Skip to comments.McDonald's Faces Teen Labor Shortage ("fewer teenagers working period")
Posted on 07/23/2007 5:02:41 PM PDT by fight_truth_decay
A new McDonald's Corp. commercial tells the story of Karen King, who began her career as a teenage crew member in the 1970s and rose to head the company's $10-billion Eastern-U.S. division.
The spots are meant to resonate with American teenagers, who are leaving the workforce in droves and leaving McDonald's with a labor crunch that threatens to take a bite out of its surging sales.
"It's a shrinking labor market, and we recognize less people will be available to hire," Ms. King says.
The declining number of teenage job-seekers presents a super-size challenge for McDonald's, where 40% of the top 50 managers including CEO James Skinner worked their way up from the cash register or fry vat, and which more than ever needs qualified workers to keep service from bogging down in an era of computerized cash registers and electronic ovens.
"There is a direct correlation between the quality of the crew and sales restaurants do," says Steve Bigari, a former McDonald's franchisee who now works with fast-food companies on labor issues.
With the number of teenage applicants dwindling, McDonald's has rolled out a new commercial emphasizing the opportunity for advancement at the company. For more photos visit McJobsChicagoBusines.
For years, McDonald's has manned its crews largely with teenagers. In the 1990s, 45% of its U.S. employees were under 20. Today it's 33% of the workforce, which totals 650,000 employees.
GETTING HARDER OUT THERE
It's not just that fewer teenagers are working at McDonald's fewer are working, period. Last year about 44% of American teens held jobs, down from nearly 60% in 1982. The reason isn't clear, but many attribute the shift to an intensified focus on academics and after-school activities.
Whatever the explanation, the trend scares fast-food operators. "Everyone I talk to in the industry says it's becoming harder and harder to maintain their operations standards given what is happening in the workforce," Mr. Bigari says.
About half the employees in the fast-food industry are between 16 and 25 years old. The number of jobs in the industry is expected to increase about 17% in the next decade while the number of workers in that key age group is expected to increase 0.3%.
McDonald's is trying to get ahead of the coming squeeze with its aggressive new recruiting campaign, launched in May and driven by the TV ads featuring Ms. King. The company also revamped the recruiting portion of its Web site to facilitate online job applications, which are routed to franchisees, who hire the bulk of McDonald's front-line workers.
Lurking behind the recruiting drive is another reality: McDonald's could ease its labor crunch by raising wages. But that's a last resort for the franchisees. Increased payroll costs come directly out of their pockets.
Steve Russell, McDonald's U.S. senior vice-president of human resources and chief people officer, says the company doesn't feel pressure to raise wages, which vary by restaurant but average about $7.35 an hour, 26% over the current federal minimum wage of $5.85.
TOUCH SCREENS AND NEW MENUS
At the same time it expands recruiting efforts, McDonald's is trying to be more selective about its hires. About half of its stores require applicants to take a short test designed to measure their experience and behavior patterns. Mr. Russell says the number of stores utilizing the test quadrupled last year and the company continues to "rapidly deploy it."
The increased scrutiny matches the rising sophistication of fast-food jobs. Burgers are no longer flipped on a griddle but cooked in an oven operated by an electronic timer. New menu items have forced kitchen staff to master new preparation techniques and have given order-takers more buttons to locate on cash registers with touch screens easy to use but often intimidating to workers uncomfortable with technology.
Fumbles with the equipment slow down order times a big turnoff for customers looking for a quick meal. That's why it's critical to find, and keep, qualified workers. An internal McDonald's study shows stores with higher-performing crews reduce turnover by 30% and increase sales by $200,000 annually.
"Now more than ever, we realize our people are the main drivers of our business," Mr. Russell says.
This week in Las Vegas, McDonald's is holding a meeting of 15,000 managers at which employment will be a primary topic of discussion.
Industry observers say McDonald's has done more than any of its national competitors to promote employment, even while it may pay lower wages than some regional and national chains, such as coffee giant Starbucks Corp.
The effort may be paying off. Last year, according to Mr. Russell, McDonald's reduced its turnover by 9%, matching the chain's increase in sales, which hit $21.6 billion. The company won't disclose its retention rate; the industry averages about 150% annual employee turnover.
But it remains to be seen how McDonald's will replace the teenagers who continue to drop out of the workforce.
"There is not a readily available supply of teenage workers lined up at the door begging for jobs," says Joni Doolin, founder of People Report, a Texas-based company that tracks employment data. "And the problem is not going away anytime soon."
