McJobs Are the Future: Why You Should Care What Fast Food Workers Earn
Maybe most McDonald's workers don't make a career of fast food today. But will that be true in 10 or 15 years?
As I wrote earlier today, the corporate brass at McDonald's seem to believe that in order to survive on what they pay their restaurant workers, you need a second job. And hey, credit where it's due: they're probably right. Fast food wages are terrible. If you're relying on a minimum- or near-minimum-wage check each month, it means you're living life on the financial precipice.
Since this out, however, I've gotten a few pointed responses from readers, the gist of which was captured pretty well in this tweet by Vincent from Chicago (I assure you, I'm the one getting yelled at):
@JHWeissmann @binarybits You're an idiot. McDonald's IS NOT a career!-- Vincent (@VCON29) July 16, 2013
Vincent is hinting at a fairly sophisticated set of arguments you tend to hear from people who don't worry too much about minimum-wage workers, in particular. In brief: There aren't that many them; the jobs are mostly occupied by "suburban teenagers, not single parents," as the Heritage Foundation puts it; and people don't earn minimum wage for very long.
Or again, nobody makes a career as a cashier at McDonalds.
And there's something to all that. According to the Bureau of Labor Statistics, there were about 1.68 million workers earning the federal minimum wage in 2011, accounting for about 2.3 percent of the workforce. About half were below the age of 24, and as the Heritage Foundation notes, the vast majority of those minimum wagers were enrolled in school. Moreover, one study by the Employment Policies Institute estimated that, between 1977 and 1998, more than 65 percent of minimum wage workers managed to land a raise within a year of starting their job.
So with all of that in mind, here's my quick case for why you should still be worried about what companies like McDonald's pay their employees.
The Working Poor Are Real, And Some Earn More Than Minimum Wage
According to the Census bureau, 7.2 percent of American workers live below the poverty line. In other words, they far outnumber the ranks of minimum wage earners. Remember, even McDonald's cashiers earn closer to $7.72 an hour on average, according to Glassdoor.
Fast Food Workers Are Not All Suburban Teenagers
No, not every low-pay worker is a kid assembling Big Macs between classes. According to the Bureau of Labor Statistics, the median fast food worker (technically referred to as a combined food preparation and serving worker) is about 29. A full 40 percent of minimum wage-earners, meanwhile, are in their prime working years of 25 to 54. Sure, some are married moms working part-time so they can see more of their kids. But plenty aren't.
Promotions Don't Mean Much If You're Still Poor
Yes, low-pay workers might get raises, but they're not necessarily big. The Employment Policies Institute found that the median annual pay hike for minimum-wage earners was 10 percent. About a third didn't get any kind of raise at all. And this was during the 90s. In today's slow economy, the situation is presumably worse.
McJobs Are Probably the Future
During the recession, the economy shed millions of middle-income jobs in fields like construction and manufacturing. During the recovery, they've mostly been replaced with low-wage service work, exacerbating a trend that dates back to the turn of the century. As shown on the graph below, the the food services industry now accounts for 7.6 percent of all jobs, up from about 7 percent pre-recession, and about 6.2 percent around 2000.
And, in all likelihood, they'll account for even more in the future. The BLS projects that food services will be among the fastest growing source of jobs for Americans with no more than a high school degree -- right behind retail and home health aides. So maybe working at McDonalds doesn't usually amount to a career today. But it might tomorrow.