Trying to raise a family on a fast-food salary

By Christine Owens
August 29, 2013

Fast-food workers in more than 50 cities Thursday are striking for fair pay and the right to form a union — the biggest walkout to hit the industry. This latest round of labor unrest comes 50 years after hundreds of thousands of Americans, led by Martin Luther King Jr., joined the March on Washington for Jobs and Freedom, demanding not only civil rights, but also good jobs and economic equality.

One demand of the 1963 marchers was raising the federal minimum wage to $2 an hour. In today’s dollars, that’s roughly $15 an hour — what the striking fast-food workers are now calling for.

For all the progress made since 1963, the reality is that economic inequality persists and continues to grow. Income inequality is greater today in the U.S. than in any other OECD nation, except Chile, Mexico and Turkey, and exceeds that of many developing countries.

Almost one-quarter of all jobs in the United States pay wages below the poverty line for a family of four. CEO compensation, meanwhile, continues to climb. It would take a full-time, minimum-wage worker more than 930 years to earn as much as the chief executive officer of Yum! Brands, which operates Taco Bell, Pizza Hut and KFC, made in 2012.

Fast-food workers are in the lowest paid occupational category. The median hourly wage for frontline fast-food workers is $8.94 nationally. Many don’t even earn that. A shortage of hours further limits income. Fast-food workers work only 24 hours a week on average — at $8.94 an hour, this adds up to barely $11,000 a year.

Wages are so low that many workers have to turn to public assistance for basic survival. Which means that taxpayers must subsidize the poverty wages that fast-food corporations pay their employees.

That’s indefensible, especially considering corporate fast-food giants are enjoying robust profits. McDonald’s raked in $5.5 billion in profits in 2012 — a 27 percent increase in profits over five years — while YUM! Brands posted $1.6 billion in profits last year.

But these profits are clearly not trickling down to the frontline workers. The fact that the workers are willing to strike — one of the riskiest things any worker, but especially a low-wage worker, can do — shows how untenable the situation is.

The fast-food industry lobbyists promote the stereotype that fast-food workers are teenagers earning pocket money. In fact the majority of fast-food workers now are adults, with a median age of 28. These are jobs that many adults are dependent on to support families. More than one in four fast-food workers are raising children, according to a Center for Economic and Policy Research study. This trend is mirrored broadly across our low-wage workforce: 88 percent of low-wage workers are adults today, compared with 74 percent 35 years ago.

The fast-food worker protests are taking place in the context of a disproportionate expansion of low-wage work in the U.S. economy. The Bureau of Labor Statistics estimates that seven of ten growth occupations through 2020 will be low-wage, including jobs with big-box retailers and fast-food chains. This shift toward low-wage work in our labor market is a decades-long trend that has accelerated during the recession and subsequent recovery. Low-wage jobs represented 20 percent of the jobs lost during the recession, but constitute 60 percent of jobs gained in the recovery.

What can we do to address this low-wage jobs crisis? Exerting pressure on the fast-food and retail giants that rake in billions in profits is a good starting point. These companies can afford to share more of their wealth with their frontline workers and should be doing so.

Federal policymakers also need to act on raising the federal minimum wage — which now stands at just $7.25 an hour — to boost wages broadly across the bottom of the labor market. It’s also time for Washington to get serious about investing in the creation of good jobs.

Boosting wages for America’s lowest-paid workers is a crucial step toward reducing economic inequality and rebuilding a strong economy. Perhaps 50 years from now, we’ll look back on the fast-food workers’ fight as the catalyst we so desperately needed.


PHOTO (Top): Workers and labor activists march down West Grand Boulevard as they demand a raise in the minimum wage for fast-food workers in Detroit, Michigan, May 10, 2013. REUTERS/Rebecca Cook

PHOTO (Insert): People demonstrate outside a Burger King franchise on 116th Street in New York, April 4, 2013. REUTERS/Shannon Stapleton

 

31 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

And some of my friends wonder why I am pro union.
When the unions were busted in the early 1980′s where I reside by “right to work” legislation, that stopped contributions to my retirement at about 8Âľ years of pension credits. The contractors for whom I worked for the other 30 years got rich, while we craftsmen out in the field who were actually doing the work for them got the shaft.
Karma did wind up bankrupting one of the larger contractors, but that is of little consolation to me when I get my paltry pension benefit each month.

Posted by olemanallen | Report as abusive

Sometimes fiction is more real than fact:

Neo: The Matrix.

