Painfully obvious too. My little local Mexcian place will be closing down because of a lack of cooks. Talking to the owner, he was complaining about government benefits, and how they all want $20 an hour.
I don't understand it, that you'd either
a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or
b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you.
You're presenting it as he has an infinite money supply and just of pure stupidity and greed doesn't want to pay $20 or $50 per hour. Maybe his supply is not unlimited, and maybe nobody would buy a taco for $50 and he knows it, and he made the calculation and decided there's no way to pay all his costs, charge the price that people would be willing to pay, and make a profit.
Now, if you know how to do it, there's a big opportunity for you just opened up. You could buy the place (probably for cheap), hire the cooks for $20 or for $50 (they would be ecstatic to work for you, I am sure, you're not that previous greedy owner and would pay them lavishly) and become the model of a businessman. People love good Mexican food. I know I do. I know many people that do. You can't lose, really - it's a mystery why there aren't more Mexican food billionaires... It's so simple, after all.
Somehow most of such attempts I've heard of never turned a profit and shut down soon. Maybe those restaurant owners know something about their business that is not obvious to a random person only reading newspaper headlines...
Christ, people here and their taller than standard horses. My girlfriends dad owns a pizza place and walked away with $5k last year, after paying rent, supply and wages. Where do they magically pull this money from? They aren’t evil banker types with bags marked “$$$” full of money like people here seem to think and it is disgusting they’re considered cheap instead of just “people will absolutely not pay the increase in price” to pay for these wage increases. This man is one of the most hardworking and honest people I’ve met, as opposed to the people I meet working in tech.
This is market forces at work. There is not necessarily someone to blame, generally speaking. I expect we'll see prices going up, wages going up and margins going down. I think that is good since I think we have gone too far in the other direction.
What frustrates me about economics (with my one intro class level experience) is that they could only talk about equilibrium. The dynamics of things changing like this is what would be really interesting.
Depends on how you look at it. If the owner has 10 restuarants, and is making $750,000 per year, let's say, then he or she does have an unlimited amount of money, compared to the workers, especially if the workers are making the federal minimum wage of $7.25.
If they have a small mom and pop company that cannot pay workers at least $50,000, then they need to go out of business. Then, as more and more shops go out of business, then there will be less of a supply and then the company can demand more money from customers and pay their workers more. Except, the reality is that the owners WILL make more money, but still won't want to pay their employees more, and will give the same line - that that type of labor is unskilled and f-ck them, which means more money for the owner. That's the reality. And if true that the labor is unskilled and the owner shouldn't pay more, then the workers should not come back to work.
All the Wall Street journals and pro-business journals and business videos have mouth noises that people don't have to accept the wages and it is voluntary work. But, when it actually happens, the cry like a bunch of little babies and say that the worker is at fault for not wanting to work for no insurance, shitty wages, and not being able to afford housing. Well, let the business owners do all of the work without workers, and get all the money. Sounds good to me.
You like your Mexican food, but only want to pay .89 cents for it? Good. You go grow the beans, grow the wheat or corn to make your own tortillas. Buy and milk your own damn cow in order to get the beef and milk the cow to make sour cream, and grow an avocado tree to make your own guacamole.
It's ok. Do it yourself. Let all the cheap restaurants go out of business. Deal with it.
And that the story. That's the REAL story, not the one that you are making up.
However, there might be a solution. If a business shows me all their financials, ALL of them, and the personal financial statements, and if I see that they are not making a lot of money, that's fine, maybe I will work for them. But if I see that they have 10 restaurants and make $750,000 per year, well, f the f out of them. But, business owenrs, show me your financials. You don't want to? Fine. Do it yourself. But I'm not going to work for $18,000 with zero benefits, while you're making $750,000. You say your contributions is worth more? Good. Do it yourself. I, and everyone else, don't accept that wage anymore, so do it yourself and go out of business, and you won't get that $750,000 per year anymore anyways.
>Maybe his supply is not unlimited, and maybe nobody would buy a taco for $50 and he knows it
Not true.
>While Chipotle raised wages from $13 to $15 an hour, or 15.4%, menu prices, on the other hand, were hiked between 3.5% and 4%. Price increases are generally quite small relative to the increase in workers' wages.
>he knows it, and he made the calculation and decided there's no way to pay all his costs, charge the price that people would be willing to pay, and make a profit.
How does he know for certain? He never even tried raising prices.
> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you.
This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same.
Of course, the alternative is to pay more and then raise prices. Which you might not be able to do if the additional cost is imposed only on you, but when your competitors have to pay it too, you all raise prices without losing business to each other.
But the overall industry would still lose some business to customers not being able to afford its products, and some of the suppliers still go out of business.
Unless the labor costs increase generally instead of only for that industry. Because then your customers can afford the higher prices. If labor becomes a higher percentage of operating costs overall, they may even be able to afford more than before. This is why a UBI is good for businesses -- customers have more money in their pockets.
This is a purely economic argument which if fine, but misses the vital non-economic side-effects. More money could lower the stress of the employees (given they now no longer have to worry about paying their bills) which may lead to higher quality products. Increased wages may attracts better talent or more exploitation conscious consumers. Hell, it may even more the owner more likely to listen to his staff, given that they become a significant expense. That could increase efficiency.
We should be careful not to make wage depression some sort of abstract "logical" natural state. Wages are low for a reason and active effort has to be expended to keep them as they are.
But competitors are already in the same boat. Demand for business is high.
I really think that some of this is about class solidarity among business owners (especially small business owners). I say this as a political centrist, too.
There are a bunch of reasons why wages are "sticky" (i.e. they don't go up--or down--when you'd expect that to be the rational decision in an efficient market), and this is probably one of them.
Also, there are ways to seek out higher efficiency. Hire at higher wage but expect and prepare for higher productivity. Operate the business for longer hours to make the most of money paid for rent, etc. Unfortunately, I think small businesses where I live (in southeast Virginia) are much worse at this than larger businesses.
The dirty open secret about development is that in highly developed countries with low inequality, human labor is just horrendously expensive, and since dining out has costs dominated by human labor, even relatively wealthy people dine out rarely.
Ask the Swiss or Danes. Cooks can have a living wage, but fancy meals are comparatively much more expensive than their equivalents in the US, given their lack access to underpaid immigrants for that kind of work.
If everyone's wage goes up, the economy is probably running hotter and there is more growth. Don't forget the macro side if things!
A lot of well-credentialed people will say "bu- but the 1970s", but the fact of the matter is the wage share of income could also change, and rather than knee-capping unions to control inflation, we could have done price controls (as was done in the 1950s), profit controls (which would limit dividends and buy backs, not reinvestment to boost supply) or other such things.
Claims like this about UBI are simply unknown. You can't say it with any certainty, not even close. To begin to have UBI you'd have to increase taxes substantially, and you'd have to prove that doing that would actually lead to better results for businesses and the people.
> This is why a UBI is good for businesses -- customers have more money in their pockets.
I'm a proponent of UBI and I think this claim needs a citation for the level of certainty that you expressed. I have always viewed that UBI will likely be bad for small businesses, but that by the time that we need UBI there won't be many small businesses left.
There are two pilots of UBI worth paying attention to: Finland and Ontario. Finland proposes paying the unemployed (this differs slightly from unemployment benefits in the US) while Ontario proposes paying anyone below the poverty line.
