When “Raise the Wage” Backfired
Rewind to a few months ago when we reported that McDonald’s appeared to be testing touchscreen ordering devices:
McDonald’s employees who picketed for a better living wage (whatever that means) may come to regret that decision. According to a Redditor, a McDonald’s in Illinois replaced their cashiers with machines. The machines appear to be the cousins of the ones found in grocery stores, big box stores, and CVS that allow customers to complete transactions.
It turns out McDonald’s is no longer merely testing the devices but is planning widespread implementation. Tanking profits are forcing fast food chains like McDonald’s to reconsider how much their front line employees are worth, particularly when these employees continue to demand more money.
According to the Wall Street Journal (emphasis added):
If there’s a silver lining for McDonald’s in Tuesday’s dreadful earnings report, it is that perhaps union activists will begin to understand that the fast-food chain cannot solve the problems of the Obama economy. The world’s largest restaurant company reported a 30% decline in quarterly profits on a 5% drop in revenues. Problems under the golden arches were global—sales were weak in China, Europe and the United States.So even one of the world’s most ubiquitous consumer brands cannot print money at its pleasure. This may be news to liberal pressure groups that have lately been demanding that government order the chain known for cheap food to somehow pay higher wages.The McDonald’s earnings report on Tuesday gave a hint at how the fast-food chain really plans to respond to its wage and profit pressure—automate. As many contributors to these pages have warned, forcing businesses to pay people out of proportion to the profits they generate will provide those businesses with a greater incentive to replace employees with machines.
Enter the machine:
By the third quarter of next year, McDonald’s plans to introduce new technology in some markets “to make it easier for customers to order and pay for food digitally and to give people the ability to customize their orders,” reports the Journal. Mr. Thompson, the CEO, said Tuesday that customers “want to personalize their meals” and “to enjoy eating in a contemporary, inviting atmosphere. And they want choices in how they order, choices in what they order and how they’re served.”
As the Wall Street Journal and many others have pointed out, entry level burger-flipping jobs are not intended to be long-term, family-supporting endeavors. Yet the Raise the Wagers love to use low-wage earners as political pawns to target those with successful careers and businesses.
Next News Network has the breakdown:
Even more problematic for the “Raise the Wage” crowd is that the automation trend is not limited to fast food chains.
Lowe’s hardware store has developed a fleet of robots to assist customers.
Meet the OSHbot. OSHbot isn’t quite as cute as WALL-E, but we’ll forgive it for that.
The OSHbot is designed to assist customers locate items they need. Looking for hammers? OSHbot will take you there. Need a particular nail? Place the nail in front of OSHbot’s viewfinder and it will show you where you can find it. No hablas Inglés? No problema! OSHbot is also multilingual.
OSHbot will go live at an Orchard Supply Hardware store in San Jose, California in the near future.
As more retailers respond to minimum wage demands by replacing workers with technology, we can’t help but wonder where unions will turn for their next anti-capitalistic scape goat.
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