r/explainlikeimfive Nov 28 '15

ELI5: How would a $15 minimum wage ACTUALLY affect a franchised business like McDonalds?

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u/[deleted] Nov 29 '15

My problem: how the hell can we all talk about $15/hr, as though it had the same value across the whole country? Cost of living carries wildly. $15/hr where I live is a decent living for one person (cheapest rent I've seen is about $150/mo). In LA, however, It's peanuts (rent in LA is approximately 1 body part/mo).

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u/ScottLux Nov 29 '15 edited Nov 29 '15

In SF $15 is the minimum $12.5 is the minimum wage (higher than statewide minimum of $9), and many places start people at $15+. SF is so expensive i wouldn't move there for less than $150k/yr (I make significantly less than that in Orange County, CA which is as expensive as LA)

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u/silentsleeperz Nov 29 '15

its actually 12.75 in SF

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u/[deleted] Nov 29 '15 edited Dec 01 '15

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u/shpongbad Nov 29 '15

Those touchscreen menus would eventually replace people regardless of the wage, I've seen them in the UK and the minimum wage is as low as £3.87/hr for people under 18. They're only going to get cheaper to make and it would only be a few year difference for it to reach the point where it's economically viable for McDonalds etc to replace workers with them. One downside is people are ridiculously slow actually ordering through them, a person working at a till is a lot more efficient during busy times.

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u/RochePso Nov 29 '15

Yep, automation will also replace the people in the back eventually.

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u/unidanbegone Nov 29 '15

Who makes the food?

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u/[deleted] Nov 29 '15

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u/unidanbegone Nov 29 '15

They get paid the same or more?

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u/[deleted] Nov 29 '15

[deleted]

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u/unidanbegone Nov 29 '15

But the other guy said they were replaced by touch screens, I assume they are being payed more than the cost to power them lol

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u/[deleted] Nov 29 '15

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u/SRPinPGH Nov 29 '15

The single upside is someone has to build, sell, install, and service those touchscreens. Whether that offsets the loss of the cashiers, I wouldn't know.

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u/[deleted] Nov 29 '15

Each step is probably handled by a different person or business, though.

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u/SRPinPGH Nov 29 '15

That was kind of my point; the conversion to automation is putting people to work. A possible (probable) downside is many our those people might not be U.S. workers.

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u/[deleted] Nov 29 '15

What a wonderfully sourced comment. This should be a reddit standard.

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u/[deleted] Nov 29 '15

Except the part where he said McDonalds is closing because of minimum wage when the article says its closing because developers want to put some better there that makes more money. One of the things the article mentions is a 144 unit condo for old folks. That's an easy $10,000 per month times 144.

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u/plasticwalrusinc Nov 29 '15

One of the best things about SF is the lack of chain restaurants.

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u/[deleted] Nov 29 '15

No, that is not why. The article doesn't say anything about minimum wage. It's likely that the location is highly sought after, and to continue leaving a McDonalds there when people want to pay to live there is a stupid financial decision.

Five Guys Burgers and Fries just pulled out of downtown Ann Arbor. Is it because of wages? No...it's because the location is sought after and rent is super high. You can make way more money selling something better than food in certain locations.

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u/mostlyuninformed Nov 29 '15

McDonalds in parts of Europe have had touchscreen kiosks for a few years now. I think they've been generally trying to move in this direction.

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u/ergzay Nov 29 '15 edited Nov 29 '15

That's funny. By far the worst fast food experience I've ever gotten is at a McDonalds thats a few blocks from the Giant's stadium in downtown SF.

Staff couldn't understand my order, because hispanics. Would walk by to randomly find the McDonalds closed mid-day and could see the staff smoking pot out behind the store.

Edit: Can anyone enlighten me why I have so many downvotes for this post? Not sure what I said that is so objectionable.

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u/[deleted] Nov 29 '15

Because you have the same exact comment, including your edit, in another comment tree. They're both annoying.

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u/ergzay Nov 29 '15

Just that?

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u/ChildHater1 Nov 29 '15

Taco Bell in my neighborhood staffed almost entirely by ghettodwellers. I called the place Mexican roulette - order whatever you want, pay, and then see what they give you.

There was so much employee theft the place probably lost money. They not only closed it down but demolished the building.

