McDonald’s has been the target of militant campaigns denouncing the level of remuneration for years. The day before the brand’s annual meeting of shareholders, on May 20, the movement Fight for $15, who is fighting for an hourly wage hike in the United States, has called a strike by employees of the fast food chain in fifteen American cities. The move took place despite promises of increases made a week earlier.
The group has indeed announced that its 36,000 employees would see their salaries revalued by 10% on average, and that the new contracts would go from 11 to 17 dollars an hour. The hiring of 10,000 people in the 650 restaurants that are not under franchise is also planned over the next three months. McDonald’s is following in the footsteps of two other fast food chains, Chipotle and Olive Garden, which recently announced wage increases as they seek to recruit.
Forced generosity
According to Sara Senatore, analyst at Bernstein, the fast-food giant “has enough to reinvest in its wage policy”. The group announced annualized growth of 14% in the first quarter, thanks to the explosion of online orders. And since customers spend twice as much when they do
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deliver to their homes and 20% more when using a mobile device, the operating margin reached 44.5%, the highest figure in years. McDonald’s has no plans to increase the price of its burgers at this time, and the pay boost will have minimal impact on its profits, most of which comes from franchise royalties paid. by the 14,000 restaurants that the company does not directly manage.
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But this social generosity is explained first of all by the general lack of manpower in the United States and elsewhere. With the resumption of activity, about 8 million jobs have not found a taker in the United States. A shortage that can be found in other countries. In Australia, for example, unfilled jobs have jumped by 40% compared to early 2020. This shows upward pressure on wages. According to the Brooklyn Chamber of Commerce, novice cooks in this New York neighborhood, paid $ 15 an hour before the pandemic, are now offered up to $ 25.
Nearly half of American SMEs are having difficulty recruiting, a phenomenon that began before the pandemic.
Deep movement
Most experts believe this shortage will fade as fears of workplace contamination subside and children return to school. But, observes Mark Zandi, an economist at Moody’s Analytics, “wages had started to rise even before the pandemic, and companies were already struggling to recruit.” With the return to normal, employers are going to have to find new ways to attract staff.
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Offering a burger to candidates who run, like McDonald’s in Florida, will not be enough. Some restaurateurs no longer hesitate to offer health protection, including to their part-time employees. Brooklyn being a very “woke“(” conscientized “), societal commitments and on equal opportunities are multiplying, with, for example, programs for the reintegration of former delinquents.
© The Economist – London 2021
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