I read this article today. Here is my question: Top executives are continuing to be paid more and front line employees continuing to be paid less. Isnt the industry trying to say that front line employees do not create any value? What do you think?
http://online.wsj.com/article/AP6781705cdc684dd3a29ed189c6980d35.html?KEYWORDS=restaurant
Companies would not be able to function on a day to day basis without front line employees, so these employees should be seen as assets to the company and should be compensated accordingly.It is hard to say that all front line employees should receive higher wages when companies are struggling to pay the current wages. Even if a company can not afford a high pay raise for these employees, they should work on providing a more consistent schedule for front of the line employees. Many employees work at multiple fast food chains because of uncertainty about which hours they will be scheduled for and they need to ensure they make enough money to live. . That being said however, there is very high turnover rate among these employees. Top executive positions are a lot more stable and are being paid more and more each year to perform high level jobs.
ReplyDeleteI completely agree with you - line workers are important and a set schedule may be the solution!
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ReplyDeleteI agree with the articles on most of the points, although I do not think raising wages of line level employees will make a significant difference. You can see evidence for this in the recent 'Papa John's' issue. After talks about Obamacare, The higher level management at Papa's John threatened to lower the wages of their employees to compensate. You mentioned that companies would not be able to function without front line employees and that is very true, although I do not think increasing their wages will make a significant difference because corporations will find an alternate way to regain their lost money (ex. decreasing benefits, etc.)
ReplyDeleteI understand companies cannot raise salaries for all of their line workers AND keep low prices on fast food, which is the whole person of fast food. They also typically employ a ton of line workers. However, the could be treated better than most fast food restaurants do. They could give them set hours (at least the one's who want a more settled life) Remembering being a line worker, it is a job most people hate to go to. However, if they were treated with more respect and set schedules, there would be much less turnover. In my opinion, raising their salaries will cause a raise in inflation which will defeat the purpose. I feel it is something people have to accept, as the blog says, a "McJob" is not something everyone dreams of but there are people out there who will do it.
ReplyDeleteThis article reiterates many key negatives about the fast food industry. I think that as time goes on, this industry has become more and more outdated. Besides for the fact that fast food corporations contribute to America's obesity epidemic, workers are treated badly and not compensated fairly for their work. These front-line employees deserve proper schedules and proper raises. If workers are respected, they would be less likely to quit and contribute to the massive turnover in fast food. The main problem is that this industry has always been run this way and no company or CEO wants to be the one to set the example. If industry leaders joined forces to increase prices, turnover would decrease and revenue would ultimately be higher. I think it is time for an executive to take control of this industry before the entire business model crashes.
ReplyDeleteThe problem is with such low margins, there is no real solution to the low pay line employees earn. The fact is they are easily replaceable. When one employee leaves there are dozens more ready to be hired. If wages are all raised then the companies must find a way to get back that money, most likely coming out of our own pockets in higher prices on menu items. Inflation plays a big role here.
ReplyDeleteHonestly, I do not agree that they are saying that front line workers are of no value/do not create value, but I can see why it could be implied. The problem with this, like the article says, comes down to the consumers themselves. The CEO and upper management worked long and hard to get where they are. So if you paid each worker the 15 dollars an hour they want, which would be billions since there are so many McDonalds, then the CEO would be making little money, if any, and all fast food would be out of business immediately. I feel bad for the workers making minimum wage, because I have been there, but that is what you get when you are working in a low skilled industry. They aren't being undervalued.