More McDonald's franchises will have to adjust, by enticing teenagers to work for higher wages, perhaps resort to illegal immigrants, or some other measures.
It is still going to be the Market that determines the survival of their Business. I do not have a problem with the demise of McDonald's.
They sell milkshakes with no milk in them. Well, that was so a while back. I do not know if it is still true.
The very first time I ate at a McDonald's, a hamburger cost less than a dime and it was a better product.
I have to agree with you.
Currently working in an area where excess income is the norm, I see lots of teenagers running around having a good time, with no job.
Mom/Dad hands them the money. For what? Grades.
How about them learning the other kind of grade...the one that comes from the ‘school of hard knocks.’
They need both in order to make it.
Back when Huizenga still owned the company, we had to stay until EVERY FRIGGIN' TITLE, was lined up straight on the shelf. With the mess the store would be in, we would sometimes get out at 3AM on Saturday.
Loved the free rentals, however.
THat’s what I did...to start with. Soon I was promoted to the bakery department. I made pies, cakes, muffins, rolls, etc. It was way better than a fast food joint. Before the buffet/cafeteria, I worked at burger king for 2 months. I couldn’t get along with the supervisors at a place like that. We hated eachother.
They worked me long hours at the buffet though. While in highschool I was working 35 hours per week, or whatever the max allowable was back then without being considered full time. That was alot for a 16 year old going to school every day from 8 to 3:30.
People must have very low expectations for McDonald's crew quality, because my experience has been that if this were really true, the majority of McDonald's I have been in since I came back to the States in 2004 should be bankrupt.
Great idea, except most kids today can't spell "deferred", and if they could, they would accuse us adults of trying to spoil their fun by making them put something away for the future.
McDonalds was my first ever “real” job, at age 16.
I’m still trying to get the grease out of my hair.
At Charley’s restaurant in the Minneapolis Airport, I had the opportunity to see a true professional fast food worker. An older man in front of me was struggling with his tray due to Parkinson’s. I helped him a little, but then the manager said “Sir, your luggage looks pretty heavy. This young lady (referring to an employee) will carry your tray to your table for you. It was great. She offered help and blamed the luggage, not his infirmity.
Charley’s Corporate offices got a letter from me commending her.
That’s a disgusting story, but it reminds me of how much I miss the taco joints in San Diego. I grew up in East County.
Oh Man, why did you have to mention that! I went to Point Loma and I lived at those Taco Stands
I’m a teacher. No way I would eat any place I saw one of my students.
If the problem is an increased focus on school programs and academics, then McDonalds need to do something to make a job there look good on a college application. High school sports and after school clubs look much better to admissions than a job at McDonalds right now. The college bound kids are exactly what McDonalds would love to have for employees as well.
Of course, my first real job was a research assistant at the Naval Postgraduate School (at 16 years old). So I know I’m an exception.
I worked a Dairy Queen. We would swap hamburgers for chicken from KFC. When you work at one of those places all the food begins to taste alike.
Windoze media player is driving me nuts. I'm trying to burn a CD with several albums on it that I want to listen to in order. I put them in order in the burn window, and windoze automatically re orders them.
10, 11, 12, 13 etc, OBVIOUSLY belong before 1, and duh! I OBVIOUSLY wanted albums 20-29 to play before album 2, and CLEARLY I am an idiot for not putting them in that sequence.
But that's OK, windoze will AUTOMATICALLY burn them in the order I'm too stoooooopid to place them in myself.
MMMM, In-n-Out Burger, I always go there when I go out west. It’s been almost two years now but I’ve had an InOB more recently than McD’s(I don’t go there anymore). The place was swarming with friendly kids cooking burgers and fries, taking orders, cleaning up the place, etc., an incredible business. When I went to the McD’s in my area there were certain, ahem, demographically different people than me, that were not particularlly friendly, polite or courteous in spite of me always being so to them, it was obvious that they didn’t appreciate my business so I don’t give it to them any longer. They also started TV advertising to the gangsta rap and hip hop bangers. Forget that place.
Read a complaint in the paper the other day about how one has to be bilingual to apply at some fast food restaurants.
Professor Snape? Is that you?
It's a "problem" for McDonald's.
It's Capitalism for everyone else. Quit complaining, Ronald!
They're just angry they can't hire illegals anymore.
I heard a while back that the average McD's franchise owner made about $100,000 to $150,000 per year. Not alot when you consider the time and money invested.
If a McD's is open 24 hours a day, with lets say 4 people on at all times that would be 35,000 man hours.
