McDonald’s CEO Supports Minimum Wage Hike, So What’s He Waiting For?
Amidst the ongoing battle to ensure that workers can earn a living wage, Don Thompson, CEO of McDonald’s, admit that he supports increasing the minimum wage to $10.10. Though it’s not quite the “supersized” paycheck that many of his employees have been calling for, it would certainly improve workers’ quality of life that much more. In a speech at Northwestern University, Thompson said, “McDonald’s will be fine; we’ll manage through whatever the additional cost implications are.”
While many have celebrated this proclamation, it’s hard not to interpret it as at least somewhat disingenuous. The CEO of McDonald’s does realize it can raise its wages without the government forcing it to, right? The “minimum” wage is literally the least a company can pay someone, not the encouraged rate of compensation. If, as Thompson has indicated, McDonald’s can afford to pay its workers better, why hasn’t it already?
It’s statements like Thompson’s that should give us pause when corporations tout the power of the free market. For the CEO to say, “Yeah, we can pay more if you make us,” is precisely why government regulations are often necessary to ensure the American labor force is protected. The supposedly benevolent free market is clearly not stepping up to ensure decent pay until it is forced to do so.
To be fair, while the company does not publicly release concrete figures, analysts estimate that the average McDonald’s employee earns just under $9 per hour. That’s a rate that is significantly higher than the $7.25 federal minimum wage, yet is simultaneously significantly lower than the $10.10 that the head of McDonald’s acknowledges would be fair. So, again, what’s the hold up, McDonald’s?
The CEO of Subway, Frank DeLuca, might help to clue us in on Thompsons’s line of thought. A fellow not-too-vocal minimum wage increase supporter, DeLuca recently explained that it’s better from a business perspective for the government to enforce a wage hike because then it would apply to all of his competitors equally. In other words, even when those in the free market want to do the right thing, they won’t out of fear that other businesses won’t follow suit.
Hypocrisy aside, Thompson’s statement is probably still good news. Given that corporate lobbyists have as much if not more clout in Washington as the politicians themselves, seeing the #1 fast food company won’t oppose an increased minimum wage is one less obstacle in getting such legislation approved.
Then again, McDonald’s declaration could also be a strategic one. With fast food workers across the country staging protests to secure $15 an hour, agreeing to $10.10 would be a cost-effective compromise that could help shut down future strikes. Plus, from a PR-perspective, being a low-wage corporation that publicly backs a higher minimum wage would help their image.
Apparently, even when corporations that pay employees minimum wage agree that it is time for workers to earn more, it still takes the government making it official for anyone to see the sentiment reflected on real paychecks. That’s all the more reason for Congress to pass a minimum wage increase. After all, if they don’t, what will change?
Photo Credit: Lancer E