ReplyDeleteI do not get from this article the idea that our industry is specifically saying that front line employees do not create value. I think that what this article is pointing out is that the wages of front line employees is dependent on many other factors and that all factors involved with running a business must be recognized. In order for a business to succeed and prosper, they must have what their customers want. In this case, the customers of fast food restaurants are generally looking for a quick, cheap meal. Thus, the franchisees and other top executives of fast food companies, make it their goal to please the customer by providing cheap food quickly. Also, running a business comes with many expenses aside from just labor. Some of these other expenses are constant and high or have the ability to increase at random. With that being said, labor cost is one thing that can be consistently controlled and changed at the discretion of the managers. Generally, as the article stated, this is the reason that wages of front line employees at fast food establishments remains hovering around minimum wage. After all other expenses and factors are considered, there is only so much money left for labor. From the employee side of the argument, maybe these fast food companies could try taking better care of their front line employees by spending more time training and trying to keep them at the job rather than having such high turnover. This would benefit the companies in more than one way. Mainly, it could possibly give the companies more leeway with labor cost, allowing them to increase wages of the front line employees. If this trend would carry on, the job of being a front line employee could potentially be looked at as a more stable option in the future, rather than the way it is viewed now. This stability of a job is what the front line workers are looking for and is what the top executives are getting paid for. Thus, this could end as a win win situation for all.
ReplyDeleteI think that the industry is trying to say that the front line employees are not crating as much value as they want. However, in reality they are the first people that customers see when they step into one of their stores. As well as being a huge part of the operations as a whole, these front line employees deserve a raise. I definitely do not think that almost doubling their wages would be smart because and the end of the day the owners need to make money. This is a big problem though because if they need to raise menu prices because of wage increases then the traffic that normally flows into their restaurants will significantly decrease which will not create jobs or value for the company.
ReplyDeleteRaising the wages of employees will decrease the industries margins and decrease revenue. People go to fast food restaurants for a cheap and quick meal. The executives will not give up their salary and it will be passed down to the customers, which results in a loss of revenue. I agree that living off of minimum wage is barely living at all, but the demand for jobs will keep the hourly wages low. They are expendable until more jobs are created.
ReplyDeleteI found the Wall Street Journal article very interesting. The salary of fast food workers has always been a concern, and an issue many hospitality managers face. I believe most managers’ value their workers they just don’t have the foundation to pay them more. Currently, the owners are only making .5 on every dollar. There just isn’t money to spare with how high food costs are. Although the article states the customers don’t want to pay more, I believe it’s the only way the employees are going to get the salary they deserve. The more the employees are paid, the more they are going to feel a part of the company and invest their future. It stated that Robert Wilson, an employee of a Chicago McDonalds, has only once received a .10 pay increase in the past four years. Although the profit margins are low these companies are still grossing billons in sales. A price increase in the menu may only make a slight percent of the customers avoid coming back. But it will sure help increase the employee morale. It is an investment the fast-food industry needs to make.
ReplyDeleteGreat comments so far... I agree, the industry definitely needs to get its act together, either by retooling ourselves, or in other ways. However, it is also true that these a low skilled jobs and therefore are being valued accordingly. But this dissatisfaction among the labor force will not simply go away. So what might we expect: higher wages and prices, and no change in quality? Then likely lower margins, reduced employment?
ReplyDeleteIt is wrong for quick service employees to receive minimum wage? Yes. But, how much more should they be paid? These are low skilled jobs, and it is very easy to have an employee replaced. The front line workers are the ones who are creating the revenue and doing the actual work, not the big head executives. In the first section of the article they had employees discuss their wages, but what about benefits? Working more than 40 hours a week must give you some kind of benefits and I think that has to be taken into consideration. When McDonald's is the biggest burger chain on the market right now with $27.6 billion in sales, I think they can at least put money into the franchises to help lower their expenses, that will eventually flow down to employment and help them receive bigger and better wages. It is a very delicate situation because either way prices for the consumer will go up, and that will not go very well.
ReplyDeleteFront line employees are key to running a business. They deserve compensation for the work they perform. I think paying someone $7.25 is low on the pay scale however, if someone wants better compensation all they have to do is move to a commercial restaurant and be a fry cook there. Almost any one is capable of working for a fast food chain. I think because employee turnover is fairly high, management keeps the wages low. Basically their will always be a pile of applications of people willing to work these positions regardless of the wage. However if there is so much money to be given to top executives, why doesn't more of it filter down to the line employees? Fast food chains should be concerned with training staff and employee benefits. I think one of the reasons I like my job so much is because of my employee benefits. Front line employees should receive more than minimum wage because they have direct contact with the customers. This staff needs to understand their value to the company and feel as though they are very appreciated. This staff has the ability to get guests to come back, even after an order mistake or that random long ticket time.
