As the struggle to raise the minimum wage continues across the country, a company is taking steps to encourage all its franchisees to follow suit from corporate stores and increase workers’ wages. However, McDonald’s employees who make more money may see that customers entering the restaurant have higher prices on their menus.
McDonald’s, Approximately 95% of its more than 13,000 restaurants have franchises, and the company is one of several companies that have been forced to fight for higher wages for the lowest-income employees — since 2009, the federal government has been $7.25. “Fighting for 15” has been going on for several years, causing hourly wages in some establishments to increase by $15 or more, but this is not the case in all retail or fast-food restaurants.
however, McDonald’s It was decided in May that by the end of June, the 650 companies-owned restaurants will begin to provide employees with an average salary increase of 10%. By 2024, the average salary of employees in these locations will reach $415 per hour. In this case, entry-level employees can earn $11-17 per hour, and shift managers can earn $15-20 per hour, depending on the location. Some franchisees have also followed the example of individuals in deciding to increase employee salaries, but other franchisees are still hesitant, because this may bring them bottom-line costs.
“Franchise operators are best suited to make wage decisions in the local community,” Matt Hall, senior vice president of government relations for the International Franchise Association, told NBC Finance ChannelPlease note that some people may be less likely to raise wages due to the cost of living in their area-in metropolitan areas with high housing prices (such as New York City and Los Angeles), the cost increase may be higher than in a more rural area .
Part of the problem that franchise owners may also face is that they need to offset the cost somewhere-which means that the customers their employees serve may be those Bear the brunt Wages have risen, menu prices have risen, and choices may even be limited.
Tom Locke, who owns Tom TreyCo franchise rights and 45 McDonald’s stores in Pennsylvania, West Virginia, and northeastern Ohio, told CNBC that his decision to increase employee wages before McDonald’s announced that it would pay employees in its own stores did come at a price. . The labor shortage not only forced him to reduce menu choices, but when he started to face higher costs, he had to raise prices slightly to offset them.
“This is a long-term observation of the business, not a very short-term observation of the business,” he said. “I think this is a better business model.”
Although it is not clear how much the price of his store has risen, or whether the price of the company’s store will rise as wages continue to rise, McDonald’s is not the only company that raises employee wages or raises menu prices as a result. chili sauce The same thing was done, resulting in a 4% increase in menu prices across the board.
Photo: AFP/Saul LOEB
