1851

As the <a href="https://en.wikipedia.org/wiki/List_of_largest_employers?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">fourth largest employer</a> in the entire world, <a href="https://www.mcdonalds.com/us/en-us/about-us/franchising/acquiring-franchising.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">McDonald's</a> has always been a significant part of the <a href="https://1851franchise.com/five-things-franchisees-need-to-know-about-minimum-wage-requirements-4747">wage conversation</a>. Now, as tensions heat up due to the COVID-19 pandemic and a <a href="https://1851franchise.com/dennys-is-the-latest-brand-to-suffer-from-growing-labor-shortage-2715676">major labor shortage</a> in the restaurant industry, McDonald’s is continuing to impact the trajectory of the country’s minimum wage.<h4>How McDonald’s Position Has Changed Over the Past Year</h4>In 2019, McDonald’s <a href="https://1851franchise.com/mcdonald-s-will-no-longer-lobby-against-raising-minimum-wage-2709545">announced</a> it would no longer lobby against a federal minimum wage. Since then, the corporate team has remained somewhat neutral on the subject.&nbsp;In January, for example, McDonald's CEO <a href="https://en.wikipedia.org/wiki/Chris_Kempczinski?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Chris Kempczinski</a> <a href="https://www.fool.com/earnings/call-transcripts/2021/01/28/mcdonalds-corp-mcd-q4-2020-earnings-call-transcrip/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">said</a> the legacy burger franchise was doing "just fine" in the <a href="https://www.thebalancecareers.com/2018-19-federal-state-minimum-wage-rates-2061043?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742#:~:text=Data%20from%20the%20Economic%20Policy%20Institute%20indicates%20that,Dakota%2C%20Vermont%2C%20Washington%2C%20Washington%20D.C.%2C%20and%20West%20Virginia." target="_blank" rel="nofollow">29 states</a> that have already increased minimum wage rates beyond the federal level of $7.25. This comment came in response to the reintroduction of the <a href="https://www.congress.gov/bill/116th-congress/house-bill/582?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Raise the Wage Act</a>, which seeks to raise the minimum wage to $15 an hour.&nbsp;Kempczinski's comments also came after <a href="https://www.marketwatch.com/story/what-minimum-wage-increases-did-to-mcdonalds-restaurants-and-their-employees-11611862080?mod=hp_minor_pos21&amp%3Badobe_mc=MCMID%3D89603281908163757490338208712198153091%7CMCORGID%3DCB68E4BA55144CAA0A4C98A5%2540AdobeOrg%7CTS%3D1611863651&utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">a four-year analysis</a> by a team of economists who found “higher McDonald's wages in applicable markets have not led to closures, job loss or increased automation.”&nbsp;Despite these comments, McDonald’s is still part of the National Restaurant Association and the International Franchise Association, both of which lobby against a raised federal minimum wage.<h4>Why McDonald’s Is Different Than Other QSR Chains</h4>During its <a href="https://www.fool.com/earnings/call-transcripts/2021/04/29/mcdonalds-corp-mcd-q1-2021-earnings-call-transcrip/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Q1 earnings call</a> on April 29, McDonald's USA President <a href="https://www.mcdonalds.com/us/en-us/about-us/leadership-team/joe-erlinger.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Joe Erlinger</a> said the company is looking into evaluating the wage minimum at company-owned restaurants. But since McDonald's is <a href="https://corporate.mcdonalds.com/corpmcd/franchising-overview.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">about 93% franchised</a>, most labor decisions are decided by independent owners, which creates an added layer of complexity when it comes to implementing a $15 minimum wage systemwide.&nbsp;For example, franchisees' ability to raise their minimum wage may depend on whether or not they can increase menu prices. In Canada, which raised its average minimum wage by <a href="https://www.monster.ca/career-advice/article/minimum-wages-across-canada-2019-2020?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">nearly 11% from 2017 to late 2019</a>, Kempczinski said that McDonald’s franchisees found success by passing those costs over onto the menu.Most of the chains that have committed to a systemwide $15 wage recently, including <a href="https://www.businessinsider.com/starbucks-plans-for-15-minimum-wage-across-us-stores-2020-12?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Starbucks</a> and <a href="https://www.prnewswire.com/news-releases/chipotle-increases-wages-resulting-in-15-per-hour-average-wage-and-provides-path-to-six-figure-compensation-in-3-years-301287326.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">Chipotle</a>, are 100% company-owned.&nbsp;<h4>Why Employees Have Had Enough</h4>Now, it appears McDonald’s employees are tired of waiting, with employees in 15 cities planning to strike on May 19, a day before the company's annual shareholder meeting, <a href="https://www.vice.com/en/article/k7885a/mcdonalds-workers-will-strike-for-dollar15-an-hour-in-15-cities?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">according to Vice</a>.&nbsp;This strike comes as a culmination to a year fraught with employee complaints. Since McDonald’s workers have been deemed essential and put at <a href="https://1851franchise.com/small-businesses-bash-politicians-after-states-lift-covid-19-restrictions-2715180">high risk</a> for contracting COVID-19, <a href="https://www.usatoday.com/story/money/business/2020/05/19/coronavirus-mcdonalds-employees-national-strike-over-safety/5218729002/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">several strikes</a> have been held throughout the past year demanding higher wages.&nbsp;"Our first responsibility is to our hardworking restaurant crew, and we respect and appreciate their dedication to serve millions of customers daily,” McDonald’s said in an emailed statement to 1851 Franchise. “It's the responsibility of federal and local governments to set minimum wage, and we're open to dialogue so that any changes meet the needs of thousands of hardworking restaurant employees as the 2,000 McDonald's independent owners/operators who run small businesses."<h4>How the Labor Shortage Could Impact the Minimum Wage</h4>The strike also comes as the restaurant industry faces a massive labor shortage. McDonald's is <a href="https://1851franchise.com/7-eleven-franchisees-ask-for-relief-from-overnight-operating-hours-amidst-worker-shortage-2715662">one of several chains</a> struggling to hire enough workers to keep with the pent-up consumer demand.&nbsp;According to a <a href="https://onefairwage.site/wp-content/uploads/2021/05/OFW_WageShortage_F.pdf?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">One Fair Wage report</a> released last week, the top reason restaurant workers are leaving their jobs is due to low wages and tips. While raising the minimum wage could theoretically incentivize these employees to return to work, many restaurant operators argue they can’t afford to increase labor costs right now. The <a href="https://www.restaurantdive.com/news/nra-why-we-oppose-the-raise-the-wage-act/594661/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation-2715742" target="_blank" rel="nofollow">NRA wrote</a> that the Raise the Wage Act was "the wrong proposal at the wrong time for the restaurant industry."With such a massive presence in the restaurant industry, McDonald’s response to the upcoming strike and minimum wage decisions moving forward could significantly alter the bigger conversation and impact how other brands operate.

