Wendy’s has joined a long line of food service establishments that will replace workers with self-service ordering kiosks to reduce labor costs as a result of $15 minimum wage ordinances. The fast food company’s decision comes after many locations have “increased prices to offset the wage hikes.”
In addition to the move, Wendy’s is also “preparing to launch mobile ordering and mobile payment, another labor saving move.”
As the Washington Policy Center reports, it is not just food service companies looking for new ways (all involving reducing the amount of workers) to decrease labor costs as a result of $15 minimum wage laws.
As it struggles to “balance its budget in the wake of higher labor costs,” the University of California at Berkeley announced its intention to eliminate 500 staff jobs over the next two years. Tragically, the cuts will impact low-skills jobs that many inexperienced workers rely on for entry in the job market. The include “those who clean buildings, work in food services and health clinics.”
The job cuts will not impact faculty or administrative positions. Via the Washington Policy Center:
“While UC Berkeley did not attribute the job reductions to California’s newly increased minimum wage, the announcement was made just after the state passed a $15 minimum wage law. To be fair, the school was in financial straits before the state’s minimum wage hike, and would have likely been forced to cut some jobs. But the new $15 minimum wage means those cuts are much deeper than they would have been.”
Advocates of the $15 minimum wage made a lot of promises. They painted a rosy picture in which low-skilled workers would see a jump in their paychecks while assuring that no one would lose their jobs and hiring practices would remain healthy. That didn’t happen.
Unfortunately, it appears to be low-skilled workers who are bearing the consequences of increasing the minimum wage by an exorbitant amount.
As University of Washington Professor Jacob Vigdor put it:
“Minimum wage is often touted as way to address poverty, and working poverty; my professional opinion is that it is a two edge sword and sometimes it’s the bad edge of the sword that can dominate.”