Morpheus: Do you want to know what it is?

Neo: Yes.

Morpheus: The Matrix is everywhere. It is all around us. Even now, in this very room. You can see it when you look out your window or when you turn on your television. You can feel it when you go to work… when you go to church… when you pay your taxes. It is the world that has been pulled over your eyes to blind you from the truth.

Neo: What truth?

Morpheus: That you are a slave, Neo. Like everyone else you were born into bondage. Into a prison that you cannot taste or see or touch

Posted by BidnisMan | Report as abusive

A similar article was on Reuters a few weeks ago. I mentioned it to my wife. She’s a receptionist and a very good one. She is maxed out on pay for her position, but does not believe so. When I explained to her that there were people prepared to raise the minimum wage, her response was “Then I want one too!”. Hence the problem with just raising the wage. Social/structural changes are a better way to get better living standards.

Posted by tmc | Report as abusive

The fact is that only 2% of working Americans earn the minimum wage. That the median age of the workforce is 28 is meaningless without knowing the distribution of age and earnings. This article is low on information and high on rant.

If the minimum wage were doubled, all other wages would rise to maintain parity between skills and hourly earnings. The US would then experience cost push inflation. Rising wages would also aggravate the problem of job loss due to automation.

Poverty is not a simple problem and will not be ameliorated with simple solutions.

Posted by bigbirddog | Report as abusive

One of the problems with this article is that the low income of 11.000 a year is for only 24 hours per week. As a full time (hourly) professional, I could not afford to live on only 24 hours a week either. Someone making minimum wage should expect to work 40-50 hours per week like any full time employee in order to make ends meet. If that means working two jobs, that is what they may have to do. I refuse to feel sorry for someone who only works part time. And paying twice as much is NOT the answer.

Posted by M_Holley | Report as abusive

“This shift toward low-wage work in our labor market is a decades-long trend that has accelerated during the recession and subsequent recovery. Low-wage jobs represented 20 percent of the jobs lost during the recession, but constitute 60 percent of jobs gained in the recovery.”

This is the future that many are in denial of. With each passing year, not only in America but the entire world, it takes fewer and fewer people to do what must be done. That is because of steadily rising productivity through machinery, automation, computers and the capabilities of inexpensive software.

The “Information Revolution” brings to any literate computer owner all necessary information to educate themselves, to start and run a business, and, in general, more useful information than all of the oracles and advisers of all the Chiefs,, Kings, Queens and other high officials of all societies in history could access. This is a genie that cannot be put back in the bottle.

Since the 1980’s, the need for millions and millions of Girls Friday, Secretaries, Administrative Assistants, stock clerks, bookkeepers, draftsman, designers, Project Coordinators, and the like…all good-paying middle class jobs with a “future” has incrementally disappeared. Not “offshored”. Not “outsourced”. Just GONE. FOREVER! No “union” can change the forces at work here.

Today any well run business knows that those who break down their employee requirements (“jobs”) such that one or more individuals can be productive the first week, good the second and at the “top of the game” within a month on the job can accomplish the necessary with abundant “off the street” part time hires. For the great majority, these will be “dead end jobs” with no future beyond initial pay and responsibility.

These people need only be warm and breathing that can read with reasonable comprehension and do simple addition, subtraction, multiplication and division, and understand fractions and decimals. So long as their hours do not constitute “full time work” they do not earn overtime, vacations, sick leave or pensions…i.e. those “benefits” most expensive for employers to provide.

“It’s also time for Washington to get serious about investing in the creation of good jobs.”

Get this, and get it STRAIGHT! Washington has NOTHING to invest it does not extorted from productive taxpayers. The only ability it has thus far demonstrated to create jobs is to hire more and more UNION government workers to sit around, gossip and push papers back and forth.

Such people forever seated at the public trough are forever a drag on our economy because they produce NOTHING of value, and most are minorities paid more than “We, the people” who must pay them with no seat at the bargaining table. That’s taxation without representation, and history tells us we fought a war over that same situation in order to found this great country.

Posted by OneOfTheSheep | Report as abusive

It is really very, very, very, simple.

It is quite clear the current Obama administration’s
policies are creating unemployment at a tremendous
rate.

It is a triple whammy:

1. Bernake prints free money for large corporations to use
on robotics and other “employee” saving computer and other technological devices.

The large corporations could not afford this infrastructure without zero interest.
The corporations would not do it, unless the equipment was so inexpensive due to zero interest.

