teenager, two-thirds of them are in fact adults over the age of 20 and only a quarter of them minors. Additionally, the report revealed that 68% of these adult workers are the breadwinners for their household, yet a staggering 87% of them get no health benefits from their employer. This might explain why the largest expenditure in public assistance spent on fast food workers by far is Medicaid and the Children's Health Insurance Program, which accounts for $3.9 billion annually.

The second report, released by the National Employment Law Project, zeroes in on the costs of public assistance as associated to specific fast food chains.

Minimum Wage Should Actually Be $14 an Hour if You Want Basic Economic Security

NELP reports that nearly half, or $3.8 billion, of the $7 billion annual price tag of public assistance for fast food workers is spent on employees at 10 of the largest fast food companies in the country, including McDonald's , Burger King , Wendy's and Yum! Brands (which owns Taco Bell, Pizza Hut and KFC).

Fast food workers from McDonald's accounted for the highest share of public assistance funds, at $1.2 billion a year. At the same time, a NELP analysis of data from the financial firm Standard & Poor's found that the 10 companies they outlined in their report made $7.4 billion in profits last year.

There are those who have pointed to weaknesses in the two reports, namely the inclusion of the Earned Income Tax Credit in the UC-Berkeley analysis as part of the $7 billion price tag, despite the fact that EITC is not technically an entitlement program.

http://www.mainstreet.com/article/moneyinvesting/news/fast-food-companies-pay-minimum-so-we-pay-their-workers-7b-year?puc=yahoo&cm_ven=YAHOO

[CaptLouAlbano]

First off, I think minimum wage should be repealed completely. Let the free market determine wages. But the bigger issue here is that people who work in low wage jobs and receive benefits have no incentive whatsoever to better their situation, because they will lose the benefits. The welfare system has created not only dependency, but a culture of laziness.

Let's say that the best you can do, because of your education, personality, job skills, is a minimum wage job. Well, it sucks to be you, but I guess you cannot have the luxury of only working 40 hours per week. If 8 bucks an hour (or whatever the minimum is now) is all that someone is willing to pay you for your labor and intellect, then you should be out there working 12-16 hour days, 7 days a week. That's what people who have pride would do. But the fucking communists that have run this country for so long dangle a golden carrot of welfare to these people and disincentivize them to work those long hours that they should be working.

[Brian4Liberty]

Moral hazard of welfare. Really it's a government subsidy to employers of low wage, low-skilled workers. It also encourages employers to lay off employees, because those social safety nets are there. Disposable employees.

[Warrior_of_Freedom]

I feel anyone who works full time should at least be able to afford to have somewhere to live and a small amount of disposable income to keep them entertained and happy. I've worked part time jobs where I would make in 2 days what a full time fast-food worker makes in a week.

[ItsTime]

If they raised the min wage to $14 an hour they would just raise the income level where you qualify for welfare.

[dannno]

First off, I think minimum wage should be repealed completely. Let the free market determine wages. But the bigger issue here is that people who work in low wage jobs and receive benefits have no incentive whatsoever to better their situation, because they will lose the benefits. The welfare system has created not only dependency, but a culture of laziness.

Let's say that the best you can do, because of your education, personality, job skills, is a minimum wage job. Well, it sucks to be you, but I guess you cannot have the luxury of only working 40 hours per week. If 8 bucks an hour (or whatever the minimum is now) is all that someone is willing to pay you for your labor and intellect, then you should be out there working 12-16 hour days, 7 days a week. That's what people who have pride would do. But the fucking communists that have run this country for so long dangle a golden carrot of welfare to these people and disincentivize them to work those long hours that they should be working.

Ya see I think it should be the other direction - if we lowered taxes and regulations, ended our overseas empire, etc, we would be so productive that most people would only have to work 20-30 hours a week and could maintain a very good standard of living.

Some people may have to work 30-40 hours a week to maintain a decent standard of living if they are in the low level service sector or something.

[Brian4Liberty]

In the end, it's all supply and demand.

[Brian4Liberty]

Ya see I think it should be the other direction - if we lowered taxes and regulations, ended our overseas empire, etc, we would be so productive that most people would only have to work 20-30 hours a week and could maintain a very good standard of living.

Some people may have to work 30-40 hours a week to maintain a decent standard of living if they are in the low level service sector or something.

