Pay is so low for some workers that they might be unable to afford the same fast food they make and serve, two new studies, both released on October 15, find. As a result, taxpayers have to make-up the difference, say reports from the UC Berkeley Labor Project and National Employment Law Project.
“(T)he overwhelming share of jobs in the fast-food industry pay low wages that force millions of workers to rely on public assistance in order to afford health care, food, and other basic necessities,” NELP says.
A 52-percent majority of this industry’s full-time employees receive some type of public assistance. They might prepare food, but many need food stamps to purchase their own meals. Add in the costs of Medicaid, Temporary Assistance for Needy Families, Children’s Health Insurance Programs and Earned Income Tax Credit, says UC Berkeley’s “Fast Food, Poverty Wages,” and the total in public benefits received by fast-food workers hits $7 billion every year.
And a majority of that high amount – $3.6 billion annually – is due to just 10 companies alone, NELP reports in “Super-Sizing Public Costs.” (See the list of companies below.)
The profits of just six of those 10 fast-food franchises were $7.44 billion in the last fiscal year, though (the remaining four are privately-owned and don’t disclose annual profit). And while their shareholders earned another $7.7 billion, about 1.2 million employees of these 10 companies required public assistance.
That high $3.6 billion in taxpayer-funded aid doesn’t tell the total costs, either; programs like WIC, Section 8 Housing, free/reduced price school lunches, and the Low-Income Heat and Energy Assistance Program weren’t included in the calculations. Neither was cost adjustments to private health insurance, which increase annually to cover unpaid medical bills of uninsured patients; 87 percent of fast-food workers have no health insurance.
Employees of this industry are standing up of late, though, and with recent demonstrations in almost 60 cities, calling for improved wages.