Michigan’s Moo Cluck Moo currently pays entry-level workers $12 an hour — far above the state floor of $7.40 — but come October 1, that starting wage will rise to $15, co-owner Brian Parker told the Daily Beast’s Daniel Gross.
Asked why the restaurant, which has only been open since the spring, will raise its wages, Parker told Gross, “We always wanted to be at $15 an hour. It just feels human to do it.”
Its previously high wages brought the company better customer service, more skilled employees, less turnover, and free publicity. The time saved from having to hire new workers and train them will save it money. And with five people working at any given time, the increase in wages will mean an increase in hourly costs of $15, the cost of two transactions. The owners are betting that it will be a good investment.
While the restaurant only has one location outside of Detroit, other larger companies have followed a similar path. The West Coast In-N-Out burger chain pays entry-level workers $10.50 an hour. Massachusetts-based burrito chain Boloco pays $10 an hour and also wants to increase that figure. Dicks Drive-In in Seattle starts at $10.
Increasing wages has been found to be good for the bottom line. Raising the minimum wage can help businesses by increasing productivity, lowering turnover, and boosting demand from workers who have more money to spend on the food they make. There is also scant evidence that it hurts jobs.
Yet while the CEO of fast food giant McDonald’s claims its workers are paid above the minimum wage, wages are still too low for workers to get by. It admitted so itself when it created a model budget that instructed workers to get a second job and skip paying for heat. The pay in the industry generally is so low that workers have been striking for $15, the wage being offered at Moo Cluck Moo, with a strike that hit 58 cities last month.