Posted on 05/21/2016 6:51:49 PM PDT by MarvinStinson
Beware the $15 minimum wage for menial labor — it’ll eventually come back to bite you in the hindquarters.
As wages for fast-food workers continue to spiral upwards, hamburger chain Wendy’s is fast-replacing human workers with automation.
The company announced this week that by the second half of the year, ordering will be available through the use of self-service kiosks throughout its entire 6,000 locations, according to Investors Business Daily.
It will be up to each franchisee whether to use the new technology or to stick with the old system. Wendy’s President Todd Penegor observed that some locations have already raised their prices to meet increased labor costs.
IBD reported:
“It’s not surprising that some franchisees might face more of a labor-cost squeeze than company restaurants. All 258 Wendy’s restaurants in California, where the minimum wage rose to $10 an hour this year and will gradually rise to $15, are franchise-operated. Likewise, about 75% of 200-plus restaurants in New York are run by franchisees. New York’s fast-food industry wage rose to $10.50 in New York City and $9.75 in the rest of the state at the start of 2016, also on the way to $15.”
In order to curry favor with voters, politicians from both sides of the aisle have called for raising the minimum wage.
Sen. Bernie Sanders favors a $15 minimum wage — as a starting point. Democratic frontrunner Hillary Clinton has, at various times, suggested raising it to $10 an hour and on other occasions higher.
Even presumptive Republican presidential nominee Donald Trump said he’s open to the notion of raising the wage.
I see this as the start to a gradual move towards fully automated drop-in mini-food factories to replace the kitchen staff of fast food restaurants.
I think the easiest thing to automate next is the french fry station. The Wendy’s chili pots should be easy to automate too, using automated dispensing equipment to fill the chili cups. Really, from a technical standpoint, all of this is quite feasible and I imagine automation of much, if not most, of these cooking operations is in development right now.
The only thing stopping automation deployment is economics, namely automated equipment won’t be deployed as long as the current manual equipment operated by employees is cheaper than deploying new automated equipment. Increasing minimum wages, obamacare and all the rest are simply accelerating the deployment of such automation.
It now looks like the tipping point has been reached for the ordering process. No doubt every fast food operation in the U.S. will be keenly observing Wendy’s experience with their ordering kiosks, and should they be a success, the entire industry will very quickly embrace that technology.
At some point I’m guessing the Libs will make this illegal.
The actual minimum wage outside of a communist society is: $0.00. No work, no wage.
Yeah, I think Wendy’s learned their lesson about that with their now-failed (I think) drivethrough call center concept.
https://www.youtube.com/watch?v=ZW15G-Lf9Yo
Addendum: It didn’t fail because of the outsourcing, it failed (at least around here) due to workers in the store itself not doing their jobs.
The Italians have already figured out how to replace the pizza restaurant with an automated kiosk.
https://www.youtube.com/watch?v=j7_lxiU8eLM
” How long before they automate wives?
Husbands too.”
According to Zager & Evans, about 509 years from now. I think it’s going to be sooner than that.
When my oldest was in his teens, he had a friend who worked at Wendy’s, and he told me the secret to the chili, was that they never froze their burgers, and at the end of each shift, they would chop up the burger meat and put it in the chili.
I don’t know if they still do that, it’s probably pre-measured and frozen now, but I guess it was a way to get the most from your inventory.
In any event, I still love Wendy’s chili.
Actually there are many inevitable consequences. Automation is just one
Another one is inflation. Economics tells us that if an hourly worker is really worth $7.50 in 2016 dollars, and the government doubles his wage over the next few years there will be enough inflation to bring his new $15 wage down to $7.50 in purchasing power.
This inflation effects us all, not just the fast food worker. Essential, the real wages of most Americans are going to take hit. The elites will be able to prosper in an inflationary time, and many union members will be able to, at least in some ways, keep up with inflation.
The government always profits from inflation. Debt is inflated away.
The real losers are retirees and non-union workers. This is a wealth transfer from the old to the young.
It wont work. Jack tried it and so did Ronald. Both gave up on the idea. They will lose business and In and Out Burger will get busier.
Many do and have.
Wendy’s for lunch last week:
Their #1 with cheese, regular drink, regular fries; $6.75.
Central TX.
Whataburger, Burger King, Jack in the Box all similar or more expensive.
And these are the basic burgers.
All these chains offer “gourmet” burgers that are $9-10$ per offering.
Here in Texas, the only cheap lunch offerings are Julio taco stands.
Yes, no inflation, no price increases. Ignore what you see and believe the news. Best economy ever...../S
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