How much of a raise do you think they should pay?
If you dropped $1 million for the franchise, and property, and building, what type of return on your investment would expect?
How many hours a week would you work to protect your investment?
What type of return would you expect on your time?
>>The real solution is robotics technology
There is no doubt to me that the illegal immigrant invasion has substantially suppressed the introduction of automation technologies in all areas of our economy.
I teach at an inner cities school in Dallas. Any questions?
May I suggest the obvious: increase wages.
At least their parents never have to worry about those kids drowning in an open swimming pool. They’d be like buoys — all those kids would have to do would be to flip on their backs and they’d safely float until help arrived!
I knew a family that owned and operated about a dozen McDonald’s. They were definitely multi-millionaires, but I doubt over 8-figures.
Then I knew a girl who managed a Papa Gino’s (just one). She wasn’t doing so great, kind of poor.
my 15 yr old is just waiting to turn 16 so he can go out and get a job.
my 15 yr old is just waiting to turn 16 so he can go out and get a job.
My first job was a secretarial job that paid $2.35 an hour.
Damm. Ignorance would be better. At least that can be cured by edumacation.
Weren’t the temp! Thinkin bout “Supersized Big Macs” got er cranked up.
But what some would say is that because these people have so much, they obviously are shorting their employees. But the same issues apply here, that I posted, accept 8 times more.
A simple $1 an hour raise won't raise an employees lifestyle much. But $1 per man hour could make the difference between being in business and out.
I know! How I prayed for the diagnosis of ignorance but when all the tests were in it was the dreaded stupididus dumassimus,In it’s latter stages, I’m afraid it’s incurable.
They do have tattooed, pierced, ill educated and rude teens working there; lots of them. The word was that you could only be hired there is you knew someone who had worked there or was working there.
So she took a job as a waitress at a small tearoom and worked for her father as a researcher and transcribing.
I worked at an A&W as a cook. I remember sitting in math class the next day, elbows on the desk, head resting on chin, and smelling the grease on my hands.
That actually wasn't that bad of a job, all things considered. Living in Iowa, I worked detassling corn (for you city slickers, it was trying to get corn pollenated, for next year's seed crop). Basically you hit the field at 6AM, in 5 foot high corn, got soaked with dew, plucked the tassles out of the top of the corn, and then by midday, you were burning up to the heat and humidity in a windless cornfield, while you got all chafed from your wet clothes. Plus you got cut by the corn leaves, and had to walk miles. But....
It was a great incentive to study hard in school, to know I didn't want to be at age 30 and beyond with some extreme manual labor kind of job. Some people might like that, and that's ok, but I would rather use my noggin, than my back (and that is what I am doing now).
Much of that work has been taken by our friends from south of the border, though there still are some amount of Iowa teens doing that work. Mexico must really suck, if they would come 1000s of miles to do that crappy job.
Oh PUH-LEEZE! If I would have let the bruthas intimidate me when I worked a graveyard shift job at a hotel in Chicago while in Grad School”
Did the “bruthas” gang jump you and beat the hell out of you?
Did they come after you with knives?
Some of these illegals will kill you over a menial job.
And what effect does 30 years of abortion on demand have on the entry level labor pool...
May I suggest that you use your contacts and search out a better job for this obviously dependable worker. Perhaps one with medical benefits and a higher pay rate.
Just drop off a job application in an envelope preaddressed to the ‘new’ company.
Looks like a strap to me.
It had a weak moment. I’m sorry.
Here in San Diego you can not find anyone who works in any fast food place that speaks any English other than the usually middle-age manager.
When I went thru Oregon and into Washinton last year I couldn’t believe that there were ordinary white high school kids working at fast food places there. I was in the twilight zone. And high school kids pumping gas in Oregon!
I think this article is being put out to justify their hiring illegals for slave wages.
It may be, but it’s the thought that counts.
It may be, but it’s the thought that counts.
Mike Nifong is available.
LOL that was a good one!!
The Cato Institute has a report out that goes into great depth about the correlation between depressed wages due to influxes of illegal aliens, and the effects on the poor and working class children in this country.
Do you think the rise in the minimum wage may bring more teenagers and other underemployed groups into the working realm?
A wise observation - a sign of a successful leader.
This chain will simply need to pay its help more, even if it means raising prices. Teenagers expect more because of a robust economy and mom and dad bringing in more. McD's has plenty of resources to research an adjusted cost control model to accomodate this. It's all a part of free market economics, the Invisible Hand.