That said, it was not enough to impact small businesses in a positive way. Over 50% of small businesses reported having a large negative impact. There's lots of questions to be answered there, like the availability of non-extractive technology for small businesses to use to compete, and where the income levels where UBI-like income disbursements were centered actually spend their money.
> Estimates from the weekly U.S. Census Small Business Pulse Survey indicate that roughly 50% of businesses report having a large negative effect from the COVID‐19 pandemic and that only 15%–20% of businesses have enough cash on hand to cover 3 months of operations (Bohn, Mejia, & Lafortune, 2020; U.S. Census Bureau, 2020).
Not to mention your competitors may be switching to robots, greatly reducing their labors to the point it might not be competitive if you're using humans and don't have the capital for the robot.
I have always hated the idea of UBI in any for it has been presented so far. Money means nothing if the price of everything shoots through the roof. Just yesterday I paid $9.50 for bacon where a year ago it was closer to $5. Let’s not even get started on shrinkflation of items. Back to my point though we don’t need a ubi but a right to food shelter and water. Anyone who has been poor knows something will eat up this check and you will be no better then before. It may not happen right away but there are too many predators looking for your money. I don’t know how you could give everyone the right to food, shelter and water but that is what we need.
> a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or
>
> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you.
Restaurants run on notoriously thin margins ( https://upserve.com/restaurant-insider/profit-margins/ ). There's a reason restaurants often fail even in good economic times: even small miscalculations or mistakes can put a good restaurant out of business.
Maybe we need buffet-style restaurants that serve nutritious perishable food without all the extra plating, waters, and other frivolities so people can bask in being served and pretend they are aristocracy.
Everyone cooking is a massive inefficiency, and yet paying for conventional restaurants is also uneconomical. Eating shelf-stable food is cheaper than cooking for most people, but only until the bad health effects catch up. Just like global warming, the market can only optimize over small time horizons without politically pricing in externalities.
Same with a bundle of Great Clips a friend manages for a franchisee. Can’t find staff, doesn’t believe staff are worth what the current effective minimum wage is.
“Have you tried offering more?” “That’s too much for cosmetology work.”
Getting slapped by the invisible hand of the market.
If bread costs more than I would like, it's not a shortage of bread, it's just the bread being more expensive than I would like it to be. Exactly the same thing about labor. There are many people looking for a new job, and if you make it known that you pay more than they have now, some of them will run to you.
I have seen software companies making a similar mistake. Of course, the salaries there are way above the minimum wage, but still the same logic. They complain: "We wanted to start this new project, but we can't find developers; we have been posting job announcements online for five years already!" I look at the job announcement, it offers about 2/3 of the market salary. "Have you tried offering more?" Blank stares. I guess, how could that possibly be relevant?
Maybe the problem is that the employers see employees as "the ones who obey", which is generally true... except for the job interviews. There, you cannot simply give orders and expect them to be obeyed. The candidate will only take the offer if they like the proposed deal. Also, for the ones who accept, you can gradually make the deal worse, by increasing the workload and keeping salary the same regardless of inflation... until the surprising moment when the employee decides to walk away, because they got a better deal somewhere else.
The government paying people to not work has nothing to do with this oft-misunderstood "invisible hand" metaphor.
I'm not sure why people think that a barber is somehow able to compete with the infinite resources of the government hellbent on idling labor capacity. Very few rational people will work for 25/hour if they can sit and watch TV for 20/hour. Saying "pay more" is not helpful in that situation. The labor pool is basically limited to those who have enough foresight to realize the gravy train might end.
It’s easy to understand. If your customers won’t buy Mexican food at a high enough price to pay $20/hour, it’s better to close than to stay open and lose money.
Labor is the highest cost for a restaurant (higher than rent) so bumping wages from $15 to $20 may not be possible if you can’t also raise prices by 30%.
This may be hard to understand for us rich programmers. But it’s quite simple for companies that have really stiff price competition.
You dont need to increase prices by 30% to raise the hourly rate from $15 to $20. Pay is like a fixed cost. If your cook makes 100 items an hour and you profit 1$ off each item. Your profit for the hour only goes down by $5 not by 33 cents per item
McDonald's pays about 20% in labor costs, and from what I can see other restaurants also average 20-30%. Where are you getting that labor is the highest cost?
> It’s easy to understand. If your customers won’t buy Mexican food at a high enough price to pay $20/hour, it’s better to close than to stay open and lose money.
I think the root problem is that most restaurant dining experiences are not worth the $30+ per person for enough people compared to cooking and eating at home.
I would like to see more places where you order at a register and bus your own food with minimal overheard and maximum investment in the quality of the food rather than the whole waiter and ambiance schtick.
I heard a hotel guy being interviewed on NPR afew weeks ago and he basically said raising wages was not an option because other places will just raise their wages too and it won't let them stand out. So he'd rather encourage tipping from customers.
The owner won't hire a couple of cooks at $20 an hour because he won't be able to pay off his mortgages anymore. The banker sits behind all this and collects his fat percentage cut while laughing at the plebs fighting with each other over scraps.
We have a 3 tier system: minimum wage workers condemned to a perpetual state of precarity, middle class professional and small business types that toil away paying hefty mortgages one medical emergency from bankruptcy and capital owners that lend around money at extortionate rates and run to the nanny state to print money and save their skin whenever their bets go sour. Guess which strata gets most of the flak. Tip: it's not those at the top.
> capital owners that lend around money at extortionate rates and run to the nanny state to print money and save their skin whenever their bets go sour. Guess which strata gets most of the flak.
Your heart is in the right place, but you are doing the devil's work by accident. "extortionate rates" and "printing money" do not happen at once! We have low interest rates, which are good for debtors. The banks now will get very little interest on those mortgages, so that can't be the sole piece of they are making a killing.
What also happens is low interest loans allow the value of land to go up, and land speculation works too well. Worse, there are laws and other things preventing density so the desire to have as many tenants as possible doesn't actually reduce the cost of floor area.
The thing about being a business owner, is that you are the last one on the payroll (if you are a good owner).
All the bills get paid (including wages), then you get what's left over. If you had a good week, then you get a nice stack of Benjamins. If you had a bad week; maybe not so much. In fact, you may even need to chip in, to keep the lights on.
I have seen, many, many SMB owners start living "high on the hog," as soon as they start doing well. They buy a 5-bedroom house in a marqée neighborhood, a C-class Merc., LV bags, etc. I know, for a fact, that most of them make far less than I ever did. Frequently, they get the company to pay for a lot of it (put one bullet in the chamber, and give it a spin).
They have gotten used to living large, and it's damn difficult to downsize, after that.
So that means they need to do everything they can, to make sure the last pile is as big as possible; regardless of how the corporation is performing.
If they banked on hiring undocumented workers, or skilled artisans at rock-bottom prices, and that pool dries up, they are left with the choice of leasing a Subaru, and selling the Jag, or trying to make whoever has been loyal enough to stick around, fill in the gaps.
There are a lot of businesses on the brink. My regular Italian spot went out of business in the depths of the pandemic. They re-capitalized and opened again but with higher prices. Their clientele is upper middle class (i.e. relatively price insensitive). But they still wrote a long letter explaining why prices increased (more benefits, more salary) and asking that people support their increased overhead by becoming regular patrons. I think operators are really scared people will judge them on value if the price goes up.
