If lawmakers were to raise the minimum wage to $15 per hour, it would “absolutely” kill jobs, former McDonald’s CEO Ed Rensi told Fox News host Neil Cavuto Tuesday.
Rensi, who was head of McDonald's in the mid-1990s and now runs a burger chain of his own, argued Tuesday that a $15 minimum wage would put 15 to 20 percent of small businesses out of business.
Fast food workers across the country took to the streets earlier this summer, with some demanding $15 per hour. Many fast food workers have said they're struggling to survive on their near-minimum wage paychecks and that their employers could afford to pay them more, citing the billions of dollars in profits some chains take in.
A $15 minimum wage is higher than most lawmakers are considering. But many studies have found that raising the federal $7.25 minimum wage by a couple of dollars -- as President Obama proposed earlier this year -- wouldn’t affect unemployment rates in any noticeable way, according to the Washington Post.
Current McDonald’s CEO Don Thompson earlier this year disputed the idea that his company pays poverty-level wages, telling Bloomberg that the company has always been “an above minimum wage employer.”
But it's not just a higher minimum wage that's threatening business owners, according to Rensi. “Obamacare is going to drop 15 to 20 percent of small businesses off the face of the earth,” he told Fox News.
The Obama administration disputed that claim in a recent study, which found that Obamacare would drive down the cost of health care coverage for small businesses.
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McDonald's Grew During The Recession
McDonald's had <a href="http://www.slate.com/articles/business/moneybox/2009/08/who_won_the_recession.html" target="_hplink">higher sales growth in 2008</a> than in 2006 or 2007, opening nearly 600 stores that year, according to Slate. The chain was able to take advantage of Americans' recession tastes: Cheap, convenient food.
They Handle Food That Isn't Really Food
One <a href="http://www.reddit.com/r/AskReddit/comments/w2sv3/fast_food_workers_of_reddit_what_is_the_one_menu/" target="_hplink">Reddit user claiming to be an ex-McDonald's worker</a> said he once left a bag of chicken nuggets out on the counter for too long and "they melted. Into a pool of liquid." That didn't stop him from loving the nuggets, "still delicious," he wrote.
Fast Food Companies See Huge Profits On The Backs Of Low-Wage Workers
More than <a href="http://www.nelp.org/page/-/Press Releases/2012/PR_MinWageCorpProfits.pdf?nocdn=1" target="_hplink">60 percent of low-wage workers</a> are employed by big corporations, according to a July analysis by the National Employment Law Project. And more than 90 percent of those companies were profitable last year.
The Average Pay For A Fast Food Worker In New York City Is $9 Per Hour
Fast food workers in New York City make an <a href="http://blogs.villagevoice.com/forkintheroad/2012/11/fast_food_forward_strike_nyc.php" target="_hplink">average of $9 per hour</a>, according to the Village Voice. That comes to about $18,500 per year for full-time workers.
Fast Food Workers Are Unlikely To Get Paid Sick Days
For 40 percent of private sector workers, <a href="http://articles.baltimoresun.com/2012-11-28/news/bs-ed-sick-leave-20121128_1_sick-days-care-workers-service-workers" target="_hplink">taking a sick day</a> and still getting paid isn't an option, according to the Baltimore Sun. Fast food workers are especially likely to be part of that 40 percent.
The Boss Can Threaten To Take Workers' Health Care Away
Many fast food workers saw their health benefits put at risk this year, if they even had them at all. <a href="http://www.huffingtonpost.com/2012/11/09/papa-johns-obamacare-john-schnatter_n_2104202.html" target="_hplink">Papa John's CEO John Schnatter</a> said he would likely reduce some of his workers hours so that he wouldn't have to cover them in response to Obamacare. Jimmy John's founder, Jimmy John Liautaud told Fox News in October that <a href="http://www.foxnews.com/on-air/your-world-cavuto/2012/10/16/jimmy-johns-founder-business-owners-unsure-future" target="_hplink">he would "have to" cut workers' hours</a> so that he wasn't forced to cover them under Obamacare.
The Average Hourly Pay At Many Fast Food Eateries Is Less Than $8 An Hour
The average hourly pay at McDonald's, Wendy's, Burger King and Taco Bell is less than $8 an hour, according to <a href="http://www.cnbc.com/id/50015355" target="_hplink">salary data cited by CNBC</a>.
The Median Age Of A Fast Food Worker Is 28
As more workers fight for limited jobs, many older employees are gravitating towards the fast food industry. The median age of a fast <a href="http://www.theatlantic.com/business/archive/2012/11/mcjobs-should-pay-too-its-time-for-fast-food-workers-to-get-living-wages/265714/" target="_hplink">food worker is 28</a>, according to Bureau of Labor Statistics data cited by the Atlantic. For women, who make up two-thirds of the industry's employees, that age is 32.
Labor Leaders Rarely Try To Unionize Fast Food Workers
Fast food worker's went on strike in late November in New York City, showcasing a rare effort to organize the industry's workers. Labor leaders often don't make an effort to organize these workers because the high turnover makes the challenge daunting.
Fast Food Workers Are The Lowest Paid Workers In NYC
For all their work, fast food workers get very little dough. The lowest paid job category in New York City is "Combined Food Service and Preparation Workers, Including Fast Food," according to Bureau of Labor Department Statistics <a href="http://www.salon.com/2012/11/29/in_rare_strike_nyc_fast_food_workers_walk_out/" target="_hplink">cited by Salon</a>.