Wendy's Is Replacing its Human Workers With Kiosks Because of Minimum Wage
Robots are coming for our jobs and they're starting with fast food restaurants. Wendy's is replacing cashiers with touch-screen kiosks where patrons can order food and pay, according to Chicago television station WFLD. The shift away from human workers come amid calls for a raise in minimum wage.
One worker at a Chicago Wendy's told WFLD she was told the move would eliminate five jobs from the location. The company has more than 6,500 locations worldwide.
The growing bot workforce comes as labor unions and workers campaign for a raise in the minimum wage. Chicago has passed and has begun implementing a wage hike. Workers in Chicago now make a minimum of $10 an hour, up from $8.25 an hour. The city plans to grow its baseline wage to $13 per hour by 2019. California, New York and the District of Columbia have also agreed to raise pay, according to the Wall Street Journal, and other states are following suit.
Wendy's is not the only fast food restaurant to make the transition from man to machine. White Castle has been testing order and check out kiosks for the last two years. Meanwhile, McDonald's kicked off a machine-ordering pilot this year that allows customers at two Chicago locations order coffee drinks from a touch screen.
The Employment Policies Institute reports wage hikes lead to jobs losses. "When labor costs go up, business owners can do one of three things: raise prices, cut costs or shrink their profit margins," wrote Michael Saltsman, a research fellow at EPI, wrote in an op-ed. "Given the consumer's insatiable demand for ever-lower prices, and the fact that most minimum wage employers operate with a profit margin of 2 to 5%, the only realistic option is to cut costs. One of the key ways to cut costs is to introduce automation or self-service,"
But as University of Oregon economist Tim Duy said in an interview with the Huffington Post, automation may be taking over regardless of the minimum wage. "Consider the issue of fast food employment," he said. "Some of those jobs, in particular the cashier, are almost about to be automated away regardless of what happens to minimum wages."
To his point, lots of jobs have already been automated without the pressure of increased wages, like bank telling and certain factory jobs. Regardless of the catalyst for this rising tide of automaion, the result may be a shrinking number of low-skill paying jobs for Americans.