It's one approach. A bit carrot-and-stick, but what I have seen in restaurants in upper class neighborhoods is chastising changes to public policy. Each menu page has a footnote mentioning there's a X% charge (that isn't the tip) applied to each menu item due to a rise in minimum wage.
Since they re-printed the menus anyways to add the footnote, they could have simply been more transparent and increased each menu item's cost. Most people regularly dining at fancy ocean-view restaurants (which I rarely frequent) can afford the higher cost.
Is it working for them? I get the feeling that it might, depending on the price level they were at previously. Perhaps the thing to do would have been to rebrand completely, make the place look a bit more fancy.
The only way to avoid shutting down would be to raise prices, right? What if the owner knew customers wouldn't pay higher prices because he has tried to raise prices many times before and knows that it turns customers away?
That rock-and-a-hard-place choice is often what happens when a business dies, right? You live between your costs and your income. This may just be the business version of the 9/11 falling man.
It may well be that the market for food places in your area cannot support the current set of outlets, and some of them will have to die, and this is how they die.
The way I think about it is there's a metastability in the economy that's not often discussed. Basically, unviable business models can survive small disturbances. One chef gets fed up, no problem. One customer think it's too expensive for what he gets, no problem. When there's a big shakeup, it all comes crashing down.
A cultural shift may mean that people collectively decided that they will, for example, spend 8% of their income on eating out rather than 12%. That represents an aggregate decrease in demand and would indicate a negative sum game (something most of HN seems incapable of comprehending)
The margins tend to already be razor thin. It is strange that they weren’t willing to try experimenting with higher wages and less employees. Maybe they’re already too overwhelmed from the pandemic to continue? The perception that not a lot of people are willing to pay for higher priced Chinese and Mexican foods factored into the decision?
Restaurants, Fast-foods and bars are already quite expensive. That's why they are competitive: customers are very sensitive to price, and have limited budgets. It's like airlines.
Raising the prices would not work. If it did, some of them would have already done it.
Prices can be very, very sticky? In my city it appears (to my uninvolved eye) that several levels of floor space sublessors need to run out of lessees by raising prices in order to pay (possibly their debt to) the higher levels, with a couple months’ latency for each, until retail can reasonably exist again.
I've read that food margins have been extremely thin for many years - well before the pandemic. Maybe the owner is just tired of working his ass off for not much in return, and staffing problem is just the straw that broke the camel's back.
Maybe the owner would be better off with unemployment!
Yeah because you clearly understand his entire financial situation and profit margin to justify that cost right? How are you so sure customers pay the higher food prices? People think small business owners are swimming in money, and that’s just not true.
Restaurant margins are very thin. The extra 20-50$/hr is literally the owners salary for running the business. Why do you think they will continue to run the business making 0$ ?
Amazing is the cognitive dissonance on display. The business owners one and all took the PPP loans which were essentially grants, and that was OK, but when it's for the workers it's destroying their predatory businesses. And they would rather close than make less profit to pay a living wage. We already get no healthcare and no retirement. How much further down can we be pushed?
It’s not an additional $20-50 an hour it’s the doubling of their single biggest expense in a sector known for extremely thin margins at a time where all of their supplies are also shooting up drastically in price.
What makes it obvious that this is a worker’s rights or wage gap? Aren’t people able to demand higher than normal wages or simply not work because they are propped up by a host of COVID measures like stimulus payments and eviction moratoriums? That is skewing the market and being used to push for higher compensation. It’s not much different from cheap money supply at low interest rates increasing the price of assets.
When you’re used to pay little amounts of money for things, it takes time to rewire your mind. I remember being upset at chocolate or cheese prices when I moved to California for at least one or two years.
One has to have a rudimentary understanding of business in order to understand the realities of a forced high minimum wage. Restaurants and manufacturing operations can’t do not operate in a distortion field where external realities do not matter.
In the case of the restaurant, what they are able to charge for their product is governed by myriad variables, some of which are: location, competitive landscape (how many, distance, kind, etc.), audience dynamics (breakfast and lunch crowd or spread across the day and evening), etc.
Competition drives both prices and margins down. Once an area has reached price stability, it is very hard to raise prices. So, you are selling a burger for $10 and, if you are lucky, you make $2 to $3 on it. Depending on the nature of the organization, delivering burgers might require 5 to 10 people.
Along come politicians pandering for votes and push for a 50% increase in minimum wage.
This increase causes a chain reaction through the entire wage structure. The guy making $10/hr now makes $15. Someone making $15 makes $20, and so on.
Most people don’t stop to do a bit of math and understand reality before accusing business people of being evil, greedy, or both.
What ends up happening is that the thin margins and realities of the market can’t support the delta in cost structure. The business either controls costs or shuts down.
How do you control costs?
Less people doing more or less people and automation. A few more options, but that’s the basic idea.
In other words, the politicians get the votes and continue on their sweet power ride. Those who voted for them lose their jobs. A bunch of the businesses who created jobs shutter. Fantastic deal, isn’t it?
I am in the process of setting-up a manufacturing operation to produce up to 100K of our products per month. We want to manufacture in the US. The ONLY WAY this is even remotely possible is through automation. We are explicitly designing both the product and the manufacturing process for as close as we can get to lights-out manufacturing. We cannot afford hordes of people at $15/hr. The only alternative is to go to China, Taiwan, Mexico or other shores. That’s the reality we have created for ourselves through what I can only describe as ignorant voting decisions that only benefit politicians.
Everything we use in manufacturing comes from China. We can either understand this reality and think of creative way not to lose even more job-generating industries or we can continue to be led by the nose by politicians with no skin in the game and one day wake up and think “What happened?” without realizing we did it to ourselves.
I am not in the Restaurant business, so I don't know how many meals they typically sell, or how much they charge.
Let's say he pays his cooks 30$ more. How long are they open, how many people work in the kitchen? Two people, 12 hours? So that would be 720$ more per day.
How much do they earn per meal? In my country in most restaurants charge around 10$ for a meal. Even assuming no costs for the food resources, that would mean 72 more meals to sell, per day.
Most restaurants operate on very slim margins. That's why many smaller financial institutions do not risk commercial loans on them unless they've been established for a while or it's guaranteed by an SBA loan which heavily minimizes the financials risk.
Honestly I feel like most people would pay it. It seems to me that everybody just accepts you pay like 10x the price of what you could make something yourself as reasonable. I don't get it and it irks me that we even need to participate in this facade that we're all some sort of royalty class that are entitled this.
Something inexpensive that enables people to pay for not going to the effort to cook relatively tasty food exists everywhere that’s large enough to support the overhead, since before the modern times. It doesn’t have to be particularly good or healthy, but it does exist. In some European cities supermarkets just sell packaged premade salads and pasta, for example.
Personal service might be more expensive overall, but I’m not ready to immediately declare that obvious just because the people behind it are visible to the buyer.
As someone who makes their living owning a food business, nearly all the food industry-related comments here are off the mark. Rather than rebut any of them, I'd say the way to think about that particular set of industry challenges is to think of them like a chronic condition.
It's never a "just do this" answer. Never. You don't tell your friend with depression to plow through this down phase he's in. And the other friend with Crohn's disease and a colostomy bag doesn't benefit from someone suggesting she try a gluten-free diet.
It's the same in the food industry. The issues at hand are complex, the ripple effects of any change are significant and multifaceted, and the foremost issue today may be superseded tomorrow while nonetheless remaining an area for concern and attention.
The better move from the outside is to provide the support that's needed today by the business (or the friend) and within your means. Can't afford to go out for food regularly? I get it, just like your job may not allow you to be available as often as your friend with Crohn's disease needs a ride home from the hospital after some procedure.
But also, unlike having a friend with a chronic disease, it is no one's obligation to support particular local businesses with their time and money. Yes, supporting local businesses in general is good, no question—but I feel like framing it as "just give the support you can to your local restaurants" implies a greater onus than can realistically be placed on regular people.
It's surprising businesses haven't turned to automation.
At the very least, most of a restaurant's and a coffee shop's labor can be replaced with automated ordering, having the customer collect food themselves when it's ready, and using robots to prepare more of the food. they can do lattes with art all by themselves now.
A lot of these businesses just can't survive if they meet the wage demands of people who have benefitted from substantial stimulus over the last 2 years.
Automation would increase the quality of their service and reduce costs in the long run. I keep hearing about how much workers hate these jobs, so they should be happy to see them go away.
Edit: every example I gave above has been observed successfully in action. They just haven't been widely deployed enough to become a norm.
Other jobs that can be replaced:
- host -> seat yourself sign
- server -> pager, bus your table, ordering tablet (with just ordering, don't put ads and games like they did 5 years ago)
- barista -> robot/dispenser tech can manage several facilities simultaneously
- retail/grocery -> see what Amazon is doing
- cleaning/janitorial -> robots and more innovative cleaning apprpaches could save a lot more effort. Japan has self-cleaning public toilets.
> At the very least, most of a restaurant's and a coffee shop's labor can be replaced with automated ordering, having the customer collect food themselves when it's ready
Automation, automation, digital transformation, sure we can do it all. But in many cases it makes things suck a bit more, and life crappier overall.
If I go to a restaurant a real person taking the order is part of the ambiance and expected service. You pay for it (maybe not in USA though).
At the last place I visited some guy dropped a tablet on the table. It said 'Next-gen Restaurant Experience' at the back. We got to fiddle a long time to type our 6-person order in. Crappy. Last time I visit there.
> retail/grocery -> see what Amazon is doing
They facilitate rat-race shopping. No more small social chat at the PoS with employees that know you. Just in and out, and back to work.
We this kind of automation every time we lose small social interactions that are important in a healthy society, imho.
I think it really is highly dependent on the individual. For your example with restaurants I have the absolute opposite preference. When I go to a restaurant I'm usually dining with friends so the social aspect is already covered - I don't want/need to make small chat with a waiter.
Would be completely happy with an automated process there, for my mind that means more of my tip might go to the cook who is actually preparing my food in the first place.
>If I go to a restaurant a real person taking the order is part of the ambiance and expected service. You pay for it (maybe not in USA though).
>At the last place I visited some guy dropped a tablet on the table. It said 'Next-gen Restaurant Experience' at the back. We got to fiddle a long time to type our 6-person order in. Crappy. Last time I visit there.
I'm definitely okay with fiddling with a tablet if it meant I didn't have to pay a 15% tip.
>They facilitate rat-race shopping. No more small social chat at the PoS with employees that know you. Just in and out, and back to work.
The amount of "small social chat at the PoS with employees that know you" I see happening (ie. when waiting in line) is approximately zero. In that case, the loss is zero.
You're greatly overestimating the reliability of such technology and greatly underestimating the costs of it. There's a reason automation has not replaced these roles, it's simply not (yet) capable or cost effective. Source: I worked for a startup that built restaurant automation solutions and witnessed first-hand how difficult this is. It'll get there some day, but we're a long ways off.
I'd stay at home if going to a restaurant was like you just described it. Also, you, and many people, seem to forget that the role of the economy is to provide for the people, not the other way. If you automate everything without providing viable solutions you're just pushing people to shitier jobs over and over.
If going to a coffee shop meant going to some sort of self service machine, pushing a few button and getting a machine made Nespresso pod coffee I'd just stay at home and save the money....
What's the end goal of all this ? Automate everything, skip all human interactions, destroy every small restaurants/coffee shops ?
This "automate everything" attitude is so weird, almost like some people want to dehumanise humanity. You know what would be the absolute automation, providing the best experience for everyone, for the least amount of energy spent ? Being in a coma in some form of pod, fed artificial thoughts and food/oxygen through tubes.
Automation only make sense if it delivers us from work, not if it pushes people into worse positions.
As far as humanity is concerned, perhaps it is uniquely human to bitch about low paid service jobs (even when they aren't all that low pay) while also bitching about those jobs no longer being necessary. If the labor I interacted with regularly took their jobs seriously and had good customer service skills, I wouldn't be so quick to cut them out of the picture. Unfortunately my experience is that at least in the US, the culture of work varies wildly by region, and most of them aren't all that good for the consumer.
The economy doesn’t exist to serve “the people” (referring to a specific class), it exists to serve “people.” That number of people being served can very well grow or shrink over time. The existence of automation doesn’t guarantee it is strictly decreasing; consider the automobile industry for example, which created millions of jobs.
The problem with this is, if the barista gets automated, the customers buy better coffee machines and stop going to the cafe.
An exaggeration, but you see my point perhaps. Unless your service is really purely about bang for buck, trying to automate it in ways that are visible to the customer can have downsides. McDonald’s could probably go full robotic. Starbucks? Not sure, maybe. It would be a little offputting. Your local (good) pizza place? Not likely.
This is not my experience. Watching Starbucks and my other local coffee places implement app/cashier less ordering it seems like more customers and more purchases.
Ordering on my phone while I’m the way is easier than talking with a human. And easier to add stuff on.
I’ve never considered buying an espresso machine and bypassing my local coffee place.
Similarly, I wish all fast food went cashierless. The cashier is the slowest and most error prone part of the process.
I don't see your point at all - most people that I know including myself who go to a coffee shop go to be able to sit down and relax for a few hours and enjoy the atmosphere/ambience provided by the physical environment and other customers in proximity.
Depends. I don't go to a coffee place to hang out with the Barista. I go to hang out. may be with friends/family. I couldn't care who made my coffee and how as long as it is good. I love automation as much as possible.
I'm afraid I can't find the graph, but I saw something showing that food service revenue has fully rebounded since the pandemic while food service employment has not. That would imply that labor saving is already in effect. It would also be unsurprising that not every restaurant would handle it equally well.
Some of my favorite dine-in restaurants are still pickup only. I think they realized that they can make just as much money doing take out and a lot less people management now that there are no severs
Speaking purely about food service roles, as I recall, the minimum wage for tipped food services roles in some places is 2.13 USD per hour, made up to actual minimum wage if tipping doesn't reach that level.
Labour costs are, in many cases, really small; the capital and running costs of automation could well be comparable already.
Ordering automation is there with order-and-pickup apps like doordash and instacart, it's just they charge a fee that costs more than doing answering the phone typically, which is why restaurant owners tend not to like them.
Also those kind of seat yourself / serve yourself places exist, they're called fast food typically. Look at mcdonalds, chipotle or subway for example. That setup is actually very old, from the time before computers.
Places that serve alcohol like waiters although, because they are essentially alcohol salesmen that boost sales, and alcohol are big profit drivers for restaurants.
You must want to live in a frigid world bereft of human connection.
I recently went to a place that had no welcome/front end staff, just workers making a product (desserts) and a two kiosks at the front to take your order.
The kiosks interface was poorly made and confusing for a first time person. Worse, there was no sign telling me to step forward and order using the computer nor was there any sort of line to know who had already ordered and who were waiting to order. Over all it was a terrible experience and as such I don't plan on going back.
Might this be happening already? It seems like ordering at the counter is becoming more popular compared to full service, even for somewhat upscale food. Also, food trucks are popular.
As a parent of small kids, I really appreciate being able to pay while ordering as opposed to waiting for the waiter ( hmmm… ) while the children get antsy.
Of course, Now that I think about it, I’ve never asked if I could just pay after ordering. The force of habit, huh!
95% of the time, I prefer eating at restaurants with no waiter and where you pay up front for the food. So much time and money wasted on talking to someone for something that would take me 10 seconds to do.
Waited service is okay for special dates and business meals or something.
> most of a restaurant's and a coffee shop's labor can be replaced with automated ordering, having the customer collect food themselves when it's ready...
Which means "extracting free work from the customers", which is basically Marxism 101, "how to extract value from live work". My answer in such a place is to go straight out. I NEVER use the "automatic cashes", thank you very much.
> ... using robots to prepare more of the food. they can do lattes with art all by themselves now.
Robots are a sham, they're just a scarecrow to force workers into obedience. You'll replace more easily a lawyer with a robot than a toilet cleaner or a cook. Robots are fragile and horribly expensive. Good luck with that.
Just friggin' pay the people decent wages, for chrissake.
Robots are better at menial, repetitive tasks. No matter what you pay a cashier, they will never be better than an ATM.
Free humans to do menial work. I think it’s pointless to try to improve wages for these low end jobs.
Similarly with fruit picking. It pays poorly and is hard and dangerous. The solution isn’t to improve wages, but to automate. Humans shouldn’t be forced to do meaningless jobs.
So you never order anything from e-commerce websites because you have to enter your own order and payment information manually? Sounds like a stupid way to interpret Marxism.
This is also about healthcare, which is trickle-up economics. If workers and employers alike are not concerned about paying thousands a year for premiums, that would be a double benefit that would appear as jobs.
If the US can spend billions on fossil subsidies and trillions on military and foreign wars, it should be a no brainer to stimulate domestic the economy with universal healthcare.
>If the US can spend billions on fossil subsidies and trillions on military and foreign wars, it should be a no brainer to stimulate domestic the economy with universal healthcare.
The numbers you're looking at are too small. The war on terror cost $8 trillion in 20 years.[0] That's $500 billion a year. Divide this by US population (330M) and you get $1,515. How much healthcare could you buy for that per year?
And don't forget that even without the wars a lot of this money would've been spent on modernizing the military anyway.
Universal healthcare actually saves money. It’s a mistaken assumption that conservatives always pick the cheapest or most efficient option. They pick the one that’s cheapest for people with a lot of assets. Individual insurance is paid for mostly by the middle class; universal healthcare is paid by taxes, which means rich people contribute more than they benefit.
I want a news organisation to look at 10 jobs that cannot be filled and compare them to the broader market. As most of the unfillable jobs in my area seem to be manufacturing/outdoor labour that pay as much as retail (which seems a lot nicer) or jobs seeking experienced people at entry level pay.
The biggest joke about those manufacturing jobs is a lot of HR will filter you out if you don't have experience. Meanwhile no school trains or teaches you about how to operate a CNC milling machine. Technical colleges offer apprenticeship programs if you can find a place that will sponsor you. But then that circles back to not being able to find a company without experience.
The blue collar labor market is just a magnificent joke. I tried it for about 7 years of my life and they will literally only employ you if they somehow know you or you know someone else. If you're just a stranger, they won't even look at your resume. They don't even want to train on shit that in the 1960-1990's, they would take you if you weren't a total moron and could pass a drug test (if that even).
Modern HR has become a joke in this situation as well. Not only do they pretend like they add value to a company, but they filter out people who could easily be exploited for cheap simply because they don't have experience. Seriously, just hire a rando who seems vetted, make them do some bitch work and occasionally the main job duties. If they catch on, give them more, if not, get rid of them. It's like employers have become more risk averse than someone investing in CD's...
Here in the UK we had supervisor/management positions trying it on for 0 hour contracts and minimum wage for months, although they seem to have gotten the message now they're having to literally shut their doors because they can't get staff. Worst one I saw was night manager of a massive central hotel for minimum wage. I wonder if it's that people have wisened up to the "take on extra responsibilities for no pay because it will look good on your CV" bullshit.
Bearing in mind it's only really the last generation or so in the UK who have gotten used to not expecting things like double pay for a night shift, workers expecting to be paid about £10p/h for a bar shift finishing at 4am still isn't a bad deal at all
> I wonder if it's that people have wisened up to the "take on extra responsibilities for no pay because it will look good on your CV" bullshit.
My hypothesis is that a bunch of people in low-paid service jobs like this had their jobs cut under them by the pandemic and were forced to find alternative income streams. That was painful at the time, but now many of those people find themselves in a much stronger position to refuse the work.
If your company has trouble hiring, it's a signal that something is wrong with the hiring process and the company needs to change it. Maybe stop leetcode nonsense, maybe offer more equity. Your managers should spend time to figure out the root cause and fix the problem. If your management cannot figure it out, fire them first.
If your company has trouble retaining engineers, it's a signal that something is wrong with the work environment. It could be pay. It could be lack of promotions. It could be a lack of recognition for the amount of work they are putting in. Once again, it is the management's job to figure out the root cause and fix it. If they can't, fire your management first. Hire/promote people who can do something different.
It is quite clear that in a hot economy, a lot of employers will need to reevaluate if they have the right decision makers in the first place.
If there are a lot of interviewers like that FB guy on teamblind who just searches for the hardest question and fails everyone for the tiniest error because he's fed up with the interview process, then yeah, there are problems.
It’s been fun to see this play out at my current (self-destructing) company. A large percentage of senior engineers have left; rather than make changes, management is going about business as usual.
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I don't understand it, that you'd either
a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or
b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you.
He chose option A I guess...
Now, if you know how to do it, there's a big opportunity for you just opened up. You could buy the place (probably for cheap), hire the cooks for $20 or for $50 (they would be ecstatic to work for you, I am sure, you're not that previous greedy owner and would pay them lavishly) and become the model of a businessman. People love good Mexican food. I know I do. I know many people that do. You can't lose, really - it's a mystery why there aren't more Mexican food billionaires... It's so simple, after all.
Somehow most of such attempts I've heard of never turned a profit and shut down soon. Maybe those restaurant owners know something about their business that is not obvious to a random person only reading newspaper headlines...
What frustrates me about economics (with my one intro class level experience) is that they could only talk about equilibrium. The dynamics of things changing like this is what would be really interesting.
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If they have a small mom and pop company that cannot pay workers at least $50,000, then they need to go out of business. Then, as more and more shops go out of business, then there will be less of a supply and then the company can demand more money from customers and pay their workers more. Except, the reality is that the owners WILL make more money, but still won't want to pay their employees more, and will give the same line - that that type of labor is unskilled and f-ck them, which means more money for the owner. That's the reality. And if true that the labor is unskilled and the owner shouldn't pay more, then the workers should not come back to work.