ReplyDeleteFront Line employees are crucial to creating value in a business. The industry is not responding to the fact that front line employees aren't important. It is responding to the fact that it can get away with paying front line employees less. With the economy not performing well, jobs are scarce and unskilled and uneducated people must take work where they can find it. If a firm can pay minimum wage and still fill all its front lime positions, thats what the firm will do, despite the fact that front line employees are more valuable than what they are being paid. Also, there is an abundance of teenagers who are willing to take a low paying front line position because they are not supporting themselves. Top executives can be pickier since they have a skill set that took at least a college education and experience in the field to hone. To keep these executives at a given firm, they must be paid more. Both executives and front line employees are valuable; the difference is that there are an abundance of front line employes, but only a small number of people able to fill the executive positions.
ReplyDeleteThe fast food industry raises many issues when it comes to wages, service, and quality. The front line workers are responsible for doing a lot of work for the business and are the first faces customers see. Unfortunately, they are not being paid as much as they like, or should be. Working in a fast food restaurant is considered a low skill job, but is still hard work. The problem with raising prices in order to compensate for higher wagers can seriously hurt the industry. Raising prices without increasing quality can turn away many customers and decrease revenue. The fast food industry is known for high turnover and poor treatment to employees. Companies and CEO’s need to start re-evaluating how they treat their employees, the amount of pay, and the amount of hours workers receive otherwise it will cause more issues then it already has and can have a very negative impact.
ReplyDeleteI feel that in order to keep prices low in fast food chains they can not raise the wages of line employees. I believe this is somewhat warranted because most customers do not come to fast food restaurants to have a great customer/employee experience but rather for the affordable food. Additionally I believe companies will be able to continue to keep front line workers wages low because there will always be the unemployed needing and looking for work. The difference that needs to be made by companies is the way they treat their line employees because they are a valuable asset to the company and the company would not prosper without them. If front line workers received more respect and benefits from the company I think we would begin to see more workers going above and beyond and turning a fast food experience into a more personalized one.
ReplyDeleteIn order to increase front line employee wages, fast food companies would have to increase the prices of food on the menu. Convenience and cheap food prices are what make these restaurants competitive in the fast food industry. I believe raising the prices would only generate a negative outcome. If employees are unhappy they are most likely to quit and find work elsewhere or even get a second job. I believe this article is demonstrating the constant battle many front line employees in the fast food industry face. Living off of minimum wage is rather difficult, but sometimes needed by all members of a family in order to put food on the table. Going forward, I think top executives should create an incentive plan for their loyal employees who continually invest time working for these companies year after year (possibly better hours or employee of the month recognition). After all without employees a business cannot operate.
ReplyDeleteI agree Melissa. It would be counterproductive to increase pricing in the quick service industry because that is what draws customers in. Increased prices would lead to less customers and then front of the line workers would no longer have a job. It is better to receive a small salary than none at all.
DeleteI think that because front line workers are the ones that are providing the first impression that the fast food restaurant has on the customer, that they should be paid higher wages. If I was working at a fast food restaurant and was being paid $7.25 an hour for years and years and have a pay increase of 10 cents only be a possibility over those years I would feel like the company did not value the work that I was doing for them. Front line workers are key in creating value and the company should do their best to make sure that the employee knows that they are valued. It is clear that companies like McDonalds are not having trouble making money or having trouble giving their CEO a pay package of 13.8 million dollars. So to give the franchisee the opportunity to give their employees higher wages, the companies should try and figure out a way to lower the fees that they bombard the franchisee with that makes it hard for them to have more money to give their employees. To some a position like this is only temporary but to many these front line jobs are all they can get and they need enough money to support their families and that is not possible on wages such as these.
ReplyDeleteI don’t agree front line employees do not create any value, but there are many factors that the company cannot raise the wage of front line employees. One of ways to raise their wage is to increase the price of products, but I do not think it is possible. The reason why people come to fast food chain is having meal for low price. Customers do not expect any fancy experience at Mc Donald or Burger King. As we know, it is difficult to have a high profit margin in a labor-intensive industry. Company may be able to pay more for front line employees, but it can be the reason that their profit margin has declined. There are also many differences between top executives and front line employees such as working hours and educational levels. I agree with Victoria as well. As she said, there will always be the unemployed needing and looking for work.
