Half Of Frontline Fast-Food Workers Rely On Public Assistance, Study Says
Taxpayers pick up a $7 billion tab each year for workers, study finds.
Roughly a year and a half ago, 29-year old Carmam Iverson entered the workforce after having spent her 20's as a stay-at-home mother for her four children. She has yet to complete high school, but would one day like to finish school so she can work as a pharmacy technician. In the interim, Iverson (pictured above) was able to land a crew job with McDonald's in Kansas City, Mo., working as a cashier and prepping food. She makes $7.35 an hour, putting in an average of 27 hours a week. As a part-time worker, she gets no benefits from McDonald's.
An so Iverson must rely on public assistance. She currently makes use of food stamps and is on the waiting list for section 8 public housing. She recently moved out of her house and moved in with her sister. (Her children and their father live with his mother.)
In speaking to AOL Jobs, she explained her struggle with meeting even the most basic needs. "I always have to pick between something -- pick between which meal I can eat, or pick between paying for housing needs or food," she said.
Needing public assistance
Iverson is hardly alone. In fact, more than half (52 percent) of front-line fast-food workers must rely on public assistance programs to help their families get by, according to a study released Tuesday by the University of California, Berkeley. The data was culled from information provided by the U.S. Census Bureau. The workers' average salary of roughly $8 to $9 an hour is not enough to prevent them from relying on food stamps, public housing or other forms of assistance. And so as a consequence taxpayers end up paying nearly $7 billion a year to fund the programming, the report found. Comparatively, the fast food sector generates sales of $200 billion a year. And crucially the largest publicly traded fast food companies walked away with $7.4 billion in profits last year.
A companion report from the progressive National Employment Law Project broke down the cost of assistance taxpayers pay per company:
1. McDonald's ($1.2 billion)
2. Yum! Brands (Pizza Hut, Taco Bell, KFC) ($648 million)
3. Subway ($436 million)
4. Burger King ($356 million)
5. Wendy's ($278 million)
The twin reports are being promoted by the progressive Washington DC-based public relations firm, BerlinRosen.
In an e-mailed statement to AOL Jobs, Scott DeFife, an executive vice president for the industry trade group, the National Restaurant Association, said the data provided by the study was flawed. For starters, he noted, considering the Earned Income Tax Credit program as a form of "assistance" was incorrect, given that the program is technically a credit. The studies "use a very narrow lens and selective data to attack the industry," he also wrote. He added that 40 percent of line staff workers in restaurants are students.
"The fact is that McDonald's and our independent franchisees provide jobs in every state to hundreds of thousands of people across the country," McDonald's spokeswoman Lisa McComb said by e-mail. "Those jobs range from entry-level part-time to full-time, and we offer everyone the same opportunity for advancement."
A growing movement
The release of the reports are the latest public relations gambit being made by advocates of fast food workers since they launched their campaign to improve conditions for the sector's workers 11 months ago. Groups including local community organizations with some backed by the Service Employees International Union (SEIU) have organized walkouts among fast food workers throughout the country starting in November of last year, as AOL Jobs reported.
In August, the fast food workers saw their biggest day of action yet when thousands of workers walked out of their job in about 60 cities, as AOL Jobs reported. That event was scheduled to also mark the 50th anniversary of Dr. Martin Luther King Jr.'s March on Washington for Jobs and Freedom, at which he delivered his "I Have A Dream" speech.
The workers and their advocates are making a list of demands, chief among them is the doubling of the minimum wage to $15 an hour. (The federal minimum wage currently stands at $7.25 an hour.)
Yet commentators including Michael Saltsman, the research director at the right-leaning Employment Policies Institute, say the current pay model is the only viable option. "When you have customers demanding low costs, ideas like raising the minimum wage to $15 an hour, will not be sustainable. And then all these workers will lose the jobs they have," he told AOL Jobs.
The new activism on behalf fast food workers, advocates say, is being motivated by the changing demographics in the sector. These are no longer gigs for high school students looking to add a few extra dollars to their weekly allowance. In fact, as AOL Jobs has reported, the median age of a fast food worker today is 28.
And so workers like Iverson are requiring more than the roughly $250 a week she makes at McDonald's to get by. Her need to rely on the government forces others to miss out, she said. "That money should be used to help our overcrowded schools," she added.
This post was updated on Oct. 15 at 2:15 PM Eastern Time with statements from McDonald's and the National Restaurant Association.