Fast Food Workers Strike - Anybody Affected?

[Cow Poke]

Seems better to have fast food customers soak up the costs instead of inflicting them on everybody else.

In a "I don't know anything about business" world, that may work fine, but the fast food industry is VERY competitive, and most of them answer to share holders. This assumes that fast food customers will willingly "soak up" the fact that a Big Mac costs 50% or 100% more today that it did last week, and continue buying just as many as they did in the past.

That makes no sense at all.

[Truthseeker]

Tradeoffs in economics aren't necessarily 1:1. Raising the minimum wage to a certain point will cause a certain amount of inflation, but will also raise the economic well-being of a certain number of people. It's conceivable that raising it anywhere up to a certain point would raise well-being substantially more than it would raise inflation, and beyond which point the social and economic benefits of well-being might no longer out-weigh the costs of inflation and other effects of a raised minimum wage.

Ah, but how would you measure well-being? Say, that of the whole nation. Inflation can be measured to some extent, although there is a bewildering variety of ways to measure it.

Tradeoffs do have to be made, but only individuals, not companies nor the government, can meaningfully make them. Say the government forces a certain trade-off. Why? How do we know, really know, the world would be consequently better?

I await your explanation.

[Cow Poke]

One of the reasons fast food places make money is that consumers weigh the cost of "eating out" to the cost of eating at home, or packing a PBJ sandwich. It doesn't take much to tip this scale to the "skip the fast food".

[Truthseeker]

Seems better to have fast food customers soak up the costs instead of inflicting them on everybody else.

I'm afraid Darthy will skip over this post, but anyway . . .

OF COURSE businesses passes on all their costs to their customers. Failure to do so means going out of business. (To be sure, sometimes businesses do absorb increases of their costs, but that is temporary.)

[Cow Poke]

One place to find a few cents could be the CEO pay and benefits.

Many of these fast food places are franchises... they have absolutely no power or authority to take money from top management. They have fixed costs, and one of the few variables is "labor".

It's also possible that a substantial increase in wages might lead directly to only a marginal increase in the price of the product.

Meh..... you don't think these places try to squeeze every penny of profit out of their operations ALREADY? Where ELSE can they get the "extra money" without passing the costs on to customers?

[Cow Poke]

One place to find a few cents...

How many employees do you think the average fast food establishment has, especially those that are open 24/7 and cover all shifts, and how does 'a few cents' cover the 50 to 100% increase in employee costs?

[Darth Executor]

In a "I don't know anything about business" world, that may work fine, but the fast food industry is VERY competitive, and most of them answer to share holders. This assumes that fast food customers will willingly "soak up" the fact that a Big Mac costs 50% or 100% more today that it did last week, and continue buying just as many as they did in the past.

That makes no sense at all.

The law would affect all of them. Which is why Canada somehow manages to still have a fast food industry.

[Cow Poke]

The law would affect all of them. Which is why Canada somehow manages to still have a fast food industry.

Canada doesn't count. It's full of Canadians.

[tabibito]

Australian minimum wage is $640.90 / 40 hour week ($16.37/hour). Price of a Big Mac is $4.95 Australian.

[Spartacus]

Many of these fast food places are franchises... they have absolutely no power or authority to take money from top management. They have fixed costs, and one of the few variables is "labor".

In which case franchises will cease to be profitable unless Corporate takes some money out of its own pocket, and then Corporate loses all of its profits.

Meh..... you don't think these places try to squeeze every penny of profit out of their operations ALREADY? Where ELSE can they get the "extra money" without passing the costs on to customers?

Could you re-state that first part? I'm not sure how it relates to my point.

[Zymologist]

Tradeoffs in economics aren't necessarily 1:1. Raising the minimum wage to a certain point will cause a certain amount of inflation, but will also raise the economic well-being of a certain number of people. It's conceivable that raising it anywhere up to a certain point would raise well-being substantially more than it would raise inflation, and beyond which point the social and economic benefits of well-being might no longer out-weigh the costs of inflation and other effects of a raised minimum wage.

Ok, how do you know where to draw the line? The reason I asked the question is that most people who advocate raising the minimum wage seem to take a very simplistic all-or-nothing approach. If we question the wisdom of it, we are immediately castigated, because obviously it's a good idea.

[tabibito]

Ok, how do you know where to draw the line? The reason I asked the question is that most people who advocate raising the minimum wage seem to take a very simplistic all-or-nothing approach. If we question the wisdom of it, we are immediately castigated, because obviously it's a good idea.

Not so much. It's more a case of allowing companies to pay subsistence wages is a bad idea - and they will (with few exceptions) pay subsistence wages if they aren't forced to do otherwise.

[Spartacus]

Ok, how do you know where to draw the line? The reason I asked the question is that most people who advocate raising the minimum wage seem to take a very simplistic all-or-nothing approach. If we question the wisdom of it, we are immediately castigated, because obviously it's a good idea.

They've drawn a line at $15/hour presumably because they locate the cost of living somewhere around there.

[Cow Poke]

Stepping out of the weeds for a moment, remember --- this is about unions controlling, not about lives being better for poor people.

[Cow Poke]

Not so much. It's more a case of allowing companies to pay subsistence wages is a bad idea - and they will (with few exceptions) pay subsistence wages if they aren't forced to do otherwise.

And, at what point will the fast food companies find it's WAY CHEAPER to turn these menial tasks over to robots. The last time I was in McDonald's, there was a robotic drink fountain dropping the correct size cups, dropping ice, filling with the proper product, then conveying them to the take-out window. Then they can REALLY cut down on the number of these higher-cost employees.

(somewhat tongue-in-cheek, but maybe not so much)