Rochester is among the 100 cities across the nation seeing fast-food worker strikes and marches. These low-paid workers are advocating to double the minimum wage to $15 per hour. Organizers say employees planned to forgo work in 100 cities, with rallies set for another 100 cities.
This issue is another political hot potato. President Obama reportedly supports the movement to increase the minimum wage. With the public disapproval of ObamaCare, this is likely to further lower his approval ratings, especially with the millennial generation and senior citizens. Fast food industries thrive because of low wages for its labor.
Doubling payroll expenses and payroll related taxes and insurances would turn this industry upside down. These costs will certainly be passed on to the consumers. Although an oversimplified example, presume labor costs are 50% of a fast food restaurant’s operating budget. If these costs doubled overnight, it is likely we’d see a 25% increase in prices. A $3.99 burger will now be $4.99. The value menu (or dollar menu) will become the $1.50 or $2.00 menu. Will you eat fast food as often? If fast food places go out of business and result in job loss is this really helping the economy? This is a complex issue on both sides.
How do you feel?