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ReplyDeleteI do not think that the lower pay for front line employees at fast food restaurants means that the companies are devaluing their work. I think the low food prices and the low national minimum wage are to blame for the low wages they receive. All companies are about the bottom line and if they can cut costs at the wage level because the national minimum wage is low, then why wouldn't you expect them too? In order to fix this issue, the government needs to raise the national wage limit and force the fast food executives to take cuts on their wages instead. Instead of taking a $13.8 million pay package, maybe CEOs should see the value of their front line employees and distribute that pay to the front line employees who deserve it.
ReplyDeleteI feel for the front line employees, because I do believe these employees need higher wages. Low minimum wages are nearly impossible to live off even as a full-time employee. However, I understand that the companies may face difficulties in raising the wages of the front-line employees. The problem really lies in that consumers expect cheap food from these companies. The majority of consumers are worried about a cheap, consistent meal and these large companies cater to just that. While the front-line employees play an incredibly valuable role in the restaurants, the company is in the business of selling cheap food. The greatest value that these restaurants offer their customers is consistent, inexpensive, and fast food. When considering that, it is easier to understand the the front-line employees are not adding much value to the guest experience. The front-line employees play a valuable role, yes, but do they add value to the experience? I am not sure. Clearly the operation would not exist without its front-line employees, but the supply of employees is very high. As the article points out, these front-line employees are often high school or college kids and there is very high turnover. When these employees leave, there is always another employee to fill their shoes. Although I wish there were a way to improve the front-line employee wages, I think the impact of their efforts will be far off.
ReplyDeleteFront line employees are the most important part of any successful business. However it is also a low skilled position, which has very high turnover. By raising minimum wage, most fast food chains would also need to increase the price of their food in order to compensate. This increase in price would not go over well with the consumer and could end up losing a lot of business. A way that businesses might be able to avoid these price increases is to reduce some of the franchise costs. Franchise costs add up to a lot of money that could be better put toward the front line employees. Franchises also should focus on making sure their employees have the hours that they need. This could help to reduce the need for employees to have multiple jobs to get the pay they desire. Whether it is benefits, compensation packages or pay increase, something should be done to help front line employees achieve a higher quality level of life. This is much easier said than done however as there is an abundance of front line employees, making them easy to replace.
ReplyDeleteIt is a sad reality that front line employees are not receiving more competitive hourly rate. All the same, that is the reality of the situation, even more so in the fast food chain. With technology advancement, the process of preparing food in fast-food chains like McDonald’s is simple and easily done with the push of a button. Each step has some form of machinery that does most of the work and assembling a burger or dropping a bag of fries in the deep fryer isn’t exactly rocket science. In fast food chains, standards are important to ensure that each burger that goes out has the same portion of meat, lettuce, tomato, pickles and cheese. Thus, an assembly line is formed in which you are not even required to make a burger all by yourself. You are assigned to a station; whether it is flipping patties, putting on lettuce, or wrapping the burger up, you just keep doing that same action with each order. You master the skill pretty quickly and if you don’t, you can just keep doing it until you remember it.
ReplyDeleteOf course we would all love to have a higher pay rate but the truth is the job doesn’t require much skills or knowledge. Practically anyone can do it. That’s why you are in college and that’s why you are working so hard to get a degree. Comparing a manager’s job of ensuring the business runs like a well-oiled machine to a fast-food worker’s job of serving food, we know that being a manager comes with so much more responsibilities. We can all say we support the people who are protesting, we can all sympathize with them, but I am sure none of us would picture ourselves working in a fast-food chain for the rest of our life. And for some of us, working in a fast-food chain is just another way to pay our bills, the thought of moving on to greener pasture upon graduation always in mind. This does not mean that working in a fast-food chain is beneath me, I have worked hard at my job and I know what it is like to be a front line employee. Not only do you have to worry about making ends meet, you often have to put up with nasty customers, conflicts that might arise between co-workers, and a ton of side work that no one ever seem to care about doing.
