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More than half of fast-food workers get public assistance

More workers in the restaurant and food services sector are enrolled in public assistance than in any other industry. The new report by economists at two universities is being used as proof that higher wages are needed. Others counter that.

Associated Press (2008)

More workers in the restaurant and food services sector are enrolled in public assistance than in any other industry. The new report by economists at two universities is being used as proof that higher wages are needed. Others counter that.

More than half of U.S. fast-food workers' families receive some sort of assistance, costing the nation $7 billion a year, according to a new report distributed by a group that has been pushing for union representation and higher wages for fast food workers.

Fast-food workers earn an average $8.69 an hour, often working fewer than 40 hours a week, qualifying them for food stamps, Medicaid and tax credits, according to the report by economists at the University of California at Berkeley and the University of Illinois at Urbana-Champaign.

Even before it was released, the report raised the ire of some conservative groups that said it used faulty methodology.

"In its quest to unionize the fast-food industry, the (Service Employees International Union) has demonstrated that it will leave no stone unturned — including using 'research' and arguments that would get a higher grade in creative writing than in a high school economics class," said Michael Saltsman, a research director at conservative think tank Employment Policies Institute, in a statement.

Even those fast-food workers employed 40 hours a week receive assistance; more than half of those families are enrolled in public programs, the report says.

Workers in the restaurant and food services industry far surpass workers in other industries for dependence on public assistance. About 44 percent of workers in the restaurant and food services sector have a family member enrolled in a public assistance program, compared with 35 percent for agriculture, forestry and fisheries and 30 percent in the retail trade.

Public assistance programs "could be more effective if supplemented by measures that improve workers' wages and benefits," the report concludes.

The nonprofit Employment Policies Institute counters, saying that raising the minimum wage would hurt fast food workers because restaurants would replace workers with automated alternatives. It also adds that although the earned income tax credit may cost the government money, it has proven effective at reducing poverty.

Fast-food workers have been holding one-day walkouts and strikes for more than a year to call attention to their wages. They want $15 an hour and union representation; the federal minimum wage is $7.25 an hour. In their most recent day of protest in August, workers in about 50 cities walked off the job.

$7 billion Annual amount in public assistance that U.S. families whose primary earner is a fast-food worker receive.

Among the report's findings:

$8.69 Average hourly wage for U.S. fast-food workers

$3.9b Amount spent annually on Medicaid and children's health care for fast-food workers and their families

$1.04b Annual food stamp benefits for fast-food families

$1.91b Amount per year that fast-food families receive from the federal government through the earned income tax credit

More than half of fast-food workers get public assistance 10/15/13 [Last modified: Tuesday, October 15, 2013 10:51pm]
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