Wendy’s to Replace Low-Wage Workers with Kiosks
Earlier this month, the fast-food chain restaurant Wendy’s announced plans to install over 6,000 self-service kiosks in response to minimum wage hikes taking place across the country in over a dozen states. California and New York were the latest states to pass laws raising their minimum wage rates.
Economists have long understood that raising the minimum wage rate has negative effects on the very people the law claims to help. A 2014 Congressional Budget Office (CBO) report found that raising the minimum wage to $10.10 an hour could reduce employment by up to 1 million workers.
Wendy’s decision to replace workers with machines offers anecdotal evidence validating the CBO’s conclusion. Other businesses including McDonalds, Home Depot, and many grocery stores have already or soon will follow Wendy’s lead.
Businesses face numerous government regulations the raise the cost of labor and employment. Minimum wage hikes exasperate the labor costs for businesses even more leaving Americans fewer opportunities to find employment and begin their careers. Congress should recognize this problem and stop any attempts to raise the minimum wage at the federal level.