Sacramento Chick-fil-A Ups Minimum Wage

The owner of a Chick-fil-A restaurant in Sacramento, Calif., plans to raise the wages of his employees, according to a report in The Washington Post.

The sizable raise represents a possible new high-water mark for fast-food workers, which, according to some restaurant industry analysts, comes at a time when competition for unskilled labor is rising amid low unemployment, greater immigration scrutiny and fewer teenagers seeking to work in fast-food jobs.  

Eric Mason, owner of the Chick-fil-A location in Sacramento, told a reporter for the local ABC news affiliate KXTV that he raised his workers' pay from $12 to $13 an hour to $17 to $18 an hour starting June 4, referring to the increase as a "living wage." In California, the minimum wage is $11 for employers with 26 or more workers and will go up $1 a year until 2022.

Mason is investing in a long-term approach. He told the reporter, "What that does for the business is provide consistency, someone that has relationships with our guests, and is going to [build] a long-term culture."

His approach could be a win. With the high cost of turnover in the restaurant business (the turnover rate in the restaurants and accommodations sector was 73% in 2016, according to Bureau of Labor Statistics data), it could be a great investment to avoid the cost of retraining and building a more solid workforce in an era when there are less qualified candidates for these minimum wage jobs.

That's particularly so for a chain like Chick-fil-A, which has a reputation for its customer service and prides itself on friendly employees. As the Post writes: "You can't have that high level of service when you continually hire people and have to train people. You need people who’ve been in their job for a while. That’s Chick-fil-A's reputation, and that’s very true across the country." 

It's both smart and good business.