Another point mentioned in the article that I found interesting was the fact that the customers themselves want cheap affordable meals. So there is a possibility that the same people that wants a raise, the same people that support these protests, and the people who secretly support this in the back of their mind all desire cheaper quality food when they are in a pinch. Business owners are in the business to make a profit but with the rising food cost, there is only so much a manager can do before the expenses start to eat into their margins. They are caught in between satisfying customer needs and keeping their employees happy. Sure they can pay their employees more per hour, but are customers willing to feel the impact of higher menu prices?
One can argue that the service provided by these customer contact point personnel is very important as they are the face of the company and to a certain extent that is true. That is why when you dine at an upscale restaurant for a special occasion you are given the best service by the wait-staff. This is so because you are buying the dining experience when you leave a nice amount of gratuity at the bottom of your check (or not!). In contrast, at a fast-food restaurant, it is perceived as more of a self-service setting and people don’t see the service component as obviously. And this brings us back to the point of customers’ desire to get affordable fast food. If you ever feel that front line employees should receive a raise in their hourly rate, how about dropping them a tip the next time you go up to the counter to order a burger?
I don't think that the industry is trying to say that frontline employees don't have any value. But I do think that they are being paid the bare minimum because top executives are displaying greed by squeezing out high franchise fees to their franchised restaurants. For CEO Don Thompson to be paid $13.8 million in one year while Robert Wilson has seen an increase of ten cents to his paycheck in four years is a great example of greed. Top executives can get away with these high franchise fees because they know how easy it is to replace a worker at a fast food restaurant. If these executives would take a pay cut and lower their franchise fees, the franchisees might have more money to spend on labor and have more satisfied employees. That is why I think greed is the ultimate factor when it comes to this situation.
ReplyDeleteI don't believe that front line employees low wages reflect their value to the company. Without these employees, there wouldn't be a fast food industry at all. The unfortunate part is that it is one of the most replaceable jobs in the world, where replacements wiling to accept minimum wage are easily found. The article points out that wages are just one piece of the puzzle. If wages were to increase, there is a strong possibility that prices would also increase which in short will create unsatisfied customers and less business. I think that is a very important aspect that many people are overlooking. If the demand for jobs is going to continue to support minimum wage jobs, why would the industry take the chance of losing massive amounts of revenue when their not in jeopardy of losing anything at all? Although, I do believe employees should receive benefits or raises, depending on their hard work and duration of employment. If a front-line employee is dedicated to their job, they should be rewarded to show they are an asset to the company. But starting every one at a higher salary is a big movement that's not easily done and could be quickly regrettable. The fast food industry has employees ranging from a young high school student working part-time to full-time adults who consider this their career, but whose to say they all deserve a higher wage?
ReplyDeleteI do not believe that industry is trying to say that front line employees do not create value. Companies such as McDonalds just simply do not have the money to be paying their employees $15 an hour with their current prices on their food. Like the article said, McDonalds would have to raise their food prices, which would definitely slow down sales. I believe that the minimum wage should be raised so that front line employees can be more satisfied with their earnings. They would be more happier and better performance in the work place.
ReplyDeleteI do not think anyone is saying that frontline employees do not create value. I have worked as a frontline employee before and I know how much work we do. My managers have never made me feel as though my job is insignificant. The issue with raising employees wages is that a typical restaurant has about 130 employees however that restaurant only has about one or two managers. The frontline employees also never understand how much more work a manager does so they do not understand why a manager deserves more pay than themselves. Also,it would be difficult to raise everybody wages. It takes a lot of money and resources to run an establishment and trying to please over 100 workers and give them more money would just be too much. I think managers/owners could give their employees something extra instead of a higher wage. For example, benefits or special prizes/bonuses once in a while. The last point I want to make is that if a worker has been at a company for several years, they deserve compensation. I think the fact that that man was at McDonald's for 7 years and only received 10 cents a year raise, is unacceptable.
