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$15 Minimum
Minimum Wage Spurs Restaurants to Automate?

The political successes of the $15 dollar minimum wage movement may be intensifying the interest restaurant chains have in automating their businesses. The Washington Post reports on the buzz about turning more restaurant work over to robots:

Dave Brewer is chief operating officer with Middleby Corp., which owns dozens of kitchen equipment brands, and is constantly developing new ways to optimize performance and minimize cost.

“The miracle is, the wage increase is driving the interest,” Brewer said. “But the innovation and the automation, they’re going after it even before the wages go up. Why wait?”

The labor-saving technology that has so far been rolled out most extensively — kiosk and ­tablet-based ordering — could be used to replace cashiers and the part of the wait staff’s job that involves taking orders and bringing checks. Olive Garden said earlier this year that it would roll out the Ziosk system at all its restaurants, which means that all a server has to do is bring out the food.

In other words, the unprecedented push for a $15 minimum wage, which is winning over city councils and wage boards on both coasts, might begin to cost fast-food workers their jobs even before anyone even gets a raise. The trend toward automation would take place even without minimum wage hikes, but the Post piece suggests that the $15 minimum movement could accelerate the process.

As we’ve said before, you cannot defy the laws of economic gravity; if labor becomes very costly, employers will do their best to cut back. Thanks to the rapid advance of technology, they have more, and more sophisticated, options than ever before.

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  • http://www.librarything.com/profile/Bretzky1 Brett Champion

    Unless they program the robots to give the customers attitude and the occasional eye roll, the fast food chains might just be destroying what makes the fast-food dining experience so unique.

  • rheddles

    Wow! Companies find out how to install labor saving devices. Whodathunkit?

    • JR

      I mean, you DO have to have a double digit IQ to predict that.

  • Fat_Man

    The true minimum wage remains unchanged at $0.00/hr.

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  • Ann in L.A.

    Well over a decade ago I saw a fully automated french fry maker in a McDonalds. I haven’t seen it since, but they have the tech, and it can only have improved over the years since I saw it.

  • Episteme

    It’s really the exact same issue as when, a few years back during the run-up to ACA implementation, small manufacturing businesses were limited hours and/or reducing hiring and instead investing the money into production machinery. In a time where the true Cost of Labor is uncertain (either because wage itself or wage plus additional labor costs such as health care) because of these sort of regulatory externalities, investment will be refocused into the literally Cost of labor-sparing Capital – whether it’s production machine in the small businesses in the ACA situation or the order kiosks in the Minimum Wage situation. Restaurants here can’t predict for certain how bureaucracies or councils will decide on setting the Price of Labor (which the minimum wage, economically speaking), so the best preparation is the as we saw in those other cases: minimize the number of hours that may have to be charged at an unknown cost by labor by maximizing instead a known investment in capital machinery.

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