Fast food workers around the country have been protesting for a $15 minimum wage.
A couple of days ago we warned about the possibility of McDonald’s replacing $1 menu with a buck-and –a-half menu … ouch!. The core story line: economists modeled the impact of raising the minimum wage for fast food workers to $15 and concluded that, all else equal, fast food prices would have to go up by about 40% to cover the increased labor costs.
Ooch. Continues a historic trend … As time rolls on, a buck buys you less and less at Mickey D’s
Since that post, a couple things happened.
First, McDonalds reported a 3.7% decline in global same-store sales.
That ranks as the company’s worst global same-store sales results in more than a decade.
Profit margins are shrinking and the company is trying to upmix customers to higher margin menu items.
Not exactly the time to be asking for a 66% raise, right?
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Adding to the discourse, a couple of loyal readers fed me some red meat: the realistic possibility that, very soon, low skilled burger flippers will be eased out by burger-making robots.
Here’s the scoop …
The Homa Files 