ReplyDeleteI think this issue all stems down to the CEO's- the head leaders of these huge billion dollar industries. The one line of this article that got me was when it said that McDonald's recorded a profit of $5.5 billion last year on $27.6 billion in sales, while the CEO Don Thompson got paid $13.8 million that year. That's where all the money is going! These fast food companies need to keep the prices low, or else the customers won't come. There is no other place they can cut costs except taking it from the executives. Not that this will realistically happen, but it is a solution that will keep the front of the line workers happy, since they are what make these businesses operate on a day to day basis.
ReplyDeleteI think that a major thing that would need to change to fix the lack of the money in the fast food industry for line employees, is the view of the consumers. Consumers need to understand that the fast food industry has extremely low margins which leads to much less pay than most employees deserve. To get more money for the lower line employees consumers need to pay more for the services at a fast food restaurant. In the future if the fast food industry slowly got away from such fast service and centered the attention on the quality of the food and more pay for employees. Companies that are fast casual have prospered in the last couple years such as Panera and Chipotle. That makes me believe that the average american consumer is willing to wait maybe seven minutes for quality food at a slightly higher price. the higher prices could be used to improve the pay of lower line employees if the company owners disbursed the profits properly.
ReplyDeleteI don't believe that the industry is saying that the front-line employes don't create any value for the company because without good front-line employees the industries know that their company would not be able to run smoothly. However, I do believe the industry is saying that their front-line employees are replaceable if they start to demand a pay increase. Although, after reading this article I do understand why employees think they should receive a higher pay. The reason for this is that the top five fast food chains make, together, 16 cents of profit on every dollar of revenue, which is 73% more then the average company in the United States. This is still an unrealistic reason to raise pay ,however, because this means that the fast food chains would have to raise prices. With the quality of food these restaurants put out customers would not be willing to pay which would still end up in loss of profits either way.
ReplyDeleteI feel that frontline employees deserve a higher pay rate because they are the face of the franchise. However, I understand from a business perspective that it is difficult to pay these employees much above minimum wage and it is nearly impossible to pay them the $15 per hour that they are requesting. Since many franchisees only get a profit of nearly 5%, it would be difficult for them to increase wages while still making a profit.
ReplyDeleteI do not think that the industry is trying to say that the front-line employees do not create any value. I think that they are stuck in a place where they can't continue to sell food at the same low price while paying employees more. If they do that, they could find themselves losing a lot of money.
ReplyDeleteCustomers would likely be unwilling to pay more for their fast food, so raising prices would not work. I understand why employees want more money. It can be difficult to afford to live, especially with the uncertain hours. I am not sure how easy it would be for a fast food restaurant to make sure that their front-line employees are able to have steady hours. The amount that they can pay employees depends on how much they are selling at that moment.
In my opinion, the fast food industry owes their front line employees more than what they give. I believe the frontline employees are the face of each of these companies. They are the ones who interact with the guests, serve the food, and in some situations, make these companies what they are today. CEOs in these companies wouldnt have made it to where they are today if it wasnt for the frontline employees. If they raise the prices in the fast food industry, the amount of people will decrease. The main reason people come to these fast food chains is because of the price and super fast service. The only way to cut costs would be of the CEOs. Lastly, I also believe it would be difficult to increase wages and make a profit.
ReplyDeleteSome of these front line employees make a 'living' and are attempting to raise a family based on this minimum wage pay - the executives a huge amount of money off the backs of these workers. I think it is the duty of the industry to recognize and incentivize these lower-level employees for their value and to retain them. After all, they are what make the day-to-day functions of these fast food joints make the billions of dollars that they do. Paying minimum wages to these workers expresses a lack of appreciation for the front-line workers in this industy - and this is a problem. I think a proper wage would be around $9.00, as opposed to the $7.25 standard offer; I think that if someone chooses this career path, they should understand what that entails and that in order to stay in business, large franchises can only afford to pay its labor so much. That being said, to instill a sense of value in its employees, executives should explain what they are and are not able to pay their employees, and reward them in other ways - after all, like I said, they are the ones to execute day-to-day functions. But the skill level being so low, if someone doesn't want to work for a low wage, someone ELSE will.
