The University of California Berkeley has released a new report today outlining the cost that comes with having a service sector (specifically fast food) labor force making today’s current minimum wage salary. The report finds that by paying fast food workers a meager minimum wage, those workers are forced to take on public services to meet their basic fundamental life needs, thus costing our nation billions in tax dollars each year… and that’s just the effect from the fast food industry.

The report lists its findings:

“1. More than half (52 percent) of the families of front-line fast-food workers are enrolled in one or more public programs, compared to 25 percent of the workforce as a whole.

2. The cost of public assistance to families of workers in the fast-food industry is nearly $7 billion per year.

3. At an average of $3.9 billion per year, spending on Medicaid and the Children’s Health Insurance Program (CHIP) accounts for more than half of these costs.

4. Due to low earnings, fast-food workers’ families also receive an annual average of $1.04 billion in food stamp benefits and $1.91 billion in Earned Income Tax Credit payments.

5. 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, and 43 percent have an income two times the federal poverty level or less.

6. Even full-time hours are not enough to compensate for low wages. The families of more than half of the fast-food workers employed 40 or more hours per week are enrolled in public assistance programs.”

Full report found here:
laborcenter.berkeley.edu

Further, a second report from the National Employment Law Project (NELP) has found that the same companies who are paying these paltry wages are raking in billions of dollars per year in profits. Meanwhile their employees are forced to take on food stamps, government housing and medical care. The report calculates that this policy costs the public roughly $1.2 billion from McDonald’s alone each year.

Full report from NELP

nelp.org

I guess it shouldn’t come as a huge shocker that a minimum wage below any reasonable standard of living isn’t saving anyone except corporations’ money, but the exact figures are staggering.