By Samuel McCarran for The Liberty Block
At this point, I assume that most of us have heard of the “fight for $15” campaign that has proliferated throughout the US over the last few years.For this article, I will focus on McDonald’s workers campaigning for the vaunted $15/hour wage.
Filled with stories designed to stir up envy, people howled with statistics about how some of McDonald’s employees would have to work every hour of the year for over a century (114 years) straight) to make as much as the CEO makes, which seems to be $4,207 per hour, assuming that he works for eight hours a day, five days a week, 52 weeks a year. This equates to $8,750,560/year. And let’s just ignore the fact most people do not work at McDonald’s as a career because that is neither here nor there.
But this is even worse than it seems!
There are 8,760 hours in a year, and obviously one must sleep, eat, shower, etc.; assuming that one works eight hours a day, five days a week, 52 weeks a year, this adds up to 2,080 hours, which is 4.21 times less than the actual number of hours in a year. Multiplying 114 by 4.21 gives the number 480, meaning this worker makes 480 times less than the CEO at McDonald’s, which adds up to a measly $18,230! Truly a horrible case of income inequality!
Or is it?
No, it really isn’t. Allow me to explain.
The overwhelming majority of McDonald’s employees work for franchises, not the corporate-owned stores. Employees at corporate stores make an average of $10/hour, and get such benefits as tuition assistance and paid time off. While McDonald’s itself is extremely profitable, individual franchises are much less so; 51.5% of ALL fast-food franchises make less than $50,000 of profit each year, and the AVERAGE individual franchise makes $82,033 in annual profit. I could not find a source for McDonald’s specifically, but it’s a relatively safe bet they aren’t lighting cigars with $100 bills while Wendy’s and Burger King franchisees starve.
Speaking only for the United States, McDonald’s employs around 750,000 employees, 660,000 of which work for franchises, meaning McDonald’s itself, as a direct employer, only employs about 90,000 people – only 12% of the total workforce under the Golden Arches. There are 14,146 McDonald’s restaurants in the United States, 82% of which are owned by franchisees; this gives us 11,600 franchised restaurants, and only 2,546 owned by the corporate firm itself.
Assuming that every McDonald’s franchise is a sole proprietorship, this means that the average ‘Tyree’ makes around 4.5 times less than his franchise owner – a very reasonable discrepancy between someone working an entry-level, unskilled, untrained job and an entrepreneur who has personally put an enormous amount on the line coupled with hard work and is creating jobs in the process. This is a far cry from the “480 times” the story seems like on the surface. This is yet another case of leftist propagandists twisting the truth to stir anxiety, fear, and resentment (which can lead to health problems and thus bankruptcy and debt) in the same poor people they pretend to care about.