Starting Monday, most California fast-food workers will earn at least $20 an hour — the highest minimum wage across the U.S. restaurant industry. Yet the pay hike is sparking furious debate, with some restaurant owners warning of job losses and higher prices for customers, while labor advocates tout the benefits of higher wages.
The new law, signed by Governor Gavin Newsom last fall, takes effect on April 1, requiring that fast-food chains with at least 60 locations nationwide pay workers at least $20 an hour. The means the state’s 553,000 fast-food workers will earn more than the state’s $16 minimum wage for all other industries.
The new baseline wage comes as the fast-food industry is seeing booming earnings, with big chains like McDonald’s enjoying strong revenue growth and wider profit margins in recent years. That’s partly due to menu prices that have far outpaced inflation, with fast-food costs surging 47% over the past decade, compared with an average of 29% for all other prices, according to a new analysis from the Roosevelt Institute, a nonpartisan think tank.
In California, near me, the closest McDonalds, Panera’s, and Togo’s have adopted kiosk-based ordering, which takes the human out of the ordering loop. None are pure kiosk (at least not yet).
The Panera’s also had orders dropped off at tables, and appears to have ended that practice; they also removed the numbered buzzers. Now they’ll notify a cell phone if a number was entered at the kiosk, and if not, call the name on the receipt from the pickup counter.
EDIT: Actually, as a result of this conversation, I went over to the Togo’s in question, where the manager – who I think, from hearing her talk to people during some remodeling work, is also the owner of this particular franchise location – was working the counter along with some other employees. She confirmed that Togo’s was gonna see the minimum wage increase, sounded worried about what it was gonna do to costs. Then immediately the other guy waiting at the pick-up counter started complaining about California housing costs and both of the two started complaining to each other about inflation.
The cell phone thing is for data collection fyi, buzzers are cheap.
Yeah, I don’t want to be in their database so opt to have my name called, but often miss them calling from the pickup counter now. It is definitely obnoxious.
Come to think of it, I wonder if anyone has built a database linking phone numbers to Bluetooth UUIDs? I assume that software on a cell phone can obtain the phone number and the Bluetooth UUID and the full name of the user, so probably free-to-play games and the like will sell it.
And if that’s the case, if you correlate with that data, you can identify customers from the Bluetooth UUIDs.
I’m sure if the data CAN be collected, it is collected. Then sold, and used to track you.
Some places, like big box stores, do track the cell phones of people in the store. And you can bet that they correlate that with all the other info on you that they have.
https://www.cbsnews.com/boston/news/stores-spy-on-customers-by-tracking-cell-phones/
According to business leaders, this should have lowered the prices heavily, since they say labor costs is such a huge part of the final price right?
So… did the prices go down?
This automation and these kiosks aren’t the result of increased wages as these are things a business would install anyway because it’s just a single, fixed, upfront cost and not something the requires scheduling, biweekly paychecks, health insurance, training, etc. We’re setting more of them now because the technology has gotten better and cheaper.
Sorry to hear that Togo’s has been enshittified. There was one near my studio in Burbank back when I lived in L.A. and I went there all the time. (I got to eat lunch there with Jeffrey Combs! Worship me, pigs!)
My go-to was an egg salad hero with tabbouleh on it.
Man that place was awesome. I really miss it. That sucks to hear.
I think that Doctorow was referring not to just something undesirable happening at a company with that, but specifically the transition of a consumer-facing Internet company from the growth phase to the monetization phase.
I don’t think that Togo’s was trying to rapidly grow while losing money and then shifted to try to make money, a la what he was talking about. I would guess that there are one of three things going on:
They (and other food places) have minimum-wage labor as a major chunk of their costs, and so they’re preparing for the imminent increase by cutting how much labor they need and automating what they can. My guess is that this is probably the dominant factor, given the change that California is about to see.
There’s been a lot of inflation. My understanding is that wages tend to be more sticky than inflation – this guy who started chatting with me at the counter in my above comment said that he only saw a 5% raise last time around, whereas last year saw something like 10% inflation – so I’m guessing that if inflation spikes, you tend to have a period where people are spending less, and it may be that prepared food is an easy thing to reduce spending on. That’d mean that they’d have a rough time in an inflationary environment. Although…hmm. If it’s an inexpensive restaurant, it might benefit, because one might see more people shift from more-expensive options to inexpensive options. Giffen goods aren’t exactly the same thing, but work on that sort of principle – an increase in cost can increase consumption because of substitution effect for a more-expensive alternative dominating.
Automation has just been getting cheaper/better, and has finally reached the point of working well enough that it can replace human workers at point-of-sale. I remember when supermarket automated checkouts were just a complete disaster, took way longer to slog through than a human checker. Now, while I’ll take a human checker if available, I don’t avoid automated checkouts like the plague any more.
Thanks for the recommendation. I’ll already grabbed my food this time, but give it a shot next time around.
EDIT: Nah, apparently it’s gone. I asked a worker, and they said that they did offer it at one point, but egg salad was discontinued. Ah, well. I guess it might relate to the very-elevated prices for eggs during the avian flu problems recently. Maybe if egg prices come back down…