A new reports claims low fast food industry wages cost Florida millions. (Photo via Judy Baxter)
By Ashley Lopez
Florida Center for Investigative Reporting
A new report from the University of California-Berkeley shows that low-paying fast food jobs are costing Florida millions of dollars every year.
According to a press release from Berkeley, research shows that “the fast-food industry costs American taxpayers nearly $7 billion annually because its jobs pay so little that 52 percent of fast-food workers are forced to enroll their families in public assistance programs.”
“The taxpayer costs we discovered were staggering,” said Ken Jacobs, chair of UC Berkeley’s Center for Labor Research and Education and coauthor of the report. “People who work in fast-food jobs are paid so little that having to rely on public assistance is the rule, rather than the exception, even for those working 40 hours or more a week.”
Fast food is a $200 billion-a-year industry. The median wage for core front-line workers at fast-food restaurants nationally is $8.69 an hour. Only 13 percent of the jobs provide health benefits.
According to the report, the state of Florida is fifth in the country for the amount of money is spends providing benefits to these employees.
The states where the fast-food industry’s low wages cost U.S. taxpayers the most include California at $717 million, New York at $708 million, Texas at $556 million, Illinois at $368 million and Florida at $348 million. A breakdown of other states for which data are available is in the report, “Fast Food, Poverty Wages: The Public Cost of Low-Wage Jobs in the Fast-Food Industry.”
In Florida, 55 percent of the state’s 115,000 fast-food employees on public programs like food stamps and Medicaid.
Here some other big findings from the study:
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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.
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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.
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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
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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.
In the past couple of years, an influx of low-wage jobs has been an ongoing trend in Florida.
A Georgetown study released last year found that as the state sees jobless numbers decrease, a lot of the new jobs tend to be low-skilled jobs that pay less than the jobs they replace.
During the Great Recession, Florida has seen job numbers grow mostly in the service industry, including tourism.
However, as low-wage jobs have flooded in, the state has been cutting funding for state programs such as Medicaid. This year, the state’s Medicaid program was privatized.
State lawmakers even turned down money from the federal government this year that would have fully paid for Florida to expand its Medicaid program to more people.
Because the money was tied to the federal health care law, state lawmakers have claimed an ideological opposition to the money, even though there are almost 4 million uninsured people in Florida. Much of the uninsured is the working poor—people working low wage jobs that offer them little to no benefits.