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Manufacturing Meals

Perhaps my least-loved posts of all time are my posts noting the arbitrariness of the “manufacturing” category of employment. Consider Bloomberg Businessweek’s in-depth profile of Taco Bell which explicitly looks at it as a firm consisting of a series of small factories on which assembly line workers construct faux Mexican food:

Every Taco Bell, McDonald’s (MCD), Wendy’s (WEN), and Burger King is a little factory, with a manager who oversees three dozen workers, devises schedules and shifts, keeps track of inventory and the supply chain, supervises an assembly line churning out a quality-controlled, high-volume product, and takes in revenue of $1 million to $3 million a year, all with customers who show up at the front end of the factory at all hours of the day to buy the product. Taco Bell Chief Executive Officer Greg Creed, a veteran of the detergents and personal products division of Unilever (UL), puts it this way: “I think at Unilever, we had five factories. Well, at Taco Bell today I’ve got 6,000 factories, many of them running 24 hours a day.”

And note that it’s literally the case that if these people were manufacturing cans of tuna fish for people to buy in stores and eat at home that the BLS would classify them as manufacturing workers. Food is food as far as I’m concerned. The interesting difference is that you have international trade in cans of tuna fish and you don’t have international trade in Wendy’s spicy chicken sandwiches. That helps protect low-productivity work in the fast food sector from vanishing, but at the cost of low wages. Apparently, though, contrary to stereotype Taco Bell isn’t scraping the very bottom of the labor market value — workers start earning $1.25 an hour above minimum wage. Hardly a princely sum, but obviously there are people out there doing jobs for less.

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