Monday, February 3, 2014

Food-and-bev tech innovations aren't driven by minimum wage increases

The burger-flipping robots are coming

Posted by Chris Haire on Mon, Feb 3, 2014 at 2:55 PM

I really don't have a dog in the minimum wage debate. And if I did, it would only have three legs, the mange, and breath so bad that it would revive a smackhead from the motherfucker of all overdoses. Shit's stanky. 

But like Justin Bieber's downward spiral and Miley Cyrus' foray into performance tart, I have to follow it because somebody at some point in time is going to expect me to have an opinion about it and, well, I'll have to say something that appears half-informed even if I'm just making a sophomoric joke. 

Which brings me to an op-ed penned by Michael Saltsman in the Wall Street Journal. In case you don't know, Saltsman is the research director at the Employment Policies Institute, a think tank that specializes in pro-service industry talking points. Saltsman writes:
Ten years ago it might have seemed far-fetched that a customer could order food in a restaurant without speaking to anyone. But it's a reality now as service employers across the country—including Chili's, Chevys Fresh Mex and California Pizza Kitchen—introduce tabletop ordering devices. A few clicks on an iPad-like device and the food is on its way.

Technology has made these changes possible, but that's not what's driving their implementation. Steady federal and state increases to the minimum wage have forced employers in retail and service industries to rely on technology as the government makes entry-level labor more expensive. 
He then goes on to bemoan the fact that tech advances — including self-serve soda fountains, table-top iPad "servers," and burger-flipping machines — are decimating the ranks of service industry professionals. He writes:

"Efficiency" is the positive public face of these changes. Chris Sullivan —a co-founder of Outback Steakhouse who now works with MenuPad, a tablet-ordering company—explained his product to me this way: "It increases productivity, allowing servers to wait on more tables." That means tips may increase for some.

But the flip-side of more efficiency is a 20%-25% drop in the number of waitstaff necessary to run a restaurant. Currently, a worker who earns tips can be paid below minimum wage, allowing tips to make up the difference. But the $10.10 proposal would raise the minimum tip wage to $7.07 from $2.13, a 232% spike. With roughly three million current tipped jobs in the U.S., that could amount to as many as 750,000 fewer entry-level opportunities if implemented widely.
But while Saltsman is correct when he says that tech is displacing F&B workers, he's full of shit when it comes to the motivations of restauranteurs.

Minimum wage increases aren't forcing them to find ways to cut costs — namely by replacing workers with machines — these business owners would be doing this regardless. If the folks at McDonalds or Chilis or even frikkin hippie-loving Chipolte could find a way to run a fully automated business at a cheaper cost than running one staffed by mistake-prone, shift-missing people, they would. To suggest otherwise is just being dishonest. 




Tags: , ,


Comments (43)

Showing 1-43 of 43

Add a comment

 
Subscribe to this thread:
Showing 1-43 of 43

Add a comment

Classified Listings
Most Viewed

Powered by Foundation   © Copyright 2014, Charleston City Paper   RSS