Fast-food workers are leveraging the labor shortage to demand higher pay on the anniversary of the last federal minimum wage increase 12 years ago

·3 min read
mcdonald's strike workers
Reuters/Lucy Nicholson
  • Fast-food workers across the country are striking to demand a $15 minimum wage.

  • Strikes and rallies are planned for the anniversary of the last federal minimum wage increase.

  • The current federal minimum wage is $7.25.

  • See more stories on Insider's business page.

Fast food and restaurant workers are planning actions across the country for July 20, the anniversary of the last time the federal minimum wage was increased in the US.

Fast-food workers will strike in nine cities to demand a higher wage, according to Fight for $15, the worker advocacy group which organized the strikes. The demonstrations are planned for Asheville, North Carolina; Charlotte, North Carolina; Charleston, South Carolina; Detroit, Michigan; Durham, North Carolina; Flint, Michigan; Houston, Texas; Milwaukee, Wisconsin; and St. Louis, Missouri.

At the same time, restaurant workers will hold protests and rallies to eliminate the tipped minimum wage.

"Twelve years without a raise in the minimum wage is way too long. I'm going on strike because I can't afford to wait any longer for $15/hr - not while costs are going up and I'm still recovering from the devastation of the pandemic," a McDonald's worker in Houston, Martha Osorto, told Insider in a statement via Fight for $15. "I show up every day to do my job, and now it's time for the Senate to do its job and raise the minimum wage so that all of us, regardless of where we live or work, are paid enough to survive."

Retail workers are in a unique position right now, with more leverage than at any time in recent history. Restaurants can't keep locations staffed at pre-pandemic levels, so they have to compete for workers with sign-on bonuses and other perks. The labor shortage in many sectors of the economy is a boon to some dissatisfied retail workers who are suddenly able to shop around for new jobs.

Restaurant workers quit at record levels in April, the most recent month for which there is data, and it's another sign that employers are going to have to work harder to attract and retain workers. Many venues are so desperate that they're posting signs pleading with customers to be patient because they don't have enough workers.

Read more: Travis Kalanick said CloudKitchens would transform restaurants forever. Restaurant operators say it's been a mixed bag, at best.

The quit rate, which refers to the percentage of people who voluntarily leave their jobs over the period, reached 5.6% in April for the foodservice and accommodations sector. That number is an all-time high for the industry, according to Gordon Haskett Research Advisors, and it was more than twice the rate of the economy as a whole, not counting farming jobs.

There are already some signs that the tide may be turning in workers' favor. In May, Chipotle announced that it would raise the average wage to $15 per hour, an increase of $2. The chain was looking to fill 20,000 positions and received 24,000 applicants shortly after announcing higher wages. Meanwhile, smaller perks like paying potential employees for interviews hasn't yielded the same results, hammering home the message that the only way to attract workers right now is to pay them more.

McDonald's also announced earlier in April that it would raise minimum wages at corporate-owned stores. Entry-level workers will make at least $11 per hour, and shift managers will make at least $15, boosting the average wage by about 10%. The chain is aiming to hire 10,000 new employees in the coming months and says its average hourly wage is expected to reach $15 by 2024. These changes will only impact about 5% of McDonald's workers, however.

The federal minimum was last increased in 2009, to its current level of $7.25. Some states have higher minimums, but in 2019, 392,000 workers earned the federal minimum wage, and 1.2 million earned less, according to a Bureau of Labor Statistics report, Juliana Kaplan reported for Insider.

Do you have a story to share about a retail or restaurant chain? Email this reporter at mmeisenzahl@businessinsider.com.

Read the original article on Business Insider

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting