Fast food industry contributes to homelessness in California, says new report.
By Ethan Ward for Capital & Main
Fast-food workers represent a startling portion of California’s unhoused population, making up 11% of all unhoused workers in California, 9% in Los Angeles County and 8% in the city of Los Angeles, according to a new report on the intersection of poverty wages and homelessness.
The authors of the report, published by the Economic Roundtable, estimate that there would be 10,120 fewer unhoused workers in California, 3,595 fewer in L.A. County, and 1,889 fewer in the city of L.A. if the fast-food industry provided stable employment and paid workers enough to maintain secure housing.
Daniel Flaming is president of the Economic Roundtable and co-author with Patrick Burns of the report, “Hungry Cooks: Poverty Wages and Homelessness in the Fast Food Industry.” Flaming said the organization looked into the connection between income, jobs, and homelessness after data from the Los Angeles Homeless Services Authority showed that over half of unhoused people who were surveyed said their biggest struggles were tied to a lack of work and affordable rent.
The fast food corporations are “flourishing, and they are poverty entrepreneurs. They are economic bottom feeders in terms of the labor force,” said Flaming. “The easiest, most cost effective and responsible solution is for these corporations to pay sustaining wages for workers. This is probably the biggest single thing that we can do to reduce homelessness.”
According to the Economic Roundtable report, California’s unhoused population grew 51% from 2014 to 2022, and that growth would have been significantly diminished if the fast food wage floor was adequate to ensure workers could afford stable housing.
Much of the report underscores statements by L.A. Mayor Karen Bass, who has made homelessness her biggest focus since taking office. Her proposed 2023-24 budget dedicates $1.3 billion to address the crisis. Inside Safe, the mayor’s initiative to reduce street homelessness and bring people indoors, has housed about 1,000 people so far.
The median annual earnings of California’s front-line fast food workers were $14,949 in 2020, and over two-thirds of them were paid less than $20,000 a year.
Flaming said that while programs like Inside Safe offer immediate help to people living in encampments, permanent solutions involve building affordable housing. That will take decades.
For now, “A bigger fix would be helping people who are out there working,” he said, meaning the roughly 10,000 unhoused fast-food workers in the state. The median annual earnings of California’s front-line fast food workers were $14,949 in 2020, and over two-thirds of them were paid less than $20,000 a year, the report reveals. What’s more, the poverty rate for the households of front-line workers is three times higher than the rate for the rest of the state’s workers.
Additionally, the report shows a disproportionate impact on minorities in the workforce. Latinos make up the largest share of California’s unhoused workers; African Americans make up the smallest share of unhoused fast-food workers in the city of L.A., but 13% of all unhoused fast-food workers in the state. The risk of homelessness is higher for African Americans than for any other ethnic group in California’s fast-food workforce.
These workers are more likely to experience poverty and homelessness, says the report, and Anneisha Williams, 38, is no stranger to either. Williams, who is Black, experienced homelessness for five years, three of which were spent moving between motels and family or friends’ houses. For two of those years, she lived in a shelter. “Every day I worry that will happen to me again,” she said.
In October 2020, Williams moved with five of her children into a two-bedroom apartment in South L.A. where she currently pays $1,730 a month. Her four daughters, between the ages of 3 and 14, share a bedroom equipped with a bunk bed and a single twin bed. Her 16-year-old son sleeps on the living room couch. She’s struggled to keep up with rent payments while making $16.04 per hour as a part-time shift manager at Jack in the Box, where she’s worked for almost two years.
When she started, Williams was paid $15 per hour as a drive-through cashier. She said she gets a minimum of 16 hours of work each week—20 if she’s lucky. The CEO of Jack in the Box earned roughly $4.6 million in compensation in 2022, while the median pay for its workers was nearly $19,800—a 234:1 ratio of CEO pay to median worker pay, according to the report.
“It’s stressful, it’s depressing. You try to keep a smile on your face because your kids don’t know what you’re going through.”
~ Anneisha Williams, fast food worker
“Being a single parent is a toll on me,” Williams said through tears. “I get the help from my grandmother, but I try to take care of all my bills myself. I’ve got to make sure I have tissues, paper towels, my hygiene stuff. I have to budget $20 per week for laundry.”
More than two-thirds of California’s fast-food workers are employed as cooks, cashiers, and food preparation workers. These workers are more likely to have children they support with their earnings than the rest of California’s workforce, with 44% supporting children compared to 35% of the general workforce, according to the report.
While she’s grateful for paydays, Williams says they are also often stress-inducing. When she picks up her check from work on Fridays, she thinks to herself, “Damn, that’s it?”
Her circumstances have taken a toll on her mental health. “It’s stressful, it’s depressing. You try to keep a smile on your face because your kids don’t know what you’re going through,” Williams said. “They think it’s all glitter and gold, and I want to keep it that way.”
Williams said that despite the challenges, she loves her job because it allows her to use a skill she’s been proud of since she was a little girl—talking. “I like the people,” Williams said. “I like my customer service. The joy of making somebody else happy and to know that I’m able to feed the next person’s family. You have to be able to love doing what you do. If you go to work not loving what you do, you’re gonna do a shitty job.”
She disagrees with the idea that fast-food jobs are just for young people in high school. “These kids will fold under pressure,” Williams said. “[Fast food businesses] need the backbone of an older person who is more knowledgeable on the floor. Some of these customers can get a little vicious.”
Flaming, president of the Economic Roundtable, said it is “unforgivably arrogant” for people to think a fast-food job is transitional employment. “These are people who do the basic heavy lifting that make our world go around,” he said. “They change our tires, they build our houses, they make our food. They are parents, they are good neighbors. This has been their life’s work. There ought to be dignity of work and it ought to be sustainable.”
“One of the easiest ways for local operators to cut expenses and have a profit for themselves is to not pay the workers very much.”
~ Daniel Flaming, president, Economic Roundtable
The new report proposes solutions that would help foster sustainability. They include allowing workers to organize and have a voice in setting industry standards; bringing together corporate executives, workers, and government regulators to establish industrywide pay and scheduling standards; and requiring corporate brands to help local franchise operators provide wages, benefits, and scheduling that enable front-line workers to afford housing, food, and health care.
Others, too, are increasingly interested in keeping a roof over the heads of fast-food employees. The California Legislature is currently weighing Assembly Bill 257, which would set industry standards for wages and working hours. The bill was signed into law in 2022, but is facing pushback from a coalition of restaurant and business groups sponsoring a referendum on the California ballot in 2024 that offers voters a chance to overturn the bill.
Flaming said that parent companies have contracts with franchise owners that require a percentage of the revenue regardless of whether the franchise is making a profit. “One of the easiest ways for local operators to cut expenses and have a profit for themselves is to not pay the workers very much,” Flaming said. But he adds that corporations have a responsibility to make the system work for franchisees.
Parent companies have the money to make it happen. According to the Economic Roundtable’s report, the top five publicly traded fast-food corporations operating in California generated $14.5 billion in profit in 2021 and $12 billion in 2022.
That’s why I fight so hard,” Williams said. “That’s why I’m an advocate for fast-food workers. We deserve this; it’s not like we’re being lazy on the job. We’re working for a company that can actually give it to us.”
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