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Remember reading an article in Forbes back in the '80s that cited a study comparing the profitability of McDonalds franchises that paid minimum wage, and those
by MaysonL 9y ago
Remember reading an article in Forbes back in the '80s that cited a study comparing the profitability of McDonalds franchises that paid minimum wage, and those that paid somewhat higher. Guess which were more profitable? The ones who paid higher wages.
- JustSomeNobody 9y agoAt what point does the law of diminishing returns kick in, though? McDonalds fries are good, but not THAT good, so at some point it's just not worth going there any more.
- mmmpop 9y agoI like to think this is because the workers are more inspired to work harder to "earn their keep". I'd say it's more likely the boss is keeping a closer eye on the workers' productivity and insists upon a bit more effort. I think it's a win-win but my lack of faith in humanity (read: cynicism) causes me to worry about those not interested in putting that much effort into a "minimum wage job". I understand the perceived need for something like a $15 minimum wage but as a guy who has always considered himself quite benevolent when paying subcontractors their actual value, I have a hard time swallowing the whole deal. Again, probably my own shortcomings but it would be interesting to understand how this might affect the attitudes of your typical "minimum wage worker".
- mikeash 9y agoDid the study consider the possibility of confounding factors? For example, I'd expect McDonald's locations in wealthier areas to pay higher wages because labor is in higher demand, and be more profitable because their client base is larger.
- MaysonL 9y agoYes, they matched the sites examined for socioeconomic locations.
- GhostVII 9y agoDid the study determine which way the relationship went though? Only McDonalds that are making a profit will be able to afford to pay more than minimum wage, a struggling one will obviously not be able to do that very easily.