Wendy's is installing self-order kiosks so it can get rid of human workers—and it's not alone

By Fusion Staff  |  May 16, 2016 | 8:02pm
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Last week Wendy’s announced that it’s going to begin installing automated self-service kiosks this year. Per Fox News in Chicago, this is “because of growing labor costs associated [with] rising minimum wages. California and New York are both raising minimum wages to $15 per hour over the next several years.”

Wendy’s is hardly the first fast food company to present looming automatization as a response to new minimum wage laws. In April White Castle VP Jamie Richardson dangled the possibility in a breathlessly fawning National Review article:

Richardson says that, in a typical year, White Castle hopes to achieve a net profit of between 1 and 2 percent — and if labor costs go up, many restaurants will turn toward labor-cost-cutting automation or business models that don’t require many employees. That means a lot of kids won’t get that first job. After decades of baggage check-in kiosks at airports, ATMs, and self-check-out lines at the supermarket, is it really so hard to imagine automation replacing the kid behind the counter at burger joints?

No, of course it’s not that hard to imagine, and consumers will probably enjoy it for the same reason they enjoy services like Seamless or Taskrabbit: some people are bad at interacting with other humans and relieved when they can outsource that interaction to a machine. Plus, as with online ordering, customers presented with the full menu on a machine may order more.

Beyond White Castle, we should also add Carl’s Jr. (whose CEO, Andy Puzder, has agitated against minimum wage increases) and McDonald’s to the list of fast food companies trying out self-service options.  Some of these are in response to higher minimum wages and some aren’t. (Snopes has a good breakdown of why McDonald’s isn’t).

Wendy’s, for its part, said the decision was due to rising labor costs. Their kiosks will only be deployed for certain in company-owned Wendy’s, which made up a pretty small fraction of the total number of outlets in the U.S. last year. Franchisees will get to decide for themselves whether to install the kiosks, but who are we kidding: they probably will if it’ll save money.

When news like this breaks, one of the things that comes to my mind is what happens when several different kiosks break down at once and there’s nobody left to take customer orders, but I digress. The response to the Wendy’s news from conservative outlets like Townhall has been to declare that a higher minimum wage hurts workers more than it helps them. I’d beg to differ, especially since it’s at least a step closer to a living wage, which, as my colleague Katie McDonough reported last year, is sometimes still unaffordable at $15/hr.

My response is [ed note: please read this next part in an extremely cool voice] “Think of the supply chain!” As Jenna Wortham illustrated very well last year in an article on the gym-hopping service ClassPass, whenever something seems too good to be true, it usually means it’s coming at the expense of someone else further up the supply chain. There is a solution, though, always mentioned as an unthinkable horror compared to laying off low-wage workers and replacing them with machines.

Pay more for your stupid square burger.

Ethan Chiel is a reporter for Fusion, writing mostly about the internet and technology. You can (and should) email him at [email protected]

 
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