Wendy’s, the famous hamburger fast food chain, has rolled out an answer to rising Labor Costs brought on by demands to increase the minimum wage to $15 an hour. According to Business Insider, Wendy’s has started installing self-ordering kiosks at a thousand of its stores across the United States. No longer will someone wanting a burger have to deal with a live human being. All one has to do is to key in one’s order, pay with a credit card, and then wait for lunch to appear on the counter.
Wendy’s likes the new system because it cuts labor costs and allows the company to instantly gather data on food preferences at any given location.
The company believes that its technology investment will pay for itself after about two years. Customers will likely love the kiosks because it allows them to avoid long lines at peak periods and make ordering food effortless.
The only people who will lose out are young people who will find the number of entry level jobs that, while they don’t pay a lot, teaches them good work habits such as showing up on time and being pleasant to even the most disagreeable of customers. They may, in theory, get a “living wage” thanks to having a minimum wage of $15 an hour. But market forces have intervened to make sure that far fewer of those jobs exist than when the lower wage was about half that amount.
The social justice warriors and the unions may think they have right and fairness on their side. However, they do not have economics on their side. A job at $7.50 an hour is better than not having one at $15 an hour. But the point was not to really help low wage workers by raising their wages by fiat. The point was to score political points while sticking it to the Man.
Even kiosks will eventually go away when smartphone apps are available to order fast food even before the customer enters the store. In that system no waiting at all will be necessary. The customer will be in and out in a matter of a couple of minutes, increasing efficiency even further, destroying the jobs of kiosk repair people.