All the Wall Street journals and pro-business journals and business videos have mouth noises that people don't have to accept the wages and it is voluntary work. But, when it actually happens, the cry like a bunch of little babies and say that the worker is at fault for not wanting to work for no insurance, shitty wages, and not being able to afford housing. Well, let the business owners do all of the work without workers, and get all the money. Sounds good to me.
You like your Mexican food, but only want to pay .89 cents for it? Good. You go grow the beans, grow the wheat or corn to make your own tortillas. Buy and milk your own damn cow in order to get the beef and milk the cow to make sour cream, and grow an avocado tree to make your own guacamole.
It's ok. Do it yourself. Let all the cheap restaurants go out of business. Deal with it.
And that the story. That's the REAL story, not the one that you are making up.
However, there might be a solution. If a business shows me all their financials, ALL of them, and the personal financial statements, and if I see that they are not making a lot of money, that's fine, maybe I will work for them. But if I see that they have 10 restaurants and make $750,000 per year, well, f the f out of them. But, business owenrs, show me your financials. You don't want to? Fine. Do it yourself. But I'm not going to work for $18,000 with zero benefits, while you're making $750,000. You say your contributions is worth more? Good. Do it yourself. I, and everyone else, don't accept that wage anymore, so do it yourself and go out of business, and you won't get that $750,000 per year anymore anyways.
Not true.
>While Chipotle raised wages from $13 to $15 an hour, or 15.4%, menu prices, on the other hand, were hiked between 3.5% and 4%. Price increases are generally quite small relative to the increase in workers' wages.
>he knows it, and he made the calculation and decided there's no way to pay all his costs, charge the price that people would be willing to pay, and make a profit.
How does he know for certain? He never even tried raising prices.
This is the default state of businesses in competitive markets. If you could do with less then you could charge less, and one of your competitors will start doing that to take your customers, so you have to do the same.
Of course, the alternative is to pay more and then raise prices. Which you might not be able to do if the additional cost is imposed only on you, but when your competitors have to pay it too, you all raise prices without losing business to each other.
But the overall industry would still lose some business to customers not being able to afford its products, and some of the suppliers still go out of business.
Unless the labor costs increase generally instead of only for that industry. Because then your customers can afford the higher prices. If labor becomes a higher percentage of operating costs overall, they may even be able to afford more than before. This is why a UBI is good for businesses -- customers have more money in their pockets.
We should be careful not to make wage depression some sort of abstract "logical" natural state. Wages are low for a reason and active effort has to be expended to keep them as they are.
I really think that some of this is about class solidarity among business owners (especially small business owners). I say this as a political centrist, too.
There are a bunch of reasons why wages are "sticky" (i.e. they don't go up--or down--when you'd expect that to be the rational decision in an efficient market), and this is probably one of them.
Also, there are ways to seek out higher efficiency. Hire at higher wage but expect and prepare for higher productivity. Operate the business for longer hours to make the most of money paid for rent, etc. Unfortunately, I think small businesses where I live (in southeast Virginia) are much worse at this than larger businesses.
Ask the Swiss or Danes. Cooks can have a living wage, but fancy meals are comparatively much more expensive than their equivalents in the US, given their lack access to underpaid immigrants for that kind of work.
A lot of well-credentialed people will say "bu- but the 1970s", but the fact of the matter is the wage share of income could also change, and rather than knee-capping unions to control inflation, we could have done price controls (as was done in the 1950s), profit controls (which would limit dividends and buy backs, not reinvestment to boost supply) or other such things.
I'm a proponent of UBI and I think this claim needs a citation for the level of certainty that you expressed. I have always viewed that UBI will likely be bad for small businesses, but that by the time that we need UBI there won't be many small businesses left.
There are two pilots of UBI worth paying attention to: Finland and Ontario. Finland proposes paying the unemployed (this differs slightly from unemployment benefits in the US) while Ontario proposes paying anyone below the poverty line.
Source: https://hiring.workopolis.com/article/universal-basic-income...
UBI-like concepts, like what was implemented by the US and other countries during COVID, do help recover us from a recession.
Source: https://www.businessnewsdaily.com/9649-universal-basic-incom...
That said, it was not enough to impact small businesses in a positive way. Over 50% of small businesses reported having a large negative impact. There's lots of questions to be answered there, like the availability of non-extractive technology for small businesses to use to compete, and where the income levels where UBI-like income disbursements were centered actually spend their money.
> Estimates from the weekly U.S. Census Small Business Pulse Survey indicate that roughly 50% of businesses report having a large negative effect from the COVID‐19 pandemic and that only 15%–20% of businesses have enough cash on hand to cover 3 months of operations (Bohn, Mejia, & Lafortune, 2020; U.S. Census Bureau, 2020).
Source: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7461311/
>
> a) be willing to drive your business into the ground serving a limited menu because you won't hire a couple cooks at $20 an hour, or
>
> b) have a business so close to the brink of shutting down that an additional $20-50 an hour will shutter you.
Restaurants run on notoriously thin margins ( https://upserve.com/restaurant-insider/profit-margins/ ). There's a reason restaurants often fail even in good economic times: even small miscalculations or mistakes can put a good restaurant out of business.
Everyone cooking is a massive inefficiency, and yet paying for conventional restaurants is also uneconomical. Eating shelf-stable food is cheaper than cooking for most people, but only until the bad health effects catch up. Just like global warming, the market can only optimize over small time horizons without politically pricing in externalities.
“Have you tried offering more?” “That’s too much for cosmetology work.”
Getting slapped by the invisible hand of the market.
Now a haircut is $50 and I no longer go, opting instead to cut my own hair w help from my girlfriend.
Maybe people don’t want $50 haircuts.
So it's not even an economic argument, "If I pay that I'll go out of business"? It's just a moral one, "They don't deserve that amount of money"?
I can't say I'm surprised, TBH.
I have seen software companies making a similar mistake. Of course, the salaries there are way above the minimum wage, but still the same logic. They complain: "We wanted to start this new project, but we can't find developers; we have been posting job announcements online for five years already!" I look at the job announcement, it offers about 2/3 of the market salary. "Have you tried offering more?" Blank stares. I guess, how could that possibly be relevant?
Maybe the problem is that the employers see employees as "the ones who obey", which is generally true... except for the job interviews. There, you cannot simply give orders and expect them to be obeyed. The candidate will only take the offer if they like the proposed deal. Also, for the ones who accept, you can gradually make the deal worse, by increasing the workload and keeping salary the same regardless of inflation... until the surprising moment when the employee decides to walk away, because they got a better deal somewhere else.
And to that I say: welcome to the club.
I'm not sure why people think that a barber is somehow able to compete with the infinite resources of the government hellbent on idling labor capacity. Very few rational people will work for 25/hour if they can sit and watch TV for 20/hour. Saying "pay more" is not helpful in that situation. The labor pool is basically limited to those who have enough foresight to realize the gravy train might end.
Labor is the highest cost for a restaurant (higher than rent) so bumping wages from $15 to $20 may not be possible if you can’t also raise prices by 30%.
This may be hard to understand for us rich programmers. But it’s quite simple for companies that have really stiff price competition.
You know society is doomed when a wage supporting a middle class lifestyle is deemed "rich".
I think the root problem is that most restaurant dining experiences are not worth the $30+ per person for enough people compared to cooking and eating at home.
I would like to see more places where you order at a register and bus your own food with minimal overheard and maximum investment in the quality of the food rather than the whole waiter and ambiance schtick.
Almost bent my steering wheel in rage....
We have a 3 tier system: minimum wage workers condemned to a perpetual state of precarity, middle class professional and small business types that toil away paying hefty mortgages one medical emergency from bankruptcy and capital owners that lend around money at extortionate rates and run to the nanny state to print money and save their skin whenever their bets go sour. Guess which strata gets most of the flak. Tip: it's not those at the top.
Your heart is in the right place, but you are doing the devil's work by accident. "extortionate rates" and "printing money" do not happen at once! We have low interest rates, which are good for debtors. The banks now will get very little interest on those mortgages, so that can't be the sole piece of they are making a killing.
What also happens is low interest loans allow the value of land to go up, and land speculation works too well. Worse, there are laws and other things preventing density so the desire to have as many tenants as possible doesn't actually reduce the cost of floor area.
All the bills get paid (including wages), then you get what's left over. If you had a good week, then you get a nice stack of Benjamins. If you had a bad week; maybe not so much. In fact, you may even need to chip in, to keep the lights on.
I have seen, many, many SMB owners start living "high on the hog," as soon as they start doing well. They buy a 5-bedroom house in a marqée neighborhood, a C-class Merc., LV bags, etc. I know, for a fact, that most of them make far less than I ever did. Frequently, they get the company to pay for a lot of it (put one bullet in the chamber, and give it a spin).
They have gotten used to living large, and it's damn difficult to downsize, after that.
So that means they need to do everything they can, to make sure the last pile is as big as possible; regardless of how the corporation is performing.
If they banked on hiring undocumented workers, or skilled artisans at rock-bottom prices, and that pool dries up, they are left with the choice of leasing a Subaru, and selling the Jag, or trying to make whoever has been loyal enough to stick around, fill in the gaps.
Since they re-printed the menus anyways to add the footnote, they could have simply been more transparent and increased each menu item's cost. Most people regularly dining at fancy ocean-view restaurants (which I rarely frequent) can afford the higher cost.
It may well be that the market for food places in your area cannot support the current set of outlets, and some of them will have to die, and this is how they die.
The way I think about it is there's a metastability in the economy that's not often discussed. Basically, unviable business models can survive small disturbances. One chef gets fed up, no problem. One customer think it's too expensive for what he gets, no problem. When there's a big shakeup, it all comes crashing down.
The average small restaurant owner makes ~$50K per year and has very little line of credit. So unfortunately it's a zero-sum game.
Increasing cooks to $20hr means reducing their own comp to $20hr.
A cultural shift may mean that people collectively decided that they will, for example, spend 8% of their income on eating out rather than 12%. That represents an aggregate decrease in demand and would indicate a negative sum game (something most of HN seems incapable of comprehending)
Raising the prices would not work. If it did, some of them would have already done it.
Maybe the owner would be better off with unemployment!
In the case of the restaurant, what they are able to charge for their product is governed by myriad variables, some of which are: location, competitive landscape (how many, distance, kind, etc.), audience dynamics (breakfast and lunch crowd or spread across the day and evening), etc.
Competition drives both prices and margins down. Once an area has reached price stability, it is very hard to raise prices. So, you are selling a burger for $10 and, if you are lucky, you make $2 to $3 on it. Depending on the nature of the organization, delivering burgers might require 5 to 10 people.
Along come politicians pandering for votes and push for a 50% increase in minimum wage.
This increase causes a chain reaction through the entire wage structure. The guy making $10/hr now makes $15. Someone making $15 makes $20, and so on.
Most people don’t stop to do a bit of math and understand reality before accusing business people of being evil, greedy, or both.
What ends up happening is that the thin margins and realities of the market can’t support the delta in cost structure. The business either controls costs or shuts down.
How do you control costs?
Less people doing more or less people and automation. A few more options, but that’s the basic idea.
In other words, the politicians get the votes and continue on their sweet power ride. Those who voted for them lose their jobs. A bunch of the businesses who created jobs shutter. Fantastic deal, isn’t it?
I am in the process of setting-up a manufacturing operation to produce up to 100K of our products per month. We want to manufacture in the US. The ONLY WAY this is even remotely possible is through automation. We are explicitly designing both the product and the manufacturing process for as close as we can get to lights-out manufacturing. We cannot afford hordes of people at $15/hr. The only alternative is to go to China, Taiwan, Mexico or other shores. That’s the reality we have created for ourselves through what I can only describe as ignorant voting decisions that only benefit politicians.
Everything we use in manufacturing comes from China. We can either understand this reality and think of creative way not to lose even more job-generating industries or we can continue to be led by the nose by politicians with no skin in the game and one day wake up and think “What happened?” without realizing we did it to ourselves.
Let's say he pays his cooks 30$ more. How long are they open, how many people work in the kitchen? Two people, 12 hours? So that would be 720$ more per day.
How much do they earn per meal? In my country in most restaurants charge around 10$ for a meal. Even assuming no costs for the food resources, that would mean 72 more meals to sell, per day.
To me that sounds like quite a challenge.
Honestly I feel like most people would pay it. It seems to me that everybody just accepts you pay like 10x the price of what you could make something yourself as reasonable. I don't get it and it irks me that we even need to participate in this facade that we're all some sort of royalty class that are entitled this.
Personal service might be more expensive overall, but I’m not ready to immediately declare that obvious just because the people behind it are visible to the buyer.
It's never a "just do this" answer. Never. You don't tell your friend with depression to plow through this down phase he's in. And the other friend with Crohn's disease and a colostomy bag doesn't benefit from someone suggesting she try a gluten-free diet.
It's the same in the food industry. The issues at hand are complex, the ripple effects of any change are significant and multifaceted, and the foremost issue today may be superseded tomorrow while nonetheless remaining an area for concern and attention.
The better move from the outside is to provide the support that's needed today by the business (or the friend) and within your means. Can't afford to go out for food regularly? I get it, just like your job may not allow you to be available as often as your friend with Crohn's disease needs a ride home from the hospital after some procedure.
At the very least, most of a restaurant's and a coffee shop's labor can be replaced with automated ordering, having the customer collect food themselves when it's ready, and using robots to prepare more of the food. they can do lattes with art all by themselves now.
A lot of these businesses just can't survive if they meet the wage demands of people who have benefitted from substantial stimulus over the last 2 years.
Automation would increase the quality of their service and reduce costs in the long run. I keep hearing about how much workers hate these jobs, so they should be happy to see them go away.
Edit: every example I gave above has been observed successfully in action. They just haven't been widely deployed enough to become a norm.
Other jobs that can be replaced:
- host -> seat yourself sign
- server -> pager, bus your table, ordering tablet (with just ordering, don't put ads and games like they did 5 years ago)
- barista -> robot/dispenser tech can manage several facilities simultaneously
- retail/grocery -> see what Amazon is doing
- cleaning/janitorial -> robots and more innovative cleaning apprpaches could save a lot more effort. Japan has self-cleaning public toilets.
Automation, automation, digital transformation, sure we can do it all. But in many cases it makes things suck a bit more, and life crappier overall.
If I go to a restaurant a real person taking the order is part of the ambiance and expected service. You pay for it (maybe not in USA though).
At the last place I visited some guy dropped a tablet on the table. It said 'Next-gen Restaurant Experience' at the back. We got to fiddle a long time to type our 6-person order in. Crappy. Last time I visit there.
> retail/grocery -> see what Amazon is doing
They facilitate rat-race shopping. No more small social chat at the PoS with employees that know you. Just in and out, and back to work.
We this kind of automation every time we lose small social interactions that are important in a healthy society, imho.
Sorry, end rant/
Would be completely happy with an automated process there, for my mind that means more of my tip might go to the cook who is actually preparing my food in the first place.
>At the last place I visited some guy dropped a tablet on the table. It said 'Next-gen Restaurant Experience' at the back. We got to fiddle a long time to type our 6-person order in. Crappy. Last time I visit there.
I'm definitely okay with fiddling with a tablet if it meant I didn't have to pay a 15% tip.
>They facilitate rat-race shopping. No more small social chat at the PoS with employees that know you. Just in and out, and back to work.
The amount of "small social chat at the PoS with employees that know you" I see happening (ie. when waiting in line) is approximately zero. In that case, the loss is zero.
If going to a coffee shop meant going to some sort of self service machine, pushing a few button and getting a machine made Nespresso pod coffee I'd just stay at home and save the money....
What's the end goal of all this ? Automate everything, skip all human interactions, destroy every small restaurants/coffee shops ?
This "automate everything" attitude is so weird, almost like some people want to dehumanise humanity. You know what would be the absolute automation, providing the best experience for everyone, for the least amount of energy spent ? Being in a coma in some form of pod, fed artificial thoughts and food/oxygen through tubes.
Automation only make sense if it delivers us from work, not if it pushes people into worse positions.
https://m.youtube.com/watch?v=G2iAGuRvN1w
As far as humanity is concerned, perhaps it is uniquely human to bitch about low paid service jobs (even when they aren't all that low pay) while also bitching about those jobs no longer being necessary. If the labor I interacted with regularly took their jobs seriously and had good customer service skills, I wouldn't be so quick to cut them out of the picture. Unfortunately my experience is that at least in the US, the culture of work varies wildly by region, and most of them aren't all that good for the consumer.
An exaggeration, but you see my point perhaps. Unless your service is really purely about bang for buck, trying to automate it in ways that are visible to the customer can have downsides. McDonald’s could probably go full robotic. Starbucks? Not sure, maybe. It would be a little offputting. Your local (good) pizza place? Not likely.
Ordering on my phone while I’m the way is easier than talking with a human. And easier to add stuff on.
I’ve never considered buying an espresso machine and bypassing my local coffee place.
Similarly, I wish all fast food went cashierless. The cashier is the slowest and most error prone part of the process.
> - server -> pager, bus your table, ordering tablet
> .... They just haven't been widely deployed enough to become a norm.
Attempts to revive the Automat (a century-old concept along those lines) haven't gone so well in the US. https://en.wikipedia.org/wiki/Automat
FEBO does this in the Netherland. https://en.wikipedia.org/wiki/FEBO , though also with in-person ordering.
> observed successfully in action
And failed in action.
Labour costs are, in many cases, really small; the capital and running costs of automation could well be comparable already.
Also those kind of seat yourself / serve yourself places exist, they're called fast food typically. Look at mcdonalds, chipotle or subway for example. That setup is actually very old, from the time before computers.
Places that serve alcohol like waiters although, because they are essentially alcohol salesmen that boost sales, and alcohol are big profit drivers for restaurants.
I recently went to a place that had no welcome/front end staff, just workers making a product (desserts) and a two kiosks at the front to take your order.
The kiosks interface was poorly made and confusing for a first time person. Worse, there was no sign telling me to step forward and order using the computer nor was there any sort of line to know who had already ordered and who were waiting to order. Over all it was a terrible experience and as such I don't plan on going back.
If restaurants do it poorly that is of course an issue, but it's not like rude servers and bad service don't exist.
Of course, Now that I think about it, I’ve never asked if I could just pay after ordering. The force of habit, huh!
The last place I went to like that, the owner was working probably due to lack of staff.
He was wearing a Rolex Explorer II.
Waited service is okay for special dates and business meals or something.
Which means "extracting free work from the customers", which is basically Marxism 101, "how to extract value from live work". My answer in such a place is to go straight out. I NEVER use the "automatic cashes", thank you very much.
> ... using robots to prepare more of the food. they can do lattes with art all by themselves now.
Robots are a sham, they're just a scarecrow to force workers into obedience. You'll replace more easily a lawyer with a robot than a toilet cleaner or a cook. Robots are fragile and horribly expensive. Good luck with that.
Just friggin' pay the people decent wages, for chrissake.
Free humans to do menial work. I think it’s pointless to try to improve wages for these low end jobs.
Similarly with fruit picking. It pays poorly and is hard and dangerous. The solution isn’t to improve wages, but to automate. Humans shouldn’t be forced to do meaningless jobs.
If the US can spend billions on fossil subsidies and trillions on military and foreign wars, it should be a no brainer to stimulate domestic the economy with universal healthcare.
The numbers you're looking at are too small. The war on terror cost $8 trillion in 20 years.[0] That's $500 billion a year. Divide this by US population (330M) and you get $1,515. How much healthcare could you buy for that per year?
And don't forget that even without the wars a lot of this money would've been spent on modernizing the military anyway.
[0] https://www.brown.edu/news/2021-09-01/costsofwar
We have plenty of resources but not the will to direct them.
https://posey.house.gov/wasteful-spending
The blue collar labor market is just a magnificent joke. I tried it for about 7 years of my life and they will literally only employ you if they somehow know you or you know someone else. If you're just a stranger, they won't even look at your resume. They don't even want to train on shit that in the 1960-1990's, they would take you if you weren't a total moron and could pass a drug test (if that even).
Modern HR has become a joke in this situation as well. Not only do they pretend like they add value to a company, but they filter out people who could easily be exploited for cheap simply because they don't have experience. Seriously, just hire a rando who seems vetted, make them do some bitch work and occasionally the main job duties. If they catch on, give them more, if not, get rid of them. It's like employers have become more risk averse than someone investing in CD's...
Bearing in mind it's only really the last generation or so in the UK who have gotten used to not expecting things like double pay for a night shift, workers expecting to be paid about £10p/h for a bar shift finishing at 4am still isn't a bad deal at all
My hypothesis is that a bunch of people in low-paid service jobs like this had their jobs cut under them by the pandemic and were forced to find alternative income streams. That was painful at the time, but now many of those people find themselves in a much stronger position to refuse the work.
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If your company has trouble hiring, it's a signal that something is wrong with the hiring process and the company needs to change it. Maybe stop leetcode nonsense, maybe offer more equity. Your managers should spend time to figure out the root cause and fix the problem. If your management cannot figure it out, fire them first.
If your company has trouble retaining engineers, it's a signal that something is wrong with the work environment. It could be pay. It could be lack of promotions. It could be a lack of recognition for the amount of work they are putting in. Once again, it is the management's job to figure out the root cause and fix it. If they can't, fire your management first. Hire/promote people who can do something different.
It is quite clear that in a hot economy, a lot of employers will need to reevaluate if they have the right decision makers in the first place.
This is also the reason why the best leverage for engineers is to switch regularly.
Why wait for the company to take action when management shows no interest or is not incentivized to promote their own team?
80%-90% employee turnover is built into the business model.
I think that unemployment benefits ends today. The eviction moratorium ends in Oct.
So we will see… if they still cannot hire they will try to increase wages + increase prices.