Fast Food Workers Strike: Will it Work?

Fast food workers in many of the major cities of the United States decided to go on strike on August 29, 2013. This move was taken in solidarity with a similar strike that was set up previously. Why was this strike set up? The reasoning behind it is related to wages. As 2013 turned into 2014, the call for wage increases went up to $15 per hour. This is still the rallying cry.

Many fast food workers throughout the country make a relatively small amount of money. Common wages are barely above the national minimum wage that is currently $7.25 per hour. President Barack Obama wants to see this go up to $10.10 per hour over time. Some locales have minimum wages that are over the national minimum.

When it comes to fast food workers, low wages are not the only problem that they face. The low wages are not paid over a 40-hour work week. At $7.25 per hour, a worker could expect to gross about $290 per week. This amount would be lower with payroll and income taxes taken out.

Most of these jobs were well below this amount even before the argument over Obamacare. My case is anecdotal, but I worked for a leading fast food establishment in my college days as my first job. During the summer, when I had unlimited availability, I would still only get about 30 to 35 hours per week.

Most fast food jobs used to be held by people like me. There were a few people who worked fast food for a "career," but most people were trying to earn a bit during college. Today, more and more people are forced to work in service jobs after having lost jobs in more lucrative fields.

Also, these fast food jobs frequently come without health benefits and vacation time. Those who have to rely on these jobs for the long term have little hope of ever improving their lot in life. Some would argue that more education or just working harder will work out. I was fortunate enough to earn a degree, but the process is not cheap. I can also state that I worked harder in fast food than at any job I have ever held since. Most fast food workers work very hard, so moving up the chain does not just involve "working harder."

I am all for people making more. I would rather more of the money go to WalMart employees than the scions of Sam Walton. If this were the case, the federal deficit would actually go down because few working people would need public assistance. I refuse to use the self-checkout lane at grocery stores because they cut down on the need for people working. Perhaps that makes me a bit of a Luddite.

Regardless of whether I would like to see these people make more money, it will not really benefit most people in the long run. It will increase the cost of doing business, and while I think those at the top of the food chain usually make too much money, they will not allow their share of the pie to go down extensively. Therefore, to keep their profit margins the same, they will raise prices.

When prices are raised, they will basically leave the minimum wage workers with the same purchasing power that they had before they got their raise. In other words, they will be able to buy the same amount of stuff in spite of having the amount of their check go up. The people who set prices will just increase the prices to keep their profits at an acceptable level in most instances, so their purchasing power will not diminish.

The people who will really get hurt in this transaction will be the ones who fall between the two extremes. If minimum wage goes up to $15 per hour, the person who gets $18 per hour goes from solidly middle class in many localities to barely earning marginally more than the minimum wage. They will not see their wages or salary go up percentage that is commensurate with the increase in the minimum wage, and their purchasing power will actually go down.

The only real answer to the problem is for people to run their business more like a place like Costco. This big box retailer gets in trouble with shareholders for not squeezing workers.

They pay wages that are well above average for retail establishments. They also pay for the vast majority of healthcare costs for employees. The benefits that the business gets from this is loyal employees that actually want to work hard. Employee theft is lower than the industry average, and the company makes money. The CEO makes less than $1 million per year, by the way.

With the acceptance of greed in the corporate world, however, Costco is the exception, rather than the rule. My guess is that it starts to go downhill for workers after the current owner/CEO retires or dies.