CEO: McDonald's would 'manage' minimum wage hike

McDonald’s Corp. for years has been in the cross hairs of a national campaign to raise the minimum wage, a movement that intensified last week as demonstrators marched on its Oak Brook headquarters.

The fast-food behemoth has rejected protesters’ call to more than double the national base pay from its current $7.25 an hour to $15 an hour as too high. It has said in a statement that it respects the right of employees to choose whether or not they want to unionize.

The official McDonald’s stance on the minimum wage calls it “an important discussion that needs to take into account the highly competitive nature of the industries that employ minimum wage workers, as well as consumers and the thousands of small businesses which own and operate the vast majority of McDonald’s restaurants.”

But earlier this month, in a less combative forum, McDonald’s Chief Executive Don Thompson told students at Northwestern University’s Kellogg School of Management that it could handle a theoretical bump in the minimum wage to, say, $10.10 an hour, the figure supported by President Barack Obama and others.

“McDonald’s will be fine,” Thompson said in the May 12 discussion. “We’ll manage through whatever the additional cost implications are.”

In this, one may assume, a minimum wage hike isn’t that different from escalating commodity prices, in which, whether the market is favorable or not, the chain can leverage its scale to negotiate the best possible deals.

Upping minimum pay nationally would be felt across not just the fast-food industry but the larger economy. Exploiting its size, McDonald’s should be able to offset increased costs through efficiencies its peers may not easily match.