$96 million in Washington, $7 billion nationally: the public cost of fast food poverty wages

National chains profit by leaving workers in poverty, shifting costs to the rest of us.

Poverty wages at food chains cost the public $96 million in our state, and almost $7 billion nationally, according to two new reports unveiled today by fast food workers and community supporters outside the SoDo Burger King (3301 4th Ave S), including State Representative Zack Hudgins (11th District).

"Corporations are making profits and passing the costs onto us. There's no excuse for that," Representative Hudgins explained. "I'm going to be talking to my colleagues in Olympia about this cost shifting. We are going to do something about it!" Note: Rep. Hudgins is available for comment this afternoon.

The research shows how the big national chains pad their profits by paying such low wages that nearly 12,000 fast food workers in our state alone need assistance from food stamps or another anti-poverty program to fill the gap between what they're paid, and what it takes to survive.

"Because Burger King pays such low wages I actually had to borrow money from my father -- for underwear," said Jason Harvey, who has worked at Burger King for 6 years and is paid the state minimum wage of $9.19/hour. Even though he works preparing and serving food for as many hours as Burger King will schedule him, Jason couldn't afford to eat without the help of food stamps, and wouldn't have a place to leave without public housing assistance. "I'm 42 years old. It ain't right."

The UC Berkeley report Fast food, poverty wages cross-references occupational data, the Census Bureau's American Community Survey, and other public data sources to show the extent to which fast food workers live in poverty and need assistance from a major anti-poverty program to fill the gap between what they're paid, and what it takes to survive. The data shows that in Washington State:

  • 26% of fast food workers need assistance from food stamps
  • 30% receive support from the Earned Income Tax Credit
  • 18% get healthcare through Medicaid, and 17% have children in their households who get healthcare through Medicaid/CHIP.
  • Overall, 41% of fast food workers need support from at least one of these major anti-poverty programs to survive.
  • Our state spends $96 million providing anti-poverty assistance to poverty-wage fast food workers.

The National Employment Law Project report Super-sizing public costs takes the UC Berkeley report and analyzes which chains shift the most costs to the rest of us. The 4 largest fast food chains leave workers in poverty and shift enormous costs to the public:

  • McDonald's: $1.2 billion in public costs to aid workers in poverty
  • Yum! Brands: $648 million in public costs to aid workers in poverty. (Yum! owns Taco Bell, KFC, and other chains.)
  • Subway: $436 million in public costs to aid workers in poverty
  • Burger King: $356 million in public costs to aid workers in poverty
  • The top 10 largest fast food chains shift a total of $3.8 billion in costs — while banking total profits well in excess of that amount and leaving workers in poverty. The fast food industry overall shifts just shy of $7 billion in costs.

Sparked by this summer's fast food & coffee strikes, Good Jobs Seattle is a growing movement which seeks to build a sustainable future for Seattle's economy from the middle out — by turning poverty-wage jobs in fast food and other industries into good jobs that offer opportunities for a better future and pay enough for workers to afford basic necessities like food, clothing and rent. Good Jobs Seattle is supported by organizations including Washington Community Action Network, Working Washington, OneAmerica, SEIU Healthcare 775NW and hundreds of workers and grassroots supporters.