Customers at the new San Francisco McDonald's on Sutter Street are greeted not with a friendly smile but with the impersonal glare of two human-sized electronic tablets ready to take their order. Not coincidentally, San Francisco’s minimum wage increased to $12.25 an hour earlier this month. The city has long had one of the highest wage floors in the country.
These automated ordering systems are a stark reminder that employers can automate jobs when the cost of entry-level service employees becomes higher than what consumers are willing to pay for that service. Employers don’t do this because they’re unkind; business is a Darwinian struggle where only those who can control costs to maintain their often razor-thin profit margins can survive.
The reduced job opportunities that come as a result of these cost-cutting measures disproportionately impact society’s most vulnerable. The academic evidence clearly shows minimum wage hikes price some of these less-skilled employees out of the job market entirely.
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