What's the Difference Between a $5.60 Big Mac and a $4.80 Big Mac?

One of them comes with a living wage for the server, and the other doesn't.

In today's New York Times, Liz Alderman and Steven Greenhouse explore the difference between a Big Mac purchased in Denmark and one bought in the United States (full article, here). For the consumer, the difference is 80 cents (16.67%), which was actually a lot less than I had expected, given how loudly U.S. franchises have been prophesying the end-of-the-world should living wages become the norm here.

Cross-cultural comparisons are always risky. Denmark has a much higher cost of living than most of the U.S., higher taxes, high levels of unionization, etc.

But... the Danish example proves that it is possible to have that Big Mac and not penalize the McDonald's worker for the sin of being poor.

I've written before about the appalling way that U.S. capitalism concentrates on going lower and lower (example here). A living wage is a moral issue, not an economic one, but it's nice to know that the economics work too. 

The base wage for a McDonald's employee in Denmark is $20 an hour, "two and a half times what many fast-food workers earn in the United States," and much higher than the $15 an hour for which  many U.S. workers have been campaigning. Note that:

Denmark has no minimum-wage law. But ... [a Danish worker's] $20 an hour is the lowest the fast-food industry can pay under an agreement between Denmark’s 3F union, the nation’s largest, and the Danish employers group Horesta, which includes Burger King, McDonald’s, Starbucks and other restaurant and hotel companies.

By contrast, fast-food wages in the United States are so low that half of the nation’s fast-food workers rely on some form of public assistance, a study from the University of California, Berkeley found. American fast-food workers earn an average of $8.90 an hour.

Most corporate fast-food companies won't discuss employee wages because "those decisions [are] made by its franchise operators", which is disingenuous at best, since corporate will train franchisees on how best to keep down labor costs.

But it's not just the wages that are different:

In Denmark, fast-food workers are guaranteed benefits their American counterparts could only dream of. Under the industry’s collective agreement, there are five weeks’ paid vacation, paid maternity and paternity leave and a pension plan. Workers must be paid overtime for working after 6 p.m. and on Sundays.

Unlike most American fast-food workers, the Danes often get their work schedules four weeks in advance, and employees cannot be sent home early without pay just because business slows.

In other words, Danish workers are treated like valuable human beings, not simply as "costs". Not surprisingly, fast-food worker turnover is low and front-line employees even think about their jobs as potential careers, not something to move on from as quickly as possible. Turnover is expensive, but you don't see U.S. fast-food companies looking for good ways to reduce that, do you?



True, Danish fast-food franchises appear to be less profitable than American ones (by how much is not clear, but they're certainly not unprofitable, or they wouldn't be around for long). And those burgers are certainly a little more expensive, but Danes seem OK with that:

“We Danes accept that a burger is expensive, but we also know that working conditions and wages are decent when we eat that burger,” said Soren Kaj Andersen, a University of Copenhagen professor who specializes in labor issues.

That U.S. Big Mac still taste as good to you? Mine seems to have some straw in it.