A Warning to Minimum Wage Workers: The Kiosks are Coming

I warned you.  Several months ago when the calls for raising the minimum wage and the strikes at fast food restaurants started, I warned that those participating were going to cost themselves and many other minimum wage workers jobs.  By increasing the cost of labor, you are making automation more competitive.  At $7 per hour, it is much less expensive and easier to hire cashiers than to install and maintain an automated system.  Now with calls for $15 per hour, the kiosks become more attractive – even critical.  This is because for $15 per hour, you should have the skills needed to fix the kiosks, not just punch buttons on them.

It all comes down to simple math.  If your standing at the register taking orders results in the fast food place making $12 per hour in revenues (about the amount they make), they can afford to pay you about $7 per hour, pay for the food and the building, and still make enough of a profit to justify the trouble.  If you demand $15 per hour, and especially if you have laws passed forcing them to pay you $15 per hour, they will need to cut the number of people they employ back as much as they can so that they can still make a profit despite the higher labor costs.  This means going to kiosks and cell phone apps for taking orders, and maybe even automating making the food.   Someday soon you may go to a fast food place, enter the order yourself, then place your burger on a conveyor belt to be cooked.  You’d then go to a condiment stand to add toppings and many customers would think this was just great.

And that’s the other sad thing.  I generally hate automation because it means doing everything myself.  I hate paying just as much for airline flights now, despite the fact that I now need to key in my own flight information and bag information.  I even often need to take my own bag over the TSA agents and hope they don’t steal anything out of them.  I miss just being able to tell the ticket agent my name and where I was going and have him or her do the rest of the work for me.

Still, many in your industry aren’t helping your cause.  The last time I went to a McDonald’s, two people were standing at the counter texting, including the person who took my order.  This presented a terrible image and made me wonder how much the employees cared about getting orders out.  You make yourself more valuable by providing a service to the customer and doing everything to improve her experience.  If the person taking my order is just going to stand there texting, rather than doing everything possible to get my order quickly and presenting the best possible image for the restaurant, there might as well be a kiosk standing there.

So if you want to make more money, learn new skills.  Do things to help your employer make more money – like serving customers faster and making their experience as good as possible so that more people come to the restaurant.  Make yourself more valuable by generating more money per hour so that there is more money to pay you with.  Try to get more money through force, and you’ll find that the laws of economics can’t be changed just because you want them to.  Prices will rise so that your paycheck will buy the same amount as it does now, you will be automated out of a job, or the restaurant will close down and you’ll again be out of a job. Trust me.  

Contact me at vtsioriginal@yahoo.com, or leave a comment.

Disclaimer: This blog is not meant to give financial planning advice, it gives information on a specific investment strategy and picking stocks. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.

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