If one wants a good illustration of how immoral corporate America has become one need look no further than McDonald's. Leslie Patton of Bloomberg wrote a profile of McDonald's employee, Tyree Johnson, who is paid the minimum wage in Chicago, $8.25 per hour, while his boss, Jim Skinner, took home a cool $8.75 million last year.

Imagine that. If Mr. Johnson works 40 hours a week he will make $16,830 a year. At that rate it would take Mr. Johnson more than 520 years of cooking and serving burgers and fries to make what CEO Skinner takes home for attending meetings, making big decisions and riding around in his limousine. And the only reason why it's only 520 years rather than 600 or more years is that Mr. Johnson is paid the minimum wage in Chicago, which is a dollar more than the federal minimum wage.

For all those folks who think that fast food workers are high school kids or college students trying to make an extra buck think again. Tyree Johnson is 44 years old and has work for McDonald's for 20 years.

Mr. Johnson is not the exception, but is increasingly becoming the rule.

Older workers like Johnson are staffing fast-food grills and fryers more often, according to data from the U.S. Census Bureau’s Current Population Survey. In 2010, 16- to 19-year-olds made up 17 percent of food preparation and serving workers, down from almost a quarter in 2000, as older, underemployed Americans took those jobs.

“The sheer number of adults in the industry has just exploded” because fast-food restaurants “not only survived, but thrived during the economic recession,” said Saru Jayaraman, director of the Food Labor Research Center at the University of California at Berkeley.

This situation exists for many reasons but there are two significant ones at play here. First, the minimum wage has less purchasing power then at any time since 1968. That reduction in purchasing power is due in large part to the efforts of men like Mr. Skinner who, with his fellow travelers in the upper echelons of corporate America, has managed to effectively suppress efforts to increase the minimum wage. And lest there be any doubt, every increase in the minimum wage has the effect of increasing the wages of wage earners whose salaries have risen above the minimum.

The second factor is the explosion of CEO income over the last 30 years when compared with the stagnation of employee income. As noted in this article,

CEO pay spiked 725 percent between 1978 and 2011, while worker pay rose just 5.7 percent, according to a study by the Economic Policy Institute released on Wednesday. That means CEO pay grew 127 times faster than worker pay.

Income inequality between CEOs and workers has consequently exploded, with CEOs last year earning 209.4 times more than workers, compared to just 26.5 times more in 1978 -- meaning CEOs are taking home a larger percentage of company gains.

As pointed out in Ms. Patton's article numbers from the American Federation of Labor  suggest an even greater disparity,
McDonald’s is part of a larger trend of Standard & Poor’s 500 companies, according to data from the American Federation of Labor-Congress of Industrial Organizations. The pay gap between the average S&P 500 CEO and the average U.S. worker, which was 42 times in 1980, widened to 380 times in 2011 from 325 times in 2010, the umbrella group of 56 unions said.
Regardless of what numbers you look at the disparity between CEO and worker pay is well beyond obscene. It is positively immoral. And we know that the economy would not suffer, but rather would see greater prosperity, if the inequality was reduced to levels that existed thirty or forty years ago.

Beyond the numbers this disparity has a real face and that face is exemplified by Mr. Tyree Johnson.

A pay stub of Johnson’s shows that he earned $8,518.80 through Sept. 9 this year at the store that gives him most of his hours. He was able to work only 52 hours during the two- week pay period ending that date because the restaurant was being remodeled, he said. A statement of earnings from his other McDonald’s job shows that he worked fewer than 12 hours over two weeks, earning $95.45 before taxes.

* * *  *

Johnson begins most days the same way: picking cigarette butts out of the shower drain of a shared bathroom, using a tissue so he doesn’t touch them. While there’s a “No Smoking” sign posted inside the hotel where he lives, that doesn’t stop the other occupants who share the showers, sinks and toilets.

His rent at the hotel in Chicago’s Uptown neighborhood is $320 a month. Johnson usually can’t cover it all at once, so he’s allowed to pay $160 every two weeks, or even $80 a week, for his first-floor room. He’s late on November rent and owes about $100 -- some of it a late-payment fee, he said.

Originally posted to September 17, 1787 on Wed Dec 12, 2012 at 12:37 PM PST.

Also republished by In Support of Labor and Unions.

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