Trying to raise a family on a fast-food salary
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.
(Christine Owens is executive director of the National Employment Law Project.)