$20 minimum wage for Fast-Food workers in California [LOCKED DUE TO POLITICS / COVID]

[RockCrusher]

On a related note, article in April 8, 2024 WSJ:

Fast Food Flashes Worrying Signal

The take away -- no pun... -- is fast food buying patterns are changing and signaling all is not well in quick-serve restaurants (QSR). Core customers and lower income customers are changing their dining habits. Not ordering french fries is one way.

The article states that the consumer-price index for food away from home has risen by nearly 30% in the past 5 years. In the comparable period immediately before the pandemic it gained 14%.

And in CA the $20-an-hour minimum wage will begin to exert its influence.

[unluky]

$1.65!!! Wow! I go back to my first REAL job (father was a farmer, so I ALWAYS worked) I made $3.35 per hour AND got the "privilege" of paying union dues out of it! Even at 15 I remember the optics of a group of men in suits with Caddies parked at the fire lane curb walking in every 3 months or so to shake everyone's hand, call us "brothers", and thank us for keeping the union strong. LOL

I can also remember my first paycheck that was over $100 - I was amazed!

If we only knew then..............

[Car-Addicted]

Originally Posted by RockCrusher

And in CA the $20-an-hour minimum wage will begin to exert its influence.

Robert Irvine shares your concern

Celebrity chef Robert Irvine predicts California 'opened the gateways' to minimum wage 'problem' in America
One of the world’s toughest and most resilient chefs – who’s helped hundreds of restaurants on the brink of survival write their comeback stories – claims nothing could have prevented the consequences of California’s $20 minimum wage, but there is one solution.
"This is Robert Irvine predicting we're going to lose about 20-plus percent of our small, mom-and-pop business because what California has actually done is going to enable other states to do the same thing," the celebrity chef and host of "Restaurant: Impossible" told Fox News Digital.
"And the increase of wage plus the food cost is putting small, mom-and-pop operators out of business because they cannot afford $20 an hour, $27 an hour in some places," he added. "Fast food chains, think of the McDonald's and the Yum! Brands and all those kind of folks, are turning to technology to offset that human being."
https://www.foxbusiness.com/media/ce...roblem-america

I spent 40 years plus as a manufacturers representative with most of my customers being considered small business shops. These folks are generally in the business due to passion and not to get rich. Due to my business experience I was often consulted to try to help struggling business's and if memory serves was around cost of labor was around 28% of gross sales. The issue is not just the wages but the ancillary costs of workmans comp, local and state income tax, Social security tax, 401(k) contributions. Bottom line is these small business's are be placed in a untenable position of dealing with:
1) Higher labor cost and associated cost
2) Higher consumables cost due to inflation
3) Lower sales due to effect of inflation on consumers
4) Demographic shifts that effect their local market.

Not a pretty picture, Robert Irvine sees the future.

PS. My first non family/farm job was working in a bicycle shop for $.25 a hour. I was 13 and there were no child labor laws at the time.

[unluky]

Originally Posted by Weather Man

I remember as a kid going down to the school with my hoe to walk beans. Farmers would pull up and tell X number of kids to hop in the back of the pickup. Go out to the farm and head for the shed. He would sharpen your hoe and then head out to the fields. Some weeds you could chop and some had to be pulled and stood up against the bean row root side up. Some of those mustard patches, ugh! Sometimes the farmer would go to 75 cents an hour for the really bad fields.

LOL - yeah - that is what I grew up doing - for FREE! LOL If I never pull another stalk of shattercane again in my life I'll die happy.

[AmuroRay]

It's clear that California is trying to put small business out of business.

[AmuroRay]

Originally Posted by Weather Man

They're succeeding, death by a thousand cuts.

Covid Shutdowns were one of those deep cuts. I think the shutdowns were about destroying small businesses and making people more reliant on megacorporation's (who function as arms of the government)

Example - the government can't just scan your phone, that's a violation of your 4th amendment.

What they can, and do is allow Google, or Apple to scan your device, and if anything illegal is found, they will notify the authorities. These systems are put in place so the government has plausible deniability on these matters. It happens with Speech on platforms as well.

[infinitekidM2C]

Originally Posted by AmuroRay

It's clear that California is trying to put small business out of business.

This aint shit. check out all of the Labor Code sections and case decisions that make it a fecking minefield.

[Donatello.]

