As multiple cities like Los Angeles and New York enact $15 minimum wage requirements, fast food chains are taking drastic steps to avoid massive financial losses. More and more, they're turning to automation, and not just in the kitchen.
According to the UK Mirror former McDonald's CEO Ed Rensi admitted that buying a robot is now cheaper than employing a worker at the new wage level.
"It’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who’s inefficient making $15 an hour [around $30,000 at a year with some deductions] bagging French fries," Rensi explained. "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. It’s not just going to be in the fast food business. Franchising is the best business model in the United States."
And Rensi doesn't the pace of change slowing anytime soon, saying, "The more you push this, it’s going to happen faster."
As for the employees who manage to keep their jobs amidst massive cuts to the human labor force, London Business School professor Lynda Gratton says things will get more difficult for them as well.
"As middle-skilled roles disappear, workers may find that the 'rung' above them no longer exists, and that the career ladder may begin to look more like a career web," she explained.
Domino's Pizza, Carly's Jr., Hardee's, and Wendy's have also been testing and implementing robotics and self-serve kiosks in their locations.