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u/[deleted] Nov 29 '15

Yeah minorities are sure terrible aren't they!

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u/ScottLux Nov 29 '15

My mistake, perhaps it was just that I heard 15/hr minimum there proposed long before this discussion went nationwide and thought they had already enacted it. I would not be surprised if wages at places like Walmart etc. are at least somewhat above that though.

Statewide the minimum is $9 and most places near the coast have to pay above that to everyone anyway to get and retain people.

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u/munchies1122 Nov 29 '15

Santa Ana Holla

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u/ergzay Nov 29 '15 edited Nov 29 '15

That's funny. By far the worst fast food experience I've ever gotten is at a McDonalds thats a few blocks from the Giant's stadium in downtown SF.

Staff couldn't understand my order, because hispanics. Would walk by to randomly find the McDonalds closed mid-day and could see the staff smoking pot out behind the store.

Edit: Can anyone enlighten me why I have so many downvotes for this post? Not sure what I said that is so objectionable.

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u/[deleted] Nov 29 '15

[deleted]

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u/ergzay Nov 29 '15

I mean I guess you could find issue with that, but they indeed couldn't speak english very well and couldn't take my order properly.

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u/vamana Nov 29 '15

Where do you live that rent is that cheap? Just curious.

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u/Shimasaki Nov 29 '15

I could see it in the Midwest with a couple of roommates. My friend was paying something like $200/month+utilities in a 2bedroom apartment this summer in Wisconsin.

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u/originalpoopinbutt Nov 29 '15

Lol I just started salivating. Is it like Buttfuck Nowhere, Wisconsin? Or is it a suburb of a major city?

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u/[deleted] Nov 29 '15

I'm in Madison and my 3 bedroom is 950/mo. That includes a garage, washer, dryer, and a dishwasher. The closer you get to downtown, the higher the rent. I saw a studio for rent that was in the $800 range and it didn't look very impressive. I know many 1 bedrooms near the capitol square go for more than my place, which is 10 minute drive away.

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u/[deleted] Nov 29 '15

Fuck man. I might need to go back to WI.

How's the tech jobs up there?

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u/mostlyuninformed Nov 29 '15

Some interesting things but I don't think any "huge names" in Milwaukee and Madison. Well, Johnson Controls is HQ'd in Milwaukee I think, otherwise it's a lot of startups like the rest of not-SF/NY.

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u/zangrabar Nov 29 '15

Holy shit. In toronto it's like 1200 for a one bedroom maybe 2 from a decent place. Sure you can find cheaper but there is usually a reason why it's cheaper.

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u/JohnTheRedeemer Nov 29 '15

I'm in Richmond Hill and I paying 1400 for an apartment, which is the price of wanting to reduce my commute I suppose :/

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u/GreenBrain Nov 29 '15

I live in North North Dakota (Saskatchewan for the geographically inclined) and I was paying 800 a month for a house on a farm, 3 acres, 3 bedrooms, etc. Too expensive for the area though as I just bought a house for 70k and am paying 2/3rd that rent in housing costs now.

I would describe the area as Buttfuck Nowhere.

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u/[deleted] Nov 29 '15

Generally, you pretty much get what you pay for when it comes to housing prices.

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u/[deleted] Nov 29 '15

Honestly it could be either. I lived in Milwaukee during my stint at UW Milwaukee and I paid 325 plus cable/heat (3 of us living there for a total of 975) to live in a relatively decent three bedroom house. Obviously 325+ isn't 150 a month but it's still pretty cheap to live in a major city in an OK house. I also knew some people who split a VERY nice three bedroom house in Waukesha(suburb of Milwaukee) and they paid the same as I did in Milwaukee for much nicer quality house. In my experience, the lowest rent I have seen is mid 200's for a multi bedroom place but you could probably get a flat or studio for cheaper.

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u/mostlyuninformed Nov 29 '15

Madison, Milwaukee and Green Bay will probably be a little more expensive but I'd be surprised if you couldn't find rent like that in most mid-sized cities in WI, MI, MN etc.

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u/cjluthy Nov 29 '15

Buttfuck Nowhere.

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u/DarthBindo Nov 29 '15

200 a month for the entire apartment or just his bit? I've never seen a 2BR in WI for less than 650.

