Chipotle Raises Minimum Wage to $15 Ahead of 20,000-Job Hiring Surge

Chipotle, the quick-service Mexican restaurant with over 2,500 locations nationwide, announced Monday it is raising its minimum wage to $15 up from its current baseline of $13. The raise will occur gradually over the next few weeks and be fully implemented by the end of June, according to a press release from the brand.

The wage hike is part of Chipotle’s strategy to attract 20,000 employees to staff the 200 new locations it plans to open in 2021. On top of the wage hike, Chipotle also announced a $200 employee referral bonus for hourly workers and $750 referral bonus for general managers.

"We're looking for people who are authentic, passionate and want to help cultivate a better world through real food and real personal development,” said Marissa Andrada, Chipotle’s chief diversity, inclusion and people officer, in the announcement. "Chipotle is committed to providing industry-leading benefits and accelerated growth opportunities, and we hope to attract even more talent by showcasing the potential income that can be achieved in a few short years.”

Chipotle is also advertising that employees can advance to the highest general manager position in under four years, earning an average of $100,000 in yearly salary.

This announcement comes as the foodservice industry struggles to hire enough workers to meet the growing demand of fast-casual and quick-service restaurants. Unemployment benefits and government subsidies are thought to be largely to blame for the worker shortage. Black Box Intelligence recently surveyed 360 restaurant operators, and 57% replied that higher pay through unemployment is the main reason behind the industry’s labor shortage. 

However, it appears that it’s not just the unemployment benefits that are keeping applicants away. The lower wages of the restaurant industry combined with lack of professional development and low quality of life are also to blame, according to the Black Box survey.

One Fair Wage and UC Berkeley Food Labor Research Center released a report that said low wages and tips were the most popular reason for employees leaving the restaurant industry. 78% of respondents said having a full, stable and livable wage would make them consider staying at their job.

The food service industry is aching for more employees to keep up with demand. KFC is looking to fill 20,000 positions, Taco Bell is hoping to hire 5,000, IHOP is looking to hire 10,000 and McDonald’s over 25,000.

A higher starting wage is likely to make Chipotle more attractive to potential candidates, but there is concern in the industry over the precedence the move will establish. Neema Ardebili, vice president of Global Franchise & Strategic Partnerships at ADP, said in an interview with QSR Magazine, “Seven out of 10 restaurants are single-unit operators and nine out of 10 have a staff size under 50. Many restaurants, both large and small, cannot afford to pay, let’s say, $15 an hour or provide bonuses to all workers as those increased payroll expenses will severely impact their margins, especially in light of revenue pressure.”

Nevertheless, employers are having to do more to attract high-quality candidates than rely on wages, which is forcing franchises and restaurant owners to change. 

“Owners definitely need to reevaluate,” said Ardebili. “We initially thought restaurant workers and those in similar jobs simply don’t want to work in closed, high-engagement environments. However, what we’re seeing is candidates are more selective in where they want to work due to the cushion of receiving unemployment and alternative industries offering better work-life environments and attractive benefits.”

In addition to Chipotle’s minimum wage hike and path to a general manager position, the brand highlights employee benefits such as performance bonuses, debt-free education, mental healthcare and 401(k) plans in its announcement.

To fill its upcoming openings, Chipotle is holding a virtual career fair on Discord (the first company to do so) from 10am to 1pm PST on Thursday, May 13th. Candidates can talk to current Chipotle employees in real-time, ask questions and even attend cooking demonstrations.