Half of fast-food workersin state rely on public aid

By Jamey Dunn

More than half of front-line fast food workers in Illinois are recipients of public aid.

A new report titled Fast Food. Poverty Wages: The Public Cost of Low-Wage Jobs in the Fast-Food Industry from the University of Illinois at Urbana-Champaign and the University of California Berkley’s Labor Center found that 51 percent of the 84,000 workers in the fast food industry in the state rely on public aid programs, such as Medicaid and the Supplemental Nutrition Assistance Program (SNAP). Illinois’ stats were similar to national finding. Across the country, 52 percent of the employees of fast food restaurants are enrolled in public assistance programs. That compares with 25 percent of the workforce as a whole. The study also says that 73 percent of those enrolled in the programs covered in the study — Medicaid, SNAP, Earned Income Tax Credits and Medicaid programs specifically for children — are employed or are part of a family that has at least one employed member.

The median pay for fast food employees across the nation is $8.69. The report notes that pay for fast food workers is usually at or near minimum wage, which is $8.25 an hour in Illinois. The median number of working hours available to fast food workers each week is 30. An estimated 87 percent of fast-food workers do not receive health care coverage through their employers.

“The combination of low wages and benefits, often coupled with part-time employment, means that many of the families of fast-food workers must rely on taxpayer-funded safety net to make ends meet,” the study says. “People working in fast-food jobs are more likely to live in or near poverty. One in five families with a member holding a fast-food job has an income below the poverty line.”

The estimated national cost for public benefits given to fast food workers is $7 billion each year. In Illinois, the cost is $368 million annually. About 60 percent of the total national cost, or $3.8 billion, comes from the 10 largest fast food companies, according to a companion report issued today by the New-York-based National Employment Law Project. Last year, those companies reported $7.4 billion in profits and paid $52.7 million to their highest-level corporate employees.

The authors of Fast Food. Poverty Wages: The Public Cost of Low-Wage Jobs in the Fast-Food Industry say these costs should be considered when public policy choices about public aid and minimum wages are made. “Although extensive, the hidden public cost of low-wage work rarely factors into debates about state and national policy. The public benefits discussed in this report provide a vital support system for millions of the working poor. The findings of this report suggest those programs could be more effective if supplemented by measures that improve workers’ wages and benefits, either through public policy measures such as living and minimum wage laws, or through collective bargaining.”