Should McDonald’s raise prices so it can pay higher wages?
It is fashionable today for people to shame fast food chains for not paying their employees more. One way I hear this argument put amounts to the following: Why can’t these restaurants raise wages and then pay for them by raising prices?
Fast food restaurants are businesses, not welfare offices. They exist to make money by providing convenient meals at affordable prices. Every job they create is designed to make money: their continued success depends on offering pay that keeps costs low while still attracting employees who are willing and able to do the work needed.
Some of those who want to see McDonald’s et al. simultaneously raise wages and prices insinuate that this would not have any noticeable impact on profits, but there is no way that this is true. If the company could raise prices and wages without losing profits, then why doesn’t the company just hike its prices without raising wages to boost profits?
To maintain and grow a popular fast food chain like McDonald’s requires relentlessly striving to offer better deals, introducing new items to keep the menu interesting, keeping customers well informed of your items through catchy marketing campaigns, amongst many other things. Those who want McDonald’s to turn inside out to find ways to pay employees more money, not because it makes business sense, but because the employees “need” the money, want the company to focus less on prospering and more on carrying burdens.