Originally Posted by 2000cs

And of course this is a static analysis. The dynamic is once a “living wage” is achieved, all wages rise and prices inflate. So housing once again becomes unaffordable for those at the bottom. The dynamic effects are not uniform; some do better and some worse. But raising the minimum wage does not improve affordability after the economy adjusts.

The COL was already insane before this min wage raise.

Wages, all round, have not kept up. That is one of the major problems.

Greed. It is all greed. The rich that run the show are just greedy.

[Donatello.]

Originally Posted by AmuroRay

Covid Shutdowns were one of those deep cuts. I think the shutdowns were about destroying small businesses and making people more reliant on megacorporation's (who function as arms of the government)

Yea, could not be about not having more people die of COVID or anything...

[LuisBoston]

Originally Posted by Honda

Raising minimum wage will raise prices for sure then raise standard of living. Then 20 minimum won't be enough anymore and the loop will continue...

Now do it the opposite direction.

But keep housing supply constant because that’s what we do now.

[HeartbreakerF80]

Originally Posted by peelerec

Right, I understand the overall cost of life is more expensive, but what is the true reason... is it truly that companies are struggling to make livable margins, or have they gone the other way and make exorbitant margins......
I know every industry is different which is why I am ignorant relating to food industry and of the like.

Corporate profits in almost every industry are at all time highs and officer pay (CEO, CFO, etc) has reached its largest multiplier of low level employee compensation ever.
Companies have been using COVID, inflation, and now “higher wages” to absolutely rape the consumer AND low skilled laborer while taking in more profit and higher margin than ever before.

[2000cs]

Originally Posted by HeartbreakerF80

Corporate profits in almost every industry are at all time highs and officer pay (CEO, CFO, etc) has reached its largest multiplier of low level employee compensation ever.
Companies have been using COVID, inflation, and now “higher wages” to absolutely rape the consumer AND low skilled laborer while taking in more profit and higher margin than ever before.

Or they are competing for capital, which requires higher returns for shareholders (who want returns that “beat” inflation and compensate for risk). Look at not-for-profit companies (not NGOs), like the telecom, electric and insurance cooperatives. They are motivated to provide excellent service and low cost - there is no profit motive. But they still have had to raise prices.

The issue with CEO pay vs the lowest or average pay is an indicator of increasing efficiency and scale. Using the McDonalds examples in this thread, if the CEO or company could only effectively manage 1,000 locations in one country instead of 40,000+ globally, he would be paid a lot less and the pay multiple would be much lower. That said, I think there is an issue with boards that are a little too close to the CEO and the way CEO compensation is “benchmarked” in the boardroom (by reputable firms, not management or the board itself), resulting in higher pay than necessary. As with the McDonnalds example, however, this has almost no direct impact on their prices or their profitability (so it is an easy board decision).

[AmuroRay]

Originally Posted by Donatello.

Yea, could not be about not having more people die of COVID or anything...

So they can just violate your rights on their whims? 99.8% survival rate.

[AmuroRay]

Originally Posted by 2000cs

Or they are competing for capital, which requires higher returns for shareholders (who want returns that “beat” inflation and compensate for risk). Look at not-for-profit companies (not NGOs), like the telecom, electric and insurance cooperatives. They are motivated to provide excellent service and low cost - there is no profit motive. But they still have had to raise prices.

The issue with CEO pay vs the lowest or average pay is an indicator of increasing efficiency and scale. Using the McDonalds examples in this thread, if the CEO or company could only effectively manage 1,000 locations in one country instead of 40,000+ globally, he would be paid a lot less and the pay multiple would be much lower. That said, I think there is an issue with boards that are a little too close to the CEO and the way CEO compensation is “benchmarked” in the boardroom (by reputable firms, not management or the board itself), resulting in higher pay than necessary. As with the McDonnalds example, however, this has almost no direct impact on their prices or their profitability (so it is an easy board decision).

Yeah none of this is correct. It's a fiscal system based on deflating the value of money yearly to push us further into surfdom (combined with increased automation) where eventually we will NEED the government to provide the most basic needs.

All you did was describe the most recent official narrative, but it doesn't address what the actual issue is and what their goal is. Money isn't the motivator, it's a tool.

They system is working exactly as designed.

[c1pher]

Originally Posted by Car-Addicted

I'm going to assume you're a youngster?

History 101: Price controls don’t work
President Richard M. Nixon imposed wage and price controls on Aug. 15, 1971. Oil and gas were two of many commodities affected. An initial 90-day freeze turned into more than 1,000 days before the controls were dismantled. Inflation — just above 4 percent in 1971 — was in double digits when the controls were lifted.

