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Subsidizing the Fast Food Industry

October 21, 2013
Super-Sizing Profits: A new report by the National Employment Law Project.

Super-Sizing Profits: A new report by the National Employment Law Project.

Most informed readers are well-aware of the system of federal farm subsidies that make commodity crops like corn, soy, and wheat cheaper. These subsidies indirectly reduce the cost of fast food and junk food by making soy fillershigh fructose corn syrup, and meat production much less expensive than they would otherwise be.

But a report by the National Employment Law Project published last week uncovered another federal subsidy for the fast food industry. Using data from the US Census Bureau, the report found that “52 percent of fast-food cooks, cashiers and other “front-line” staff had relied on at least one form of public assistance, such as Medicaid, food stamps and the Earned Income Tax Credit program, between 2007 and 2011.” Support for the 10 largest fast food restaurant companies cost tax payers more than $3.8 billion per year.

Fast food workers have been striking in recent months demanding higher wages, and a McDonald’s educational pamphlet for its employees highlighted the challenges they face. And contrary to the popular perception, most employees are not young people doing entry level work as they make their way through high school. The median age for a fast food worker is 28, and the median wage they are paid is $8.94 per hour. Most are not offered full time employment, forcing them to seek second (or third) jobs and to reply n public aid programs to supplement their low wages and poor benefits.

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One Comment
  1. FWIW: The effect of subsides has very little effect on the price of fast food. In some cases it can even make food more expensive.

    Subsides are bad. So are price and wage controls.

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