Fast-food workers have engaged in the #FightFor15 for quite a while now, but one chain has a different way of ensuring that labor costs remain low without having to raise the cost of a product. Wendy's plans on installing self-service kiosks at over 6,000 locations to replace cashiers. This is in response to laws mandating higher wages.
Wendy’s (WEN) said that self-service ordering kiosks will be made available across its 6,000-plus restaurants in the second half of the year as minimum wage hikes and a tight labor market push up wages.
It will be up to franchisees whether to deploy the labor-saving technology, but Wendy’s President Todd Penegor did note that some franchise locations have been raising prices to offset wage hikes.
McDonald’s (MCD) has been testing self-service kiosks. But Wendy’s, which has been vocal about embracing labor-saving technology, is launching the biggest potential expansion.
Wendy’s Penegor said company-operated stores, only about 10% of the total, are seeing wage inflation of 5% to 6%, driven both by the minimum wage and some by the need to offer a competitive wage “to access good labor.”
Yikes. Kiosks, of course, do the job of a human at the cost of $0 per hour.
Automation is coming, and it's going to be at the cost of low-skilled workers--and not just the ones at Wendy's. McDonald's is also considering using kiosks, and self-checkout lines are common at grocery stores across the country. Minimum wage laws create an artificial price floor that hurts workers more than it helps.