True story from a couple of weeks ago: At a very well known, large company, employees were working 12x6 for a while on a special project, on salary, no extra pay. They were told, even while working 12x6 weeks, that they weren't working hard enough, and if they didn't worker harder, they would be let go.

Supply and demand. If these people could get another job, they would leave.

[asurfaholic]

What are people thinking when they make babies and try to run a house when they are making minimum wage in a low skill job?

I sure worked those jobs when I was in high school, but quickly learned that I'd have to so something different if I wanted to survive with a family.

Seems that some people make stupid choices in life, make babies, then run back to sugar daddy Feds and say see look, I need more money to pay for this family!

The reality is that people are making babies long before they can properly care for it with a reasonable income. . And worst yet, that is encouraged - the more babies, the more "help" you get.

[Ender]

Ya see I think it should be the other direction - if we lowered taxes and regulations, ended our overseas empire, etc, we would be so productive that most people would only have to work 20-30 hours a week and could maintain a very good standard of living.

Some people may have to work 30-40 hours a week to maintain a decent standard of living if they are in the low level service sector or something.

I agree.

Get rid of minimum wage, get the gov out of business, let real capitalism flourish and EVERYONE will be better off.

[mad cow]

If they raised the minimum wage to $15/hour,most of those fast food restaurants would go under and the former employees could go on full-bore welfare costing taxpayers $????? billion a year.

[WM_in_MO]

Yes lets justify theft in a new exciting way.

I had this discussion yesterday, and the opposition literally told me to stop just saying it was theft.
They didn't have a way to justify the theft, so I had to stop reminding them.

[Keith and stuff]

First off, I think minimum wage should be repealed completely.
Absolutely. That's the smart government, small government, common sense government and no government solution.
http://www.ronpaulforums.com/showthread.php?404585-Economics-One-Lesson-by-Henry-Hazlitt-Chapter-19-Minimum-Wage-Laws

[2young2vote]

In my city a single person making minimum wage and working 30 _ 40 hours per week can have a very decent standard of living if they are frugal with their lifestyle. You ,an get houses in very middle class neighborhoods for less that 200 per month. A used carthat you only use for driving around town and a sensible phone plan and you could actually be saving money in the bank. Although, that may not be true now with people being forced to buy overpriced health insurance. I believe that, unless you live in a large city with inflated housing prices caused by government laws, a person could make it on minimum wage without government assistance. Of course, when you start throwing peoples bad life decisions into the mix., like smoking and sex as a recreational activity, then you begin to have some problems.

[tod evans]

Everything "government" gets involved in it fucks up.

Welfare/healthcare/minimum wage/ unemployment, on and on and on....

A man doesn't "deserve" anything but a fair shake....

[CaptLouAlbano]

Ya see I think it should be the other direction - if we lowered taxes and regulations, ended our overseas empire, etc, we would be so productive that most people would only have to work 20-30 hours a week and could maintain a very good standard of living.

Some people may have to work 30-40 hours a week to maintain a decent standard of living if they are in the low level service sector or something.

It's been a while since I have been on, but I wanted to reply to this. Even long before we spent our country into oblivion, people worked long hours. Go back to the 18th and 19th century, and see how many hours per week those folks worked. So even if we did all that you suggest (which I do agree with), there will be many folks who would work 50-70 hours per week. While the lowering of taxes, reduction of regulations, etc would have a major effect on the economy - the simple fact that the ambitious would still work long hours every week would raise prices enough so that only working 20 hours per week would not be enough to survive and thrive. Heck if the value of the dollar increased, I would be tempted to work even more.

[PierzStyx]

In my city a single person making minimum wage and working 30 _ 40 hours per week can have a very decent standard of living if they are frugal with their lifestyle. You ,an get houses in very middle class neighborhoods for less that 200 per month. A used carthat you only use for driving around town and a sensible phone plan and you could actually be saving money in the bank. Although, that may not be true now with people being forced to buy overpriced health insurance. I believe that, unless you live in a large city with inflated housing prices caused by government laws, a person could make it on minimum wage without government assistance. Of course, when you start throwing peoples bad life decisions into the mix., like smoking and sex as a recreational activity, then you begin to have some problems.

DING DING DING

Frugality is the key. If you're willing to live within your means you're able to live a comfortable life with all your necessities well taken care of and your essential needs met. Problem is no one today knows how to be frugal. They want it all-NOW. And their willing to cripple their children to do it.

[AnarchoCapitalist]

If only we had sound money ...