Former McDonald’s President Ed Rensi warned Tuesday thatreplacing workers with robots is far less costly than hiring newemployees at $15 an hour.
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Democratic lawmakers and advocates from across the country havefought to raise the minimum wage to $15 an hour. Those in supportbelieve the policy could help address poverty, but critics say itcould also lead to less employment opportunities. Rensi noted itwill be cheaper for many businesses to purchase a $35,000 robotinstead of hiring a new employee at $15 an hour.
“If you look at the robotic devices that are coming into therestaurant industry — it’s cheaper to buy a $35,000 robotic armthan it is to hire an employee who’s inefficient making $15 an hourbagging French fries,” Rensi told Fox Business. “It’s nonsense andit’s very destructive and it’s inflationary and it’s going to causea job loss across this country like you’re not going tobelieve.”
Rensi added he saw some of the robotic innovations firsthandMonday during the National Restaurant Show. Employers could be leftwith few options to overcome the added costs of labor if theminimum wage goes too high. Replacing low-skilled workers withcomputers and robots is one solution to be more costefficient.
“It’s not just going to be in the fast food business,” Rensicontinued. “Franchising is the best business model in the UnitedStates. It’s dependent on people that have low job skills that haveto grow. Well if you can’t get people a reasonable wage, you’regoing to get machines to do the work. It’s just common sense. It’sgoing to happen whether you like it or not.”
Rensi believes lawmakers should do away with a federal minimumwage and instead leave it to the states. Republican presidentialcandidate Donald Trump expressed similar support for a state basedminimum wage policy. States have different costs of living levels,meaning any national minimum wage will impact each differently.
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“I think we ought to have a multi-faceted wage program in thiscountry,” Rensi concluded. “If you’re a high school kid, youought to have a student wage. If you’re an entry level worker youought to have a separate wage. The states ought to manage thisbecause they know more [about] what’s going on the ground thananybody in Washington D.C.”
The nonpartisan Congressional Budget Office (CBO) found anyincrease of the minimum wage could result in at least some jobloss. New York and California both became the first states Apr. 4 to raise the minimumwages to $15 an hour. Advocates have also seen victories on thecity level, starting with Seattle in June 2014.
The Fight for $15 has been at the forefront of the minimum wagepush, utilizing media marketing campaigns and protests to garnersupport for the increase. The movement launched what it claimed wasthe biggest protest Apr. 14, which involved rallies in citiesacross the country.
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