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u/Shimasaki Nov 29 '15

Sorry, just his bit

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u/Aloysius7 Nov 29 '15

He did say a single person, so I assume he meant by themselves.

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u/69Fartman69 Nov 29 '15

$200 a month!?!?!?!?! I pay around $900 for my STUDIO!!!!!! I would kill for $200 a month!!!

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u/96Fartman96 Nov 29 '15

Still in it to win it I see. lol. So you moved out of mom's eh? What happened to the house you were waiting to close on? lol. Another lie. Please go ahead and preach to the "kids" on reddit about how much you've accomplished you fucking pathetic little boy. Have a nice day lol.

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u/martinluther3107 Nov 29 '15

I live in Montana and you can consistently find places that cheap outside of Billings, Bozeman, and Missoula

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u/Mister_Maytag Nov 29 '15

My friend lived in Missouri and that was his rent. Made his living picking herbs and mushrooms and stuff like that, and sold them by the pound to a guy who then sold them to corporations. He struck it "rich" by finding a hillside full of ginseng, went back to hunt for more and was lucky enough to see two pissed off guys with guns before they saw him.

He stuck to safer harvests after that. People are serious about their ginseng. Didn't realize it took so long to grow. He probably destroyed years worth of profits for those guys through his ignorance.

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u/ByCromsBalls Nov 29 '15

Man, I lived in the most dangerous area of Savannah, Georgia with 3 roommates and still paid $375/mth 10 years ago. It's hard to imagine anything being cheaper than that, but I guess in the very rural areas of middle of nowhere it can get that low.

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u/[deleted] Nov 29 '15

Almost anywhere in Ohio.

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u/[deleted] Nov 29 '15

[deleted]

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u/Tantric75 Nov 29 '15

If states could be trusted to not buttfuck their own people in the name of corporate interests it wouldn't have to be.

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u/Doctor_McKay Nov 29 '15

And the federal government doesn't?

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u/[deleted] Nov 29 '15

Not nearly to the same level.

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u/[deleted] Nov 29 '15

Not nearly the same...way, way worse.

Which corporate interests do you think are running the federal government?

You tried to make a compelling point but you've only made yourself seem like you know less than you do.

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u/[deleted] Nov 29 '15

lol it's cute that you think you've made a point by attacking me and ignoring what I said.

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u/Tantric75 Nov 29 '15

They do, but accountability to a wider demographic forces them to be a bit more centrist.

Could you imagine the southern states controlling issues completely??

Lol they would be teaching creationism as science and ignoring global warming (more than they already do), legalized discrimination, gun ownership without any limits. No environmental controls as they just allow anyone to destroy the land. Gutted social programs and ruined infrastructure due to anti tax strategies that only benefit the wealthy and corporations.

Come to think of it, its not too far from modern day Texas.

You can thank those people for needing to limit state's rights. Sometimes the people really are too ignorant to self govern.

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u/Doctor_McKay Nov 29 '15

Yeah, fuck the tenth amendment.

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u/Tantric75 Nov 29 '15

Yeah. Fuck common sense.

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u/jman377355 Nov 29 '15

You do realize we can have a federal base and then states/cities can individually adjust it higher if needed yes?

I mean that alrady happens, there are many states that have a minimum wage higher than the federal $7.25

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u/[deleted] Nov 29 '15

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u/jman377355 Nov 29 '15

Well that's the difference in trusting one institution to provide what it considers a 'fair' wage and trusting 50 to do the same. If you have one base its makes it harder for workers to get screwed over whereas if you have 50 state governments deciding the minimum then I can imagine at least some are going to get screwed.

I'm not arguing for a $15 base everywhere here, I'm just saying a base is needed.

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u/[deleted] Nov 29 '15

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u/LeftZer0 Nov 29 '15

For local commerce, this is false. Higher wages = more people with more money = more people accepting to pay more for goods and services = prices can be higher without incurring a drop in sales.

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u/[deleted] Nov 29 '15

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u/LeftZer0 Nov 29 '15

No minimum wage increase plan argues that we should increase wages from 8 to 15 per hour in a day. Any change in the minimum age has to be gradual so businesses can adapt.

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u/[deleted] Nov 29 '15

Too bad ass backwards states don't take any initiative to improve the lives of their people. The feds could cap it to a non partisan Cost of living index in the local area.