Bernake then scratches his head and wonders why employment decreases with zero interest rates ? Crazy.

Wake up, technology and robotics are removing need for
much man and woman power.

Your current administration is moving that rapidly forward by the Fed printing and zero interest rates.

2. At the same time Obamacare makes the cost of the
employee rise, as does all the talk of increasing
the minimum wage.

So why would you not get a robot,
why would you not go abroad,

3. Add in Globalization and there you have it.

You can’t pay someone in India .50 an hour to sew
a skirt, and pay someone in CA $ 10.00 to sew a skirt,

and then add in pollution control and many other additional expenses in CA that do not exist in India.

and expect the skirt in CA to cost less.

Again, it is really very simple.

.

Posted by Alexaisback | Report as abusive

@ OOTS Good perspective. With increasing automation and greater reliance on technology, the demand for low-skill workers will continue to decline. Even the military knows this, and the former “employer of last resort” now rejects almost 50% of high school graduates for a variety of reasons-with 25%+ unable to pass the basic skills requirement (i.e. reading comprehension and basic math).

This will require that we rapidly re-tool our entire secondary and junior college system in order to prepare young people for the new jobs. And, it will require our elementary schools deliver a greater percentage of students that perform at grade level to the high schools. (Reading,writing, math…repeat) That will only get done by totally redefining how education is delivered and how competency measured (I can hear the teacher unions howling already).

As for our four-year universities, their day of reckoning is within view as well, and the current “keep as many seats filled as possible” business model is going to be displaced. We are going to see many four-year schools closing, and our major colleges will be using more online courses to keep tuition costs down and offer a more comprehensive agenda. Your college town professor at State U is going to be displaced by the subject matter expert from Stanford via online, and many colleges are going to literally close their doors. (Is that the tenured PhD’s I hear whimpering in the background?)

The downside is that the longer we postpone this initiative, the greater the pain when reality overwhelms tradition. Much like the federal deficits and entitlement programs, the education establishment can either be proactive and embrace change, or it will hit them like a tsunami with an inordinate number of casualties.

Posted by COindependent | Report as abusive

Has everyone forgotten that some jobs are supposed to be for teenagers, not to earn a living on? If you make every job pay enough to earn a living, teenagers will not be able to find work and there will be fewer jobs period.

Unionizing fast food workers seems crazy, because that is the very lowest rung of work that anyone can do. With many people desperate for jobs any strike will result in every worker being tossed out and replaced that day, because there would be MANY people willing to cross a picket line, and you could easily train new staff in a day in a pinch.

Posted by SirBill | Report as abusive

What is really indefensible is that between government mismanagement of the economy, high taxes, a ghastly public education system, and a pending limitless supply of eager, low-skilled immigrant workers, fast food employees labor is hardly worth minimum wage.

If the wage was magically raised to $15 without any consequence to the employers, these same people would find themselves out of work because $15 would attract better applicants. The result will be that the semi-literate, high school drop out that currently has a 29.99 hour a week job (thanks Obamacare) at FastBurger and is mostly dependent on government aid to get by will instead be entirely dependent on government aid to get by.

Posted by MattBraynard | Report as abusive

Twenty eight years is the average age of a fast food worker. Those people should be ashamed of themselves for taking jobs from high school students who need them. Any person who aspires to work a low wage job as a career choice needs serious help.
If you are living in one of those blue states which depress jobs with excessive taxes and regulations then move to a business friendly state and get a better job. Most people are one choice or skill away from success, these workers have made poor choices and now are finding it hard to pay the price.
It is not businesses job to pay workers a living wage, only a fair wage. If these employees want more money then go to school, get a marketable skill or degree, start at the entry level and work your way up the employment ladder.
These strikers should be ashamed of their actions. No company owes them anything. I seriously hope they are replaced by automation, thus reducing the cost of production. Owners do not risk everything to supply those with little to no skin in the game with wealth. Fact is these workers are getting just what they deserve.

Posted by thejustavenger1 | Report as abusive

The real problem is that these jobs are not meant to raise a family on a fast-food salary. These jobs are meant to be part-time jobs for teens new to the workforce & to save up for school.

The real problem that we should be dealing with is teen pregnancy. We should be making a concerted effort to dramatically lower those stats. Free condoms, Sex Ed classes, etc. The funds necessary to make a difference would be dramatically smaller than the billions that it will cost us in the long run.

