The Washington Post reports on how one Sacramento, California, Chick-fil-A owner is increasing hourly wages at his restaurant “to $17 to $18 from the $12 to $13 he pays now.” The move comes some four years ahead of a scheduled minimum wage increase in California to $15 per hour.
According to the story, “The sizable raise represents a possible new high-water mark for fast-food workers, say restaurant industry analysts, at a time when competition for even unskilled labor is rising amid low unemployment, greater immigration scrutiny and fewer teenagers seeking to work in fast-food jobs. While analysts can't say whether a $17 to $18 hourly wage is the highest in the country for front-line fast-food workers, it certainly appears to be among the higher ones.”
Eric Mason, the owner, refers to the increased pay as “a living wage,” and says that “as the owner, I'm looking at it big-picture and long-term. What that does for the business is provide consistency, someone that has relationships with our guests, and it's going to be building a long-term culture.”
The Post story notes that “many restaurant chains also operate on even tighter margins, making it harder to raise wages without raising prices for consumers or cutting into profitability. But the high cost of turnover in the restaurant business — the turnover rate in the restaurants and accommodations sector was 73 percent in 2016, according to Bureau of Labor Statistics data — could mean a raise is canceled out by savings in retraining and hiring new workers.”
According to the story, “The sizable raise represents a possible new high-water mark for fast-food workers, say restaurant industry analysts, at a time when competition for even unskilled labor is rising amid low unemployment, greater immigration scrutiny and fewer teenagers seeking to work in fast-food jobs. While analysts can't say whether a $17 to $18 hourly wage is the highest in the country for front-line fast-food workers, it certainly appears to be among the higher ones.”
Eric Mason, the owner, refers to the increased pay as “a living wage,” and says that “as the owner, I'm looking at it big-picture and long-term. What that does for the business is provide consistency, someone that has relationships with our guests, and it's going to be building a long-term culture.”
The Post story notes that “many restaurant chains also operate on even tighter margins, making it harder to raise wages without raising prices for consumers or cutting into profitability. But the high cost of turnover in the restaurant business — the turnover rate in the restaurants and accommodations sector was 73 percent in 2016, according to Bureau of Labor Statistics data — could mean a raise is canceled out by savings in retraining and hiring new workers.”
- KC's View:
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I love this. It has long been the argument here that increased pay can lead to a more stable workforce that will offer its own level of savings and even heightened profitability.