Nixon kept the wage-and-price controls on oil, gasoline and petroleum products in place, as did Presidents Gerald Ford and Jimmy Carter. The results were disastrous. Oil exploration and domestic oil production slowed sharply. And foreign oil poured into the nation’s gas tanks, filling the booming demand for price-controlled gas.

Thanks to this misguided policy, gasoline lines snaked along highways for hours during oil crises in the mid- and late-1970s. Stations ran out of gasoline and laws told consumers which days they could purchase gas. A windfall-profits tax compounded all the negative effects, and the shortages lasted until President Ronald Reagan repealed controls in 1981. The price of a gallon of gas at the pump fell by a third over five years.
Drawing on experiences of the 1970s, the FTC concluded that price controls meant “gasoline shortages could result,” leaving consumers worse off.

The history lesson for this Congress could not be clearer. Price controls could create shortages and leave our economy dangerously exposed to disruptions in supply. In the 1970s, we were the only nation on Earth to have gas lines. Why would anyone ever want to go back to that?
https://www.chicagotribune.com/2007/...ols-dont-work/

Yeah but we will do it correctly next lol.

[c1pher]

Originally Posted by ezaircon4jc

Minimum wage jobs are ENTRY, NON-SKILLED positions. No one is supposed to live on minimum wage. I've said it before, if one is at minimum wage for more than 6 months, they're pretty much a loser. As long as one puts in the effort and does a good job, they will get a six-month bump. Fast food isn't supposed to be a career either; unless one moves into management. Your local FF jobs are supposed to be for teenagers working their first job (or maybe retired peeps just looking to keep busy), not someone raising a family. Margins in the food industry are pretty tight and most of the profit is alcohol & soft drinks. Food and paper costs are much higher than one might think.

We went to Chipotle a couple of days ago. It was $29 for a burrito, bowl and a drink. For that money, we could have gone to a sit-down place. I read an article about a guy that owns a few (I don't remember how many) Cinnabon's and Annie's Pretzels places in the Bay Area. He said he won't be expanding as he planned and will have to lay-off employees. He also said that this bill will cost him about $476K per year.

I wouldn’t call these people losers. Unfortunately many people cannot be engineers, coders, doctors, lawyers etc. They are working to make ends meet. They don’t have the ability to elevate in society. I don’t think raising minimum wage to exorbitant levels is really the answer either because those people at most at risk for automation and losing their jobs. Then they’re homeless. My family on my mom’s side all worked menial jobs and multiple generations were living under one roof to pool resources to get by. Grandparents getting SS, parents doing blue collar work and young working age kids working whatever side or part time jobs they could get to contribute. They even took in foster kids for money. My mom dropped out of high school after 10th grade to work in a cannery. I was fortunate not to experience that but remember the stories well.

But if fast food is as expensive as a sit down restaurant, the only reason you’d go to a fast food restaurant is because you don’t have to get out of your car. I swear, a sit down restaurant can be a faster experience than visiting a fast food restaurant.

[c1pher]

One aspect of the cost of living rising that isn’t considered is the cost of technology woven into everything. From fast food to cars, technology adds to cost quite a bit. Technology certainly adds to our quality of life overall but it’s also more costly. Consider any car today. It has many safety and convenience feature not present in a car from the 70s. I am certain that if you made an exact car from that era, other than inflation, it would actually be cheaper due to manufacturing efficiencies rather than including all those doodads in your car. I think fast food is similar. From the cash registers, self service kiosks, screens to monitor order flow, safety requirements and many more on top of the grills they’ve always had.

Sometimes simpler is better.

[Donatello.]

Originally Posted by AmuroRay

So they can just violate your rights on their whims? 99.8% survival rate.

lol wtf

[TboneS54]

Originally Posted by Donatello.

lol wtf

Not too bright.

[Donatello.]

Originally Posted by TboneS54

Not too bright.

Me or the other poster?

[AmuroRay]

Originally Posted by Donatello.

lol wtf

Yeah man, it’s totally ok if the government violates your rights because they said it was totally for your own good.

[ezaircon4jc]

I read a lot of jealously here. Who cares what John Doe CEO makes. It's really none of my/our business. You would probably be shocked to hear what my salary was when I was fired/retired; and were were capped. In retirement, on a gummint (CSRS) pension, I'm still in the lower six figures.