There was once a time when conservatives had the luxury of criticizing the minimum wage by stretching it to its logical extremes. In response to someone calling for a $9 or $10 minimum wage (as Obama has in the past), we could say “well, if $9 or $10 is so great, why not $15, $20 or $100 an hour?” There was a time you could stretch that number high enough and liberals would eventually realize there’d be consequences to such a high minimum wage.
Unfortunately, we now live in a world where caricatures have become reality. Sen. Elizabeth Warren wonders why we don’t have a $22 minimum wage (see why she doesn’t have much to ponder here), while former presidential candidate Sen. Bernie Sanders has rallied behind the “Fight for $15” cause.
Instead, let’s take a look at how business is reacting to higher minimum wages nationwide. As Ed Rensi, former president and CEO of McDonald’s USA writes for Forbes Magazine: As the labor union-backed Fight for $15 began yet another nationwide strike on November 29, I have a simple message for the protest organizers and the reporters covering them: I told you so.
It brings me no joy to write these words. The push for a $15 starter wage has negatively impacted the career prospects of employees who were just getting started in the workforce while extinguishing the businesses that employed them. I wish it were not so. But it’s important to document these consequences, lest policymakers elsewhere decide that the $15 movement is worth embracing.
Earlier this month, McDonald’s announced the nationwide roll-out of touchscreen self-service kiosks. In a video the company released to showcase the new customer experience, it’s striking to see employees who once would have managed a cash register now reduced to monitoring a customer’s choices at an iPad-style kiosk.
It’s not just McDonald’s that has embraced job-replacing technology. Numerous restaurant chains (both quick service and full service) have looked to computer tablets as a solution for rising labor costs that won’t adversely impact the customer’s experience. Eatsa, a fully-automated restaurant concept, now has five locations—all in cities or states that have embraced a $15 minimum wage. And in a scene stolen from The Jetsons, the Starship delivery robot is now navigating the streets of San Francisco with groceries and other consumer goods. The company’s founder pointed to a rising minimum wage as a key factor driving the growth of his automated delivery business.
Below is a photograph of four McDonalds workers earning $15 an hour:
Well, not really, but you get the point.
And is it really unrealistic to expect other industry leaders can’t help but follow McDonald’s lead? Of course not. In fact, it would be naive to expect otherwise.
Then again, naivety seems to be a core driver of the “Fight for $15” movement.
[Note: This post was authored by Matt Palumbo. Follow him on Twitter @MattPalumbo12]