Liberal activists and some striking McDonald's employees have called for a minimum wage of $15 at McDonalds restaurants. Below is the Profit & Loss statement for an average McDonalds.
Before any change, the store has a profit of $153,900. A wage increase from $8 to $15 would be an increase of 87.5%, increasing operational costs by $472,500 per year, not including payroll taxes, resulting in a store operating loss of $318,600. The restaurant would go out of business and everyone would lose their jobs.
So, realistically, how is the average McDonald's restaurant to pay its crew members $15 per hour? Where is that money supposed to come from?