ReplyDelete-LIS WERT
From the article I understand the really low wage employees for these food chains have, along with a huge uncertainty of the size of the next paycheck they will get due to the availability of working hours. On the other side these companies work on really small margins and they have to take care of their bottom lines. The thing regarding how much value these front line employees give to the restaurants its the more difficult part to asses since these jobs require basic to none skills. I think that eventually CEO's will have to address this issue since the talks has become more prominent about how big is the gap between "rich and poor" since the Great Recession. I personally think that an increase in the Federal minimum wage is necessary to force the fast food chains to increase the condition of living of their employees and making the customers absorb some of the increase in costs that this measure would bring.
ReplyDeleteIn order for companies to see if employees are creating value, they will need to measure it somehow. However, I do not believe their value worth is measured by how much their wage is. The concept of low-skilled jobs deserve lower wages does not imply that the front-line employees do not create value. Front-line employees interact with the customers the most, and therefore are the core of the business. Employers can measure their productivity and see just how much value they create for the bottom line.
ReplyDeleteI do not think that is necessarily what they are saying. I believe they are just saying that there are many more factors that go into a pay raise. If they spend money here they lose it somewhere else. Like the article said if they spend more money on wages that could drive up the cost of their meals which could drive customers away. I do agree however that they should consider higher wages but they need to look at all aspects. The front line employees are the ones that run the day to day operations and truly keep the companies going and that cannot be ignored.
ReplyDeleteafter i read the article, i felt that not only me but also other students felt the same way as i am,since we have experienceă…‡ work as front line but not top executive. to tell the truth, i think top executive make more value than front line since their name or fame paid more but i think value is starting origin from the front line. because front line more contact with customers and actual business starts from the front line. some people think creating value is relates to wage, but i think even if increase wages does not imply creating more value.
ReplyDeleteI have to say I disagree with you when It comes to top executives creating more value than the front line employees. Sure the executives make the big decisions and oversee a lot of people, but in any business, how many of the top executives spend much time in their store? The people who make a difference as to whether or not people have a good experience at a restaurant or hotel, and whether or not they will return, is largely dependent on the front line employees. Thus, are they not the ones responsible for creating value?
DeleteAfter reading this article I don't exactly feel as though it is saying that the front line employee do not create value for the company. I think with all of the research that McDonalds does with their company to make it the best that it can be, they know that the front line employees are the face of their company when customers walk in the door. Although it would be great if the company was able to raise employee wages, I don't feel as though the employees are looking at the company as a whole. It is so much larger than just the one standing franchise that they particularly work at. If they raise wages for one they have to raise wages for all, and with McDonalds and large franchises in the fast food industries that is a lot of employees involved around the world, which means a lot of money. They are working with margins so small that although it sounds great in theory, and I think it would be awesome if they were able to do it, I don't know if it is possible without raising prices for customers.
ReplyDeleteThis article made it real evident that the front line employees are completely overlooked by the head executives of these corporations. Countless kids work at least one minimum job in their lives and eventually move on. But, for others it is what they depend on to survive. And doing that on minimum wage in today's times is nearly impossible. If a front line worker were to put in 40 hour weeks at $7.25 for a whole year they would only make $15,000. This number is just simply too small for one to have a decent living. In the article Robert Wilson particularly caught my eye. He is a 25 years old and has been a McDonald's employee for 7 years. He earned a 10 cent raise over the past 4 years and now makes $8.60. I do understand though that it is a low skill position with an extremely high turnover rate. In order to increase the pay for these workers the price of the food and drinks must also go up. This though would take away all of the glory of fast food restaurants. People go to these places for a quick, cheap, tasty meal. Raising the prices would definitely deter a large amount of customers. That is where it gets very tricky when it comes to solving this problem of wages and food costs. One possibility would be franchise owners lowering one of the multiple fees placed on the franchisee. This could possibly wiggle up some room over time to potentially make an effort in getting front line workers wages raised. Raising wages would go along way with front line workers increasing loyalty and decreasing turnover.
ReplyDeleteI totally agree with you. How is it possible that someone that has been working at a company for 7 years has not get a bigger raise then 10 cents. Why would this franchisee not work on decreasing their turnover? This can save them a lot of money.
