McDonald’s announced Thursday that workers’ wages will rise by an average of 10 percent amid the economy-wide labor shortages.
The strategy of retaining workers under the rapidly changing market conditions envisions an increase in the pay of employees at the fast-food giant’s corporate-owned locations. The entry-level pay will go up to at least $11 to $17 per hour and managers’ pay will be raised to at least $15 to $20, the company’s Thursday press release stated.
Today we announced that McDonald’s USA will be raising hourly wages for more than 36,500 employees at McDonald’s-owned restaurants by an average of 10 percent. https://t.co/xNAYOLkSWB pic.twitter.com/YjQDQUQnCe
— McDonald’s Corporation (@McDonaldsCorp) May 13, 2021
The end goal is increasing the minimum wage to $15 an hour “in a phased, market-by-market approach,” the press release read.
“Some restaurants have, or will, reach an average hourly wage of $15 an hour in 2021, and average hourly wages are expected to reach $15 an hour by 2024.”
These changes will affect more than 36,500 employees at the corporate-owned restaurants, which account for roughly 5% of the overall U.S. locations, the company said.
“Together with our franchisees, we face a challenging hiring environment, and staying ahead means we must constantly renew our commitment to offer one of the leading employment packages in the industry,” McDonald’s U.S. president Joe Erlinger wrote in a letter sent to franchisees and employees, according to Business Insider.
Chipotle, a successful rival fast-food chain, announced Monday that they would be increasing their average wage for their employees to $15 an hour. (RELATED: US Companies Are Struggling To Hire Workers As Millions Remain Unemployed)
The U.S. economy added just 266,000 jobs in April, far below economists’ expectations, whose estimates had been around four times higher. A number of analysts attributed this lackluster growth — which raised many eyebrows given the robust rise in job openings — to excessively generous government unemployment benefits.
Analysts said that the fast-food chains’ decision to boost the pay of their workers may be indicative of the businesses’ struggle to keep up with the enhanced government benefits, The Financial Times reported.