Burger Cooks Cost $7 Billion a Year in Government Aid

Hamburger grillers and other fast-food workers at restaurants such as McDonald’s Corp. (MCD) and Wendy’s Co. get about $7 billion a year in U.S. government aid, a report published today shows.

With jobs not paying enough for employees to meet their basic needs, an increasing number of working families must rely on publicly funded programs to make ends meet, according to a study from the University of California at Berkeley and the University of Illinois at Urbana-Champaign.

Fast-food employees have gone on strike this year to demand $15-an-hour pay and the right to form a union as income inequality in the U.S. grows. Fast-food cooks make $9 an hour on average, according to the Bureau of Labor Statistics. While thousands of workers have protested in cities including New York, Chicago, Los Angeles, Detroit and Milwaukee this year, the strikes have done little so far to change the restaurant sector, which employs more than 10 million Americans.

“The industry is a heavy user of minimum-wage and low-wage workers,” Sylvia Allegretto, an economist at Berkeley and an author of the report, said in an interview. “Low-wage workers today, in general, are making less than their counterparts did 50 years ago.”

Photographer: Matthew Staver/Bloomberg

More than half of fast-food worker families participate in U.S. government aid programs, compared with 25 percent of the total U.S. workforce, the report shows. Close

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Photographer: Matthew Staver/Bloomberg

More than half of fast-food worker families participate in U.S. government aid programs, compared with 25 percent of the total U.S. workforce, the report shows.

That’s why some fry cooks are finding it harder to pull themselves out of poverty and get ahead, she said.

When workers tap programs such as Medicaid, food stamps, the earned income tax credit and temporary aid for needy families to bridge the gap between paychecks, the cost is borne by taxpayers, according to the report which analyzed the years 2007 to 2011.

More than half of fast-food worker families participate in these government programs, compared with 25 percent of the total U.S. workforce, the report shows.

Congress last raised the minimum wage in 2009, and President Barack Obama’s call this year to increase it to $9 an hour from $7.25 has gone nowhere with lawmakers. Some states require pay that’s higher than the federal rate.

Worker advocacy group Fast Food Forward paid for the study. The New York-based organization receives funding from the Service Employees International Union.

To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net

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