U.S. fast-food workers likely can only dream of earning enough money at their job to cover the cost of their rent and other bills, let alone an evening out with friends. But in Denmark, that’s reality. Fast-food workers there earn a living wage.
According to The New York Times, the base pay at Danish fast-food restaurants, including McDonald’s and Burger King, is the equivalent of $20 an hour, 2 1/2 times what most fast-food employees are paid in the U.S.
What’s more, fast-food workers in Denmark earn five weeks’ paid vacation, paid maternity and paternity leave, and a pension plan, wrote Jared Bernstein in a column in The Washington Post. Their American counterparts typically have few benefits.
“We see from Denmark that it’s possible to run a profitable fast-food business while paying workers these kinds of wages,” John Schmitt, an economist at the Center for Economic Policy Research, a liberal think tank in Washington, D.C., told the Times.
So, why the big difference in pay and benefits? Bernstein said the U.S. and Denmark are not on the same page when it comes to union power, profit margins and a commitment to pay a living wage. He wrote:
The American model for the low-wage sector — weak unions, low pay, few benefits, high turnover — keeps burgers relatively cheap here, but at the cost of working poverty for too many families who can’t come anywhere close to making ends meet on what they’re being paid. And this problem is growing as the American low-wage worker is becoming older and more likely to be a parent.
Meanwhile, at the other end of the pay scale, our model supports fatter American profit margins and much higher inequality.
With similarly priced Big Macs and a big disparity in pay, “Danish restaurants are less profitable,” the Times said. There are 16 McDonald’s per 1 million people in Denmark, compared with 45 in the U.S. The Times added:
America’s restaurant industry predicts a wave of woe if pay were to jump toward Denmark’s levels. An increase to $15 would “limit employment opportunities” by making fast-food restaurants reluctant to hire, said Scott DeFife, an executive vice president at the National Restaurant Association. “More than doubling the starting wage will dramatically increase costs in an industry that exists on very narrow margins.”
Does it surprise you that McDonald’s pays its Danish workers so much more per hour than its U.S. workers, while still staying profitable? Share your comments below or on our Facebook page.