Employees and employement in fast food industry

Early snack food manufacturers and fast food chains were highly dependent upon their employees. Milton S. Hershey, founder of the Hershey Company , recognized their importance and created an ideal community that offered employees parks, pools, and other amenities. He also offered insurance programs and a retirement plan decades before it became common to do so in America.

Likewise, White Castle, the first fast food chain, set up a medical expense fund for the company’s employees and their families. The company also set up profit-sharing systems with cash bonuses. When the company began competing with other fast food chains that did not offer such benefits to their employees and were consequently able to undersell White Castle, these programs were curtailed.
Today, three fast food corporations— Burger King, McDonald’s, and Yum! Brands (which manages Kentucky Fried Chicken, Pizza Hut, Taco Bell, Long John Silver’s,and A&W Restaurants)—employ about four million people worldwide and operate 120,000 restaurants. The industry is a major employer in America and its labor practices have been frequently criticized. The fundamental key to success of the fast food industry has been cheap labor and, on the whole, the industry pays minimum wage to the majority of its workers. Fast food chains have intentionally tried to keep unions out. They have consistently lobbied against increasing the minimum wage and have proposed eliminating minimum wages for teenagers. Over the past 50 years, these policies have enabled prices to remain low for fast food operations but have caused the industry’s chronically high employee turnover rate.

Initially, McDonald’ s and other fast food chains sought teenagers for the bulk of their workers. For most teenagers, it was their first job and they were willing to work for minimum wage. In return, the industry taught teenagers basic job skills, such as getting to work on time, obedience, and how to improve their personal hygiene. The postwar growth in the fast food industry coincided with baby boomers coming of age. It was enhanced further during the 1960s, when the industry broadened employment opportunities for women and minorities.

But even this enlarged pool began to shrink as the baby-boom generation passed out of its teenage years. The fast food industry then shift ed to nontraditional workers, such as the elderly, recent immigrants, and the handicapped. Because little training is required for most fast food functions, this has worked out well.
In the United States, wages are set by fast food managers based upon local labor conditions, but the vast majority of employees have marginal social status, receive minimum wage, and do not receive benefits. Most are part-time workers and few are permitted to work overtime. Fast food chains reward managers who keep labor costs low. Taco Bell managers, for instance, have been paid bonuses based on the reduction of labor costs. This has sometimes led to abuse, such as employees being required to work off the clock so they would not be paid overtime rates.

Companies have responded to these issues by proclaiming that the fast food jobs are ideal first jobs and that they are perfect for anyone who wants just part-time work. Companies also point to the fact that they hire the elderly, the newly arrived immigrants, and the handicapped.
Th e exception has been the labor policies of In-N-Out Burger , a small, regional hamburger chain in California, Nevada, and Arizona. It pays its employees signifi cantly more than mandated minimum wages and off ers workers a benefi ts package that includes dental, medical, vision, and life insurance. As a result, In-N-Out enjoys lower employee turnover than do other fast food chains.

The infl uence of fast food employment on the nation is clear: McDonald’s alone hires one million new workers every year, more than any other American business, and one in every eight Americans has worked at McDonald’s at some point in their lives.