Posted by Fmello | Report as abusive

If we would stop importing so much poverty from Mexico and Central America we wouldn’t have so many people willing to work for pennies, depressing wages on the lower rung. Rampant illegal immigration hurts the poor most and helps the rich get richer with greater profit margins. Everybody else pays for it with more entitlement costs to help pay for the working poor.

Posted by shodson | Report as abusive

It’s simple…DON’T try to raise a family on fast food salary. McDonalds jobs are for high school kids. Not head of households.

If you can’t offer an employer ANYTHING that literally the other 7 billion+ people on the planet can do just as well after just a 2 hour training session, then you shouldn’t expect to be raising a family on your salary.

Posted by lakawaka | Report as abusive

Shaniqua Davis, it’s not McDonald’s fault that you chose to become an unmarried, teenage mother:

Posted by SquirrelHill23 | Report as abusive

The issue is not robotics, but the price/wage spiral. Every dollar printed has a GNP-based value. Floating more dollars cheapens them. Make minimum wage $100 per hour and a cup of coffee will soon cost $100.

Posted by McNasty | Report as abusive

Such people forever seated at the public trough are forever a drag on our economy because they produce NOTHING of value, and most are minorities paid more than “We, the people” who must pay them with no seat at the bargaining table. That’s taxation without representation, and history tells us we fought a war over that same situation in order to found this great country.

Posted by zlz131886 | Report as abusive

If the fast food workers are getting raised (by 50% from what they earn), then all other jobs based on the skills and type of careers need to be paid in double as well…

Posted by mr_mojojojo | Report as abusive

Entitlement, entitlement, entitlement. What happened to working wanting to work hard and earn what you want to make in your job and any non-idiot realizes that fast food isn’t hard work. It’s menial. The machines do half the work already. Sure I think they should make more than 7.25 but they are effin crazy if there work is worth 15. That is retarded. There are entry level tech support jobs that most have degrees for that don’t pay that much. Do they need too? Not really. You have to work your way up the ladder not moan and complain because your unhappy with the fact that you’re not doing anything with your life. This world does not exist with the sole purpose to provide you with things. You have to give for what you get and if all you’re giving is “Thank you for your order” and “Will that be all?” then get that amount in return. It sucks that you are trying to raise a family on fast food wages but maybe you should realize that it’s not going to work and take the proper steps to better your situation not demand a handout. Fucking ridiculous.

Posted by boonda | Report as abusive

As someone who worked retail for five years making $6/hour, I understand how frustrating it can be to work long hours, get spat on by customers and get paid squat for it…something I think 99% of people on the US have experienced at one point. WITH THAT SAID…I spent years working two jobs and going to school at the same time…one of those jobs was a stipend that paid me MAYBE a dollar per hour when it was all said and done…to work my way through a college I couldn’t afford. Then when I got out, I spent months sharing a bedroom with my nine-year-old sister, then a few more on a couch, then a few more in the guest room of a friend, because I struggled with underemployment despite the degree I’d just sacrificed a third of my life striving toward. But I didn’t go on strike or boycott the government. I kept working and kept applying. I literally applied to thousands of jobs (I have the spreadsheet to prove it), all over the country and was even REJECTED from several fast food places, wherein I would have GLADLY accepted $7.25/hour before finally, after so much work and sacrifice, found something that pays well (STILL not as well as fast food workers are demanding) and could offer me a future. It wasn’t just handed to me. I didn’t go up to Wall Street and demand Obama use his magical job-making machine and get me a job. I never gave up and, most importantly…I PERSEVERED…a word I’m afraid has vanished from the vernacular of many modern youths who want all the benefits of their life choices but none of the consequences. You can’t go to school because you have three kids? That was your life choice. You could have been more responsible (obviously, before I get all the “OMG WHAT A DOUCHE!” responses, I know this isn’t ALWAYS the case) and waited till you were in a financial position to afford children, but you DIDN’T. My brother is in the same situation…busted his ass delivering pizzas and working for minimum wage at grocery stores and restaurants to pay for a degree (he, also, incidentally, does not make as much as fast food workers are demanding). So I’m sorry if it makes me the world’s biggest jerk(incidentally, I’m rubbing my leather-gloved hands together and twirling my long mustache as we speak, all while wearing a monocle), but I just can’t see giving people something I–and many others–worked so, so hard to earn.

