Former McDonald’s CEO Says it’s Cheaper to Buy Robots than Pay Workers $15 an Hour

[bonnie]

 

Former McDonald’s CEO Says it’s Cheaper to Buy Robots than Pay Workers $15 an Hour

 

From Fox Business:

“I was at the National Restaurant Show yesterday and if you look at the robotic devices that are coming into the restaurant industry — it’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who’s inefficient making $15 an hour bagging French fries — it’s nonsense and it’s very destructive and it’s inflationary and it’s going to cause a job loss across this country like you’re not going to believe,” said former McDonald’s (MCD) USA CEO Ed Rensi during an interview on the FOX Business Network’s Mornings with Maria.

According to the Bureau of Labor Statistics, 1.3 million people earned the current minimum wage of $7.25 per hour with about 1.7 million having wages below the federal minimum in 2014. These three million workers combined made up 3.9 percent of all hourly paid workers.

 

This increases unemployment and dependence on government welfare programs.

In other words, it’s a horrible idea.

 

 

Michael Cantrell

01:04pm May 24, 2016

 

Trying to explain why hiking the minimum wage is disastrous for the economy and low skilled workers is like attempting to explain astro physics to a chimpanzee.

Low to no skilled workers — like teens just entering the workforce — need minimum wage jobs like those provided by McDonald’s in order to start building a resume and help them learn basic skills that will give them a boost up the career ladder.

When you raise the minimum wage to $15 an hour for these jobs, guess what? Businesses stop hiring new workers, fire the old ones, and get machines to do the work instead.

In fact, former McDonald’s CEO Ed Rensi recently appeared on Fox Business where he stated it was cheaper to buy robots than pay employees $15 an hour.

 

[Bravus]

There are two things that can happen with robots and automation:

1. They replace workers, and lead to unemployment: some workers have no work, others work two jobs.

2. They replace workers, work is shared, and all have more leisure time. We move from a 5 or 6 day work week to 3 or 4, and live a life beyond just work and resting from work.

Both are completely plausible: the increased efficiencies of automation grow the economy.

As ever, the problem, and the reason we will get 1 rather than 2, is the wealthy people with all the capital, not the minimum wage workers.

Humans will never be able to outbid robots by working for less and less: they will simply starve.

We need more creative problem solutions that lead to more equity. Ironically, this will *also* make more money for those with capital. Because who is going to buy the products and services if all the workers are trying to outcompete robots and barely have enough for a roof and food?

Trying to solve these problems with the same solutions that created them gets us nowhere.

[bonnie]

25 minutes ago, David Geelan said:

 

As ever, the problem, and the reason we will get 1 rather than 2, is the wealthy people with all the capital, not the minimum wage workers.

Humans will never be able to outbid robots by working for less and less: they will simply starve.

We need more creative problem solutions that lead to more equity. Ironically, this will *also* make more money for those with capital. Because who is going to buy the products and services if all the workers are trying to outcompete robots and barely have enough for a roof and food?

Trying to solve these problems with the same solutions that created them gets us nowhere.

You seem to think this affects the wealthy people with all the capital. Go after the wealthy and all will be right with the world..Not true

Those that scrimp and save and stick their neck out for a McDonald franchise or??  take the hit. Having a franchise does not always wealthy make.  Generally they make 100,000-150,000 per year after a investment of hundreds of thousands of dollars. How much less should they be willing to work for to hire untrained,unskilled young people. New hires get 15.00 per hour.What do you then pay those that have a couple of years experience? Your managers? while the salary of the franchise owner stays stagnant at best,falls more than likely,still liable for all expenses involved.

My husband was one of those so-called wealth with all the capital. When he was in business typical starting pay for inexperienced was 8.00 per hour. Many times  the inexperienced would end up costing him money. They were paid before we, the wealthy got paid. Supplies and all the expenses that went with the business needed to be taken care of before our family. Minimum wage of 15.00 would have killed the business before it ever got off the ground. 

We have a very successful family owned hardware(franchise)they hire a lot of high school students. They are open 7 days a week,either husband or wife are there every day,sometimes both of them. I believe he makes a comfortable living,wealthy to some that want to punish business owners. If he is forced to pay 15.00 per hour to new hires,he is cutting back employees and hours. If that doesn't work he will close his business. He can't possibly raise prices enough to compensate.

McDonald's and other fast foods may be able to go to automation but the majority can't.

A friend of my husband's has a Perkins franchise. 16 hour days,7 days a week are common for him. What happens to his business when he raises prices to compensate for 15.00 an hour per employee

[CoAspen]

The other side is that someone has to build the robots. But...we now have robots building many things already. Somehow people are always needed, usually at higher levels of education. My son works in a highly automated(robotic if you will) food distribution warehouse. The work he was doing before is now done by automation...but he now maintains,programs, updates,etc that system.

[bonnie]

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[Aliensanctuary]

I don't believe that a robot could pick a hair out of a hamburger, but then, robots don't have hair.