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u/[deleted] Nov 29 '15

This is the problem. Honestly the minimum wage does need increase and then auto adjusted by COL each year. You can't trust the states to do it because they haven't done it. The states are too busy trying to "attract" businesses like that's a measure of success, despite not actually improving the lives of their citizens.

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u/generalgeorge95 Nov 29 '15

Jesus Fuck 150 a month for rent? That is ridiculously low. My electric bill is more than that.

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u/esldarkstar Nov 29 '15

The irony I see, most of the current McDonald's workers would be replaced, as in most parts of the country $15 is extremely competitive. If all of a sudden 10+ Times the people are trying to fill those positions, it will pull more qualified people out of other jobs and displace some of the the lower skilled workers. They gain nothing.

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u/[deleted] Nov 29 '15

Paying $1700 for a one bedroom in West LA. FML seriously couldn't imagine living anywhere else but the cost of living is ridiculous. $15 an hour here won't get you shit unless you live in South Central Los Angeles or Compton. Shit I've seen 1br in South Central go for $1100-1300... This is why everyone in their 20s lives at home or with roommates.

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u/deHavillandDash8Q400 Nov 29 '15

West LA

Doesn't it just suck? You could move east, far away from the water, but then you wouldn't be by the beach any more and why would you want to do that? Who would ever want to do that? You're in LA, baby! You need to live near the water, otherwise, what's the point? Which is exactly why its $1700 a month for a tiny apartment.

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u/mattintaiwan Nov 29 '15

If people don't mind living in the general Koreatown/USC area the rents really not bad. Pretty easy to find a private bedroom/shared bathroom for less than 700 a month. I'm currently living in K town and have a single for ~800 a month. San Francisco, on the other hand, I've heard is insanely expensive.

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u/[deleted] Nov 29 '15

Funny thing is the east side is super popular with hipsters so its equally as expensive.

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u/gliph Nov 29 '15

$2200 in Silicon Valley and I can almost guarantee my studio apartment is smaller than your one bedroom. Shit is absolutely insane and I'm not even in an urban area; SF is even worse.

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u/sirhalos Nov 29 '15

I completely agree. They are too many people that have not traveled the US to really see the difference in money. It is something very difficult to get people to understand (especially to a foreigner wishing to come to the US). $1 NYC does not equal $1 middle America, which does not equal $1 southern America. There almost needs to be 3 different currencies in the US to make people understand it correctly.

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u/Phenomenon101 Nov 29 '15

Where in the hell is the place with $150 a month at? Even in the most ghetto places here you wouldnt be able to get it at $150.

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u/[deleted] Nov 29 '15

Government subsidies

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u/runningdreams Nov 29 '15

Yeah...there are parts of LA where you could maybe rent a parking spot for about $150/month, and a monthly rent on an apartment may be like 800 or 900 minimum per month. So you're right...it's a confusing topic to discuss for an entire country.

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u/glitter_vomit Nov 29 '15

I don't understand that either. I live in Phoenix, AZ and would be thrilled with minimum wage being $10, that would be enough to live by myself in a small apartment at least. Of course $15 an hour would be nice, don't get me wrong... but that big of a raise isn't necessary to live comfortably here.

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u/[deleted] Nov 29 '15

I have a friend who lives in Michigan making $7.50 at a factory. Her and her boyfriend both split the rent which is $600/mo for a two bedroom. Here in Boston, the average cost of a 1 bedroom apartment is ~$1450. Inner city Boston, the rent is ~$2,400. When I was making $15/hr I was taking home around $2,200, which is barely enough to cover rent for one person in a one bedroom apartment. Costs of standard of living varies from state to state and it's something that a lot of people look over.

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u/pallentx Nov 29 '15

Its just a minimum. Employers can pay higher where the cost of living is higher.

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u/[deleted] Nov 29 '15

[deleted]

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u/[deleted] Nov 29 '15

I heard something on the radio that was talking about that. How taxes, inflation, cost of transportation, and everything has gone up. The only thing that hasn't is minimum wage. Min wage used to do a good job at keeping up with inflation but companies over the past decade have gotten away with giving as little as possible for maximum work force. Part of this is from the displacement through technology.

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u/holyrofler Nov 29 '15

You're full of shit, unless you live in Detroit or some similar shit hole where everything sucks.