Posted by jax88 | Report as abusive

What they don’t talk about with this is how fast food workers are immigrants who are taking jobs from Americans. A study by CIS shows how teenage employment over the past number of years has dropped substantially because of immigration. Teenagers are being locked out of employment in high school because of this system, and it’s not fair to them. No doubt high unemployment has forced older adults to work in these places, but the immigration equation is an important part of this as well. I wish the mainstream media would stop ignoring it.

Posted by Calfri | Report as abusive

Not to be crass, but what would happen to America if we stopped eating at fast food restaurants? Less obesity and the same number of people being on welfare?

Posted by euro-yank | Report as abusive

The article clearly has a point of view, but the factoid that the median age of fast food workers is 28 is misleading. Mostly because the fast food places hire many teenagers to work after school hours, but the also hire many retirees to work the day shifts when the teenagers aren’t available. If you look at the whole pool, yes, half are below 28 — far below 28 — and half are above 28 — far above 28 — and few are actually in those middle age ranges (and probably most of them are managers).

Posted by Fred_PA_2000 | Report as abusive

Since when did working at a fast food restaurant become a career?

Also it is simplistic to say that these restaurants are a whole entity. A good majority of them are franchises and are run by individuals that invested in them. The whole logic of investments is trying to receive money back on your investments. Yes McDonald’s may make $5.5 billion but that is not as a whole.

And if these jobs are so bad, why are there people lining up to fill them.

Posted by KFJ3000 | Report as abusive

honestly the notion that we subsidize low wage employees with tax dollars is anti-democrat views from an american dream standpoint (aka work hard and you can get ahead). It’s anti-republican because you cannot call those companies self sufficient when they aren’t paying their employees enough to live off of thus getting the rest of their money from people who have nothing to do with their company. And thirdly it’s anti-capitalism to expect your employees to get paid by someone else, in fact (though I hate to use this term)the companies who do this could very well be seen as pro-socialism at least for their low end workers.

Posted by Serraph | Report as abusive

fast food jobs have always been viewed as temporary jobs unless you are part of management. Even then the managers and assistants are out and gone within 5 years’i know the unions are all for the highest wage possible so they can make even more money from the workers. That is their bottom line, then a large part of their money goes to the democrats in order to buy a political party influence. Higher wages drive up prices, and in some cases cause layoffs, or complete shut downs. And the majority of the workers will not work any harder even for a higher wage.

Posted by fredbedrock | Report as abusive

Poor poor unskilled laborers. They want the same rate that i started earning after college. Granted, i did not have a great job but it was a skilled job in IT. Unfortunately its a losing battle teaching economics to high school educated workers.

Posted by spenny | Report as abusive

@Serraph,

Your opinions are “anti, anti, anti”. Please try to be more positive. Any well run company will arrange their affairs so as to pay the least taxes under applicable laws and to get the people to do what they need done for the least cost.

Subsidizing low wage employees with tax dollars is what in Europe is called “social democracy”. That is what is bankrupting Europe.

We all have dreams, but those who try to live in them are usually called alcoholics or addicts.

Posted by OneOfTheSheep | Report as abusive

“But these profits are clearly not trickling down to the frontline workers. The fact that the workers are willing to strike — one of the riskiest things any worker, but especially a low-wage worker, can do — shows how untenable the situation is.”

The exact opposite. When you get paid little there is less risk in striking because you have nothing to lose. These jobs are unskilled so it’s hardly like they’re putting their careers on the line by striking.

Posted by colsa2 | Report as abusive

Maybe a simple solution is not having a famuily while working at a fast food restaurant. This worked for generations of American teens who did that work until uneducated deadbeats took over and started expecting it to pay the bills rather then a stepping stone.

Another great idea is have 2 incomes from 2 parents if raising a kid. If your a single parent… sorry that’s not societies problem but your own. Or even better have a shared living environment like many many have done in past generations saving to get ahead. But heaven forbid todays generation actually has to plan ahead, save, and live small while they work on something big down the road.

Posted by Syanis | Report as abusive

Everyone like to blame the corporate greed, but this situation will not change until the people take the initiative on an individual level.

Anyone who is “living on a fast food salary” will qualify for tuition aid and grants. Making under $18k means you have practically a free ride through community college. Get an associate degree, and start making $30-40k within 2-3 years.

Why do people continue to take these jobs as a lifelong commitment? Fast food jobs should be treated as nothing more than temporary jobs for work experience or extra income, not to support a family. If you need the job, take it, and keep looking for something else.

But as long as people continue working for so little, and do nothing to make themselves qualify for higher pay, then it will not change for them.

Posted by ew0054 | Report as abusive