Unless you’ve been living under a rock for the past six months, odds are you’ve heard many folks, a lot of whom are fast-food workers, evangelize on behalf of what’s been called a livable wage: $15 per hour. In fact, U.S. Senator Bernie Sanders (I-VT)—who’s seeking the Democratic nod for the presidency—has gone as far as introducing a bill that would raise the federal minimum raise to $15.
Currently, the minimum wage is $7.25.
It remains to be seen whether the bill gets any traction on Capitol Hill, but thanks to a Republican-controlled House and Senate, I’m not placing any bets on its becoming the law of the land any time soon.
Still, one can’t help but wonder what would happen if all workers all of a sudden saw their wages bump up to $15/hr. For some folks, that would be more than a 100% increase—a truly a life-changing amount of money for most anybody.
Talk about a raise.
Economic relativity of money aside, wishing that everyone made at least $15 is a dream worth dreaming. But we live in an age of perpetual scientific and technological innovation, which means by the time we see a $15 minimum wage, the robot workforce may already have taken our jobs.
At the risk of being a Negative Nancy, let’s take a look at cruel, cruel reality.
The Rise of the DIY Fast-Food Kiosk
Basic economics tells us that when something costs more, less of that item (in this case labor) will be demanded. That’s pretty much a given.
But the wisdom of applying this economic tenet to the minimum wage argument is fraught with conflict, at best. Conservative politicians and economists will tell us that, if fast-food franchise owners are forced to pay their employees $15/hour, they might decide to have four employees tackle the afternoon rush instead of six. They argue—as they’ve been arguing for decades—that any increase in the minimum wage will spell disaster for the U.S. economy and cause massive unemployment.
Meanwhile, liberal and progressive economists—armed with objective truth—point to localized minimum wage experiments—including one that compared Pennsylvania and New Jersey—and argue (again, with evidence on their side) that minimum wage hikes do not result in a reduction in employment.
Meanwhile, a newer and much scarier threat to employment has been rising, and we have automation to thank for it.
Many pundits predict that robots will displace fast-food workers altogether, and it’s only a matter of time. By inflating the minimum wage to a much more livable $15/hour, it’s possible that proponents of a living wage may in fact be doing more harm than good by inadvertently speeding up the rise of automation therefore displacing the very people they intended to help from their jobs.
Is it that hard to imagine a future where you enter a McDonald’s, order through a touchscreen, and essentially serve yourself? According to a recent study, there’s a 92 percent chance technology will put the fast-food worker on the unemployment line, and McDonald’s is already flirting with automation.
Technology to the Rescue
With the rise and proliferation of technology, one can’t help but wonder just how many jobs are going to be similarly displaced like the fast-food worker. After all, if robots and technology can do the work for considerably cheaper, why should business owners pay employees?
You might be worried that this oncoming influx of robots and automated kiosks will leave humans without any work to do, building an even bigger divide between the rich and poor. But if history does in fact repeat itself, you’d be wrong.
When Henry Ford, taking advantage of technology, introduced the assembly line in 1913, his critics thought he was crazy and would go out of business in the near future. Instead, he was able to pay his workers more wages (enough to buy themselves a Ford of their own), and the car manufacturer flourished. As more and more folks bought one of his cars, various other kinds of industries emerged: car washers, mechanics, detailers, body shops, etc.
According to 140 years of data, technology has created a whole lot more jobs than it’s destroyed. Recent research tells us that, since 1871, the number of humans employed in jobs considered “dull” or “dangerous” has dropped significantly—and we can thank technology for that. Beyond this, the data also tells us that many of these folks have switched to jobs that can be described as “caring occupations,” like teaching professionals and healthcare workers.
In other words, 140 years of data should give us the peace of mind that comes with knowing that the rise of robotics and automation will bring with it the rise of entirely new industries and occupations.
Is being a fast-food worker a dull job? Probably, if you’re trying to earn a “livable wage” and support your family on it. Though fast-food workers may temporarily be displaced by technology as the $15/hour movement gains more traction, if history tells us anything, they’ll land on their feet in another industry sooner or later. And we’ll all be better off for it.
If you’re still not convinced, consider this: Fifty years ago it would have been probably impossible to foresee how the creation of the Internet would impact the economy and the job market. It’s both thrilling and terrifying that we really have no idea whatsoever where or when the next Great Disruption will occur.
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