Thursday, September 4, 2014

Fast food wages

The news today is covering nation-wide protest demanding $15 per hour pay for fast food workers. I am all for this and have actually written to McDonalds suggesting that they increase the cost of their products and pass the money on to their employees. There is a story behind the story here that many are not aware of or have not given any thought to. First off upper middle income consumers are moving away from places like McDonalds and Burger King to places like Panera Bread and Chipotle. This leaves the middle and low income people as the primary customers for fast food places. Since there are a large number of people in each of these groups this allows for an effecting income transfer which will narrow the income inequality gap. It will be a transfer from those who don’t have a lot to those who have less. If wages go to $15 then there will be increased pressure on automation and the elimination of jobs. For those that remain there will be a trend to see fast food jobs as a career.

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