DeleteSigrid Roest
I would say a large portion of value created by a company is done by the front line employees. These employees are the ones that make the company what it is, they wait on customers and collect each dollar for the burgers and tacos they sell. These companies are not made on acquisitions of other companies, they are made on selling a cheap food product. The cheapness of their products is what some say is the only thing keeping them alive. But raising the federal minimum wage will bring ALL employees to a new higher pay amount. All items would be higher, but doing it gradually will allow employees to work their way up and consumers to not have to feel the higher prices as such as shock. But now that I have left the main question I will circle back, I do believe the low wages paid to industry employees is a reflection of their perceived value creation ability. The CEOs of these fast food company are professional CEOs, if these CEOs started as front line employees being the low man of the totem pole, I believe wages paid would be different.
ReplyDeleteAfter reading this article I think that front line employees are completely ignored or overlooked. Front line employees have as much value as back line employees. Without their service the name and fame of the company would not really exist. I am a front line worked myself. I work as a waitress at the nittany lion in and our manager is constantly telling us how we represent the NLI and how much we need to keep our customer ratings high. If something goes wrong we usually take the heat for it. With the deals to being paid, I do as well think it is way to little in other countries it is a career and not just a pick up job. People may complain that fast food is so cheap that there is no need to give the employees more money because of how "easy" of a job it is. That it isn't intensive labor. I just feel that it should be about everyone not just the CEOs.
ReplyDeleteI personally believe not all front line employees should get a raise, but employees with out-standing performance and customer service should get bigger pay checks. Getting a raise can encourage front line employees work harder and more efficient. At the same time front line employees represent the appearance of the restaurants. Companies should spend more money on training and compensating these employees in exchange of their better performance and friendly customer service. I think good front line employees can make dining experiences more enjoyable. These employees are much more important than what they get paid for.
ReplyDeleteI believe this article brings to light a serious issue in the fast-food service industry. In a business where corporate executives make massive bonuses from a wide range of stores spread across the country, employees and even franchisees are left trying to figure out how to make ends meet while working for a successful company. This story did an excellent job of showing how even franchisees are discouraged from providing raises. Since the franchisee is pinching pennies just to pay rent, utilities, and food costs, they are left little, to no room to pay their employees a living wage. I believe it is becoming obvious that, in many areas of this country, minimum wage can no longer be considered a "living wage" at 40 hours/week. I believe I am repeating a sentiment that many of my fellow students agree with, but it's time for fast food executives to make adjustments to help their employees. I find it shocking that these executives can request millions of dollars in bonuses every year, while their bottom level employees are struggling to make ends meet.
ReplyDeleteWould Ray Kroc be happy with his front line employees suffering while the executives raked in unconscionable sums of money? In my opinion, I highly doubt it.
This is interesting because fast food has never been put in the spotlight that it is being put in for labor before. If anything if has been said to have the lowest paying jobs and where all the teenagers work. Honestly I think that is a good thing, I feel fast food is a good start out job. It gets you in the work force, and is also easy. I believe people are protesting simply because, who doesn't want to get paid more? What's the easiest target? Work with the cheapest pay, work that always seems to have a "bad reputation." With top executives being paid more, I don't think it truly reflects on the front line employees. A fast food job, as said in the article, is "meant"to be a job held until you find a more demanding (whether in skill or a growing field)job that you will choose for a career.
ReplyDeleteI definitely agree with all of this because the fact of the matter is that it is a very low skill job and to get paid more money there needs to be more responsibility in the job.
DeleteI agree with my fellow colleagues about raising the food cost in order to raised employee pay. This would be a great incentive to motivate the employee for beter service. However there is a down side to this, it is known that many employess return to their old habbits after recieving the raise. When it comes down to the 'tip' employees, i feel like the gratuity should not be removed because for some, it can come down to those extra couple dollars the employee could of earned. 'Tip' employee work their buts off to ensure a good service, if anything they should raised the 'tip' employee wages because not everyone is going to add on another tip when they see they have been charged a gratuity. So overall i believe the business needs to find a way to satisfy their employees because if not, they will find a company who will.
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