Reports Say Low-Paying Fast-Food Jobs Cost Billions in Public Assistance

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From Banksy's latest (prescient) piece. Photo: BanksyNY/Instagram

Two just-released studies claim more than half of low-paying fast-food-industry employees receive public assistance, to the tune of $7 billion annually, and even go so far as to point fingers directly at McDonald's ($1.7 billion) and Yum! Brands ($1.2 billion between Pizza Hut, Taco Bell, and KFC); meanwhile, chain restaurants Subway, Burger King, and Wendy's weren't far behind. "These are conservative estimates that do not include programs like child care assistance or subsidized lunch programs," says the chair of the U.C. Berkeley Labor Center, which put out one of the studies.

Fast-food giants love to cling to the notion that most employees are teens or college kids working their first jobs, and employees are entitled to move up the management ranks for better pay. "The restaurant industry is one of the best paths to achieving the American dream," says Scott DeFife, Executive VP of the National Restaurant Association. Rising the ranks from pot washer to senior manager is a compelling story, when it happens.

But the Berkeley study found that only a third of employees at fast-food chains are under 19, while double that number are primary wage-earners. Meanwhile, authors of the report put out by the National Employment Law Project indicated that "one in five families with a member holding a fast-food job has an income below the poverty line, and 43 percent have an income two times the federal poverty level or less."

The restaurant corporations didn't respond directly to yesterday's reports, but McDonald's defended itself by stating it employs "hundreds of thousands of people across the country" and reminding the public that hourly wages are up to local franchises. Meanwhile, Burger King released a public statement that said, in part, that "many" of the company's franchisees "began their careers working at local Burger King restaurants."

Super-Sizing Public Costs [NELP]
Report: Burger King workers collecting more than $300M in public assistance [Miami Herald]
Fast Food, Poverty Wages: The Public Cost of Low-Wage Jobs in the Fast-Food Industry [UC Berkeley]

The harsh price Americans pay for fast-food jobs
[Fortune]