How McDonald’s Has Continued To Play an Important Role in the Franchise Industry’s Wage Conversation 

1851 Franchise

As restaurant brands struggle to find workers, McDonald's employees in 15 cities are planning to strike in demand of a higher minimum wage.

how-mcdonalds-has-continued-to-play-an-important-role-in-the-franchise-industrys-wage-conversation

ServiceMaster Restore

ServiceMaster Restore - Disaster Response - 1851 Franchise

When Disaster Strikes, ServiceMaster Restore Moves

servicemaster-restore-disaster-response-carmen-coleman

Children's Lighthouse

How Children’s Lighthouse Stands Out Among Other Children’s Education, Childcare, and Daycare Franchises

how-childrens-lighthouse-stands-out-among-other-childrens-education-childcare-and-daycare-franchises

The Growth Coach

The Growth Coach Franchise Costs, Fees, Profit and Data for 2025

the-growth-coach-franchise-costs-fees-profit-and-data-for-2025

One Hour Heating and Air Conditioning

Why One Hour Heating & Air Conditioning Sees People as the Power Behind Franchise Growth

one-hour-heating-air-conditioning-franchise-growth

Lawn Doctor

Design with photo of John Perry and Lawn Doctor logo

How a 20-Year Industry Veteran Tripled His Sales With a Lawn Doctor Franchise

lawn-doctor-franchise-success-story-john-perry

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

Design with American and Federal Reserve flags against light blue background

Federal Reserve Expected To Cut Rates by Quarter Point, a Move That Could Boost Franchise Growth

fed-rate-cut-boosts-franchise-growth

Potbelly to be Acquired by RaceTrac in $566 Million Deal 

racetrac-acquires-potbelly-in-566-million-deal

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities - 1851 Franchise Agg

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities 

health-care-hiring-slowdown-in-home-care-franchise-opportunities

Caribou Coffee Names Scott Kennedy CEO, Eyes Continued Growth

caribou-coffee-names-scott-kennedy-ceo-eyes-continued-growth

McDonald’s Launches New Extra Value Meals as Consumer Demand for Value Continues to Climb

mcdonalds-launches-extra-value-meals

Technomic Releases Annual Ranking of the Top 15 Fast-Food Chains in the U.S.

technomic-releases-annual-ranking-of-the-top-15-fast-food-chains-in-the-us

Power Eats: Smoothie King Rolls Out Food Nationwide To Fuel Franchise Growth

smoothie-king-food-menu-power-eats

Hely and Hiral Patel Bring Their Longtime Dream to Life With The Brass Tap

brass-tap-franchise-pasadena-maryland-hely-hiral-patel

1851 Keyword - The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

part-time-franchises-picking-the-right-model

Franchisee spotlight graphic with photo of Ricki Oberoi and Layne's Chicken Fingers logo

How McDonald’s Has Continued To Play an Important Role in the Franchise Industry’s Wage Conversation

MORE STORIES LIKE THIS