Posted on 07/03/2016 4:15:00 AM PDT by HomerBohn
ZeroHedge reminds us that a year ago, owner and CEO of Seattle-based Starbucks, Howard Schultz, piously told CNN that he supported raising the minimum wage to $15/hour “across the country,” but warned that “it will be very difficult for small business in the country at a $15 level to pay those kinds of wages.” Then Schultz grandly announced that Starbucks will lead the way by raising the wages of its employees “way above the minimum wage”:
“For Starbucks come January 1 we are taking wages up across the country and we will pay above the minimum wage in every state we operate. Starbucks is way above the minimum wage. I have always looked at total compensation. I have always believed that our success as a company is best shared.“
Note that a worker’s total compensation is a function of hourly wages and total number of hours worked.
Fast forward a year . . . .
Lisa Baertlein reports for Reuters, June 30, 2016, that Starbucks, the world’s biggest coffee chain that employs 160,000 people in the United States, is accused by an online petition, signed by more than 9,000 people, of “extreme” cutbacks in work hours at its U.S. cafes, which hurt both employee morale and customer service.
In other words, Starbucks compensated for raising its employees’ wages to “way above minimum wage” by reducing its workers’ hours, so as to maintain its profitability.
According to Jaime Prater, a Southern California barista and the online petition’s creator, some 7,000 signers of the petition described themselves as Starbuck employees.
Prater said “The labor situation has gone from tight to infuriating.” The manager of a central California Starbucks who asked not to be identified for fear of reprisal, told Reuters that the store’s work force has shrunk by about 10%, even though sales are up.
Similar complaints were made by many signers of the online petition:
Signer Aaron I. wrote: “No matter what we do to save on labor at my store, the system tells us EVERY SINGLE DAY that we are at least 8 hours over in labor for the day and have to cut even more.”
Leslie S, a self-described shift manager, wrote: “We’re suffering, & so are our customers. It’s not working.”
Makenna S, a shift supervisor, wrote: “Mobile orders have increased sales and created more need for labor, yet the company is cutting labor.”
While its employees contend with reduced work hours and, therefore, pay, Starbucks’ established cafes in U.S.-dominated Americas region is enjoying increased sales of:
9% sales increase in the first quarter of this year,
7% increase in the second quarter, and
an expected 6.2% increase for the current quarter, according to Consensus Metrix.
Howard Penney, an analyst at Hedgeye Risk Management who follows Starbucks, observed, “They’ve been posting industry-leading same-store sales growth for the last five years while reducing labor costs – a trend that can’t continue.”
According to Wikipedia, Starbucks’ CEO Howard D. Schultz “was born to a Jewish family on July 19, 1953, in Brooklyn, New York.” He is pro-gun control and same-sex marriage. In 2012, Forbes magazine ranked Schultz as the 354th richest person in the United States, with a net worth of $1.5 billion.
Howard Schultz’s name should be listed in dictionaries as a synonym of hypocrisy
Coffee machine. Put a quarter in and out comes coffee. Just need to upgrade the flavor of output. Ad a chatty voice and your there.
” My great grand mother was installed in the break room at the General Electric plant in Liverpool, NY. She didn’t speak....... “
“In matters of taste there is no right or wrong.”
True...but “to buy” or “to not buy” becomes the prevailing dichotomy, the yin and yang as it were.
And paying six bucks for burned s*** in a cup scribbled with socialism handed to you by a pimply faced know-it-all barista who expects a tip, to that I say,
“No thanks”.
And they won’t even add the sugar or creamer for ya....99 cents a cup at any mcdonalds...and they even do the sugar and creamer part...fancy that?
Table A. Relative importance of employer costs for employee compensation, March 2016
http://www.bls.gov/news.release/ecec.htm
No, it demonstrates he is a marketing genius.
It makes people think that Starbucks is a socially conscious company, which plays well with their customer demographic.
And, it places competitors at a disadvantage, especially if they don't have the labor flexibility to reduce hours when they increase pay.
Explain to me how it harms an employee to get a 10% raise and then have 10% fewer hours scheduled. You can't, because it actually benefits the employee since he now has more free time.
I resisted the temptation to tell Adder “In matters of taste there is no right or wrong, but you’re wrong!”
I tip,and tip well,for table service ONLY.
I will never tip for take out coffee.
.
Many of my coworkers tried Starbucks once, and have been drinking Dunkin’ Donuts ever since.
Starbucks tastes so awful black & barefoot that customers will pay for the added schlock just to cover it up.
I don’t have the option of sitting at home with a cup of coffee. I am out of the house 14 hours a day and need to be on the road by 4:30 am.
That’s why God made slip-ons..
PEETS COFFEE IS SUPERIOR
grind the beans
use a thermal coffee mug
YETI
THERMOS
CONTIGO
cheaper, better coffee...
BUT
IF YOU WANT TO PAY FOR THE BARISTA SHOW AND EFFEMINATE ATMOSPHERE
continue...
Worker’s comp insurance, the employer portion of SSI - to name a few more.
Six dollars? I pay $1 for a Starbucks cup of coffee in E TN.
Have you ever asked? They do it for me.
I swear, there's so many people who have never set foot in a Starbucks but know all about their coffee products and how they operate.
I don’t think either of those would be considered “compensation” for an employee. The workers comp insurance also protects the employer (who would otherwise be liable for worker injuries anyway), and a payroll tax for SSI is a tax, not paid to an employee.
How much labor will they need if the customers engage every employee in a conversation about race?
Yes i went to a starbucks once...and they gave me a black coffee and directed me to a filthy area where the cream and sugar was....I grind my own beans and brew coffee that way....I loathe going to any coffee shop let alone such a politically biased organization such as starbucks...
Wrong! Waffles are always better than pancakes! ;-)
“Starbucks charges $6 for a cup of coffee and pays workers $15 per hour for a job any high school dropout can easily do.......BUT, then has the gall to put a damn tip jar at the check out counter....Star Bucks can Kiss My Backside”
That's too bad. I go there nearly every day and my experience is nothing like that at all.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.