Of all the stoopid, stoopid arguments against raising the minimum wage to $15 an hour, by far the most stoopidest is the claim that higher wages would price fast food beyond the means of low-wage workers. “It would definitely hurt the consumer,” International Franchise Association president Stephen J. Caldeira recently told the New York Times.
So how unaffordable might your favorite fast-food burger become should restaurants be forced to pay their employees a living wage? Caldeira warns that prices could rise by as much as 50 percent.
But that is bullshit.
Fifteen dollars would represent a 60 percent premium above Washington State’s 2013 inflation-indexed $9.33 an hour minimum wage, but the fast-food industry estimates that labor accounts for only one-third of its total costs. One-third of 60 percent equals a 20 percent hike in operating costs.
But fast food is already incredibly cheap. I walked into the McDonald’s on Madison Street last week to be confronted with a plethora of Dollar Menu and Extra Value Meal choices. Two bucks plus tax bought me a burger and a coffee. The coffee was actually good.
So even given a worst-case scenario in which the entire cost of higher wages is passed on to consumers in the form of higher prices, Seattleites would still only pay a far-from-wallet-busting $1.20 for an iconic McDonald’s hamburger. That’s 20 percent more than the current Dollar Menu price, but—adjusted for inflation—about 20 percent less than the same burger cost when McDonald’s first opened back in 1948.