Is a flat pay rise the best approach to this problem? Rather than asking for fish, why not ask to be taught to fish? McDonald's donates several million dollars to charity and even has their own charity 'Ronald McDonald House', which does wonderful work. Why not direct some of that altruism to their own staff? Think of it as an investment in your own staff (where as a pay rise would be a cost, not an investment). Here are a couple of ideas:

Subsidized study - Offer employees the opportunity to upskill themselves through knowledge. Offer a range of courses which can help qualify the employees for higher paid roles. Hey you could even start the Ronald McDonald College for upskilling...

Create upskilling opportunities for internal promotion We are focusing on the staff who earn $10 an hour, but a fast food chain employs a huge array of people at pay levels which go all the way beyond 7 figures. Give the workers a chance to spend a day in accounting or logistics, they might learn something hey maybe you'll even discover they have aptitude to work in that department. Your future CEO might be offering someone fries at this very moment! Think it can't be done? Well then you haven't heard of David Murray, the bank teller who stayed with Commonwealth Bank and got promoted all the way up to become a successful CEO

Financial hardship is a common problem for fast food employees. A This strike is great way to bring attention to the issue (it's how we learned about the problem). If the workers are successful, they will see their average income jump from $10 to $15 per hour, that's a 50% jump in hourly earnings.

We'd all love a 50% pay rise, but would this be a solution and help bring these workers out of financial hardship? Here at the Finance Guy, we have some concerns. Here is a Streetonomic look at why an increase in pay may not be a lasting solution.

Profit maximization

We tend to say this a lot, but 'companies are in business to make money'. There are two key elements in turning a profit, maximize your revenue and minimize your costs. Wages represent the cost of labor, so naturally a pay increase to workers will see a matching profit decrease by the corporations.

Nobody would care if a fast food chain reports a few million dollars less profit for the year, right? Wrong! Unfortunately companies have people who benefit from their profits, known as stake holders. If you own shares in McDonald's, then you are a stakeholder in their profitability.

It would be wonderful if companies cared enough about their workers to ensure their quality of life. After all with out these workers, there is no fast food chain, looking after this essential part of the business should be important, but unfortunately it is not. If profits at McDonald's are down, we as share holders may lose a few dollars (if we sell), but the CEO and others in managerial roles, could lose their jobs.

If the strike is successful and the hourly wage increases to $15 per hour, the decision makers at all these fast food chains are going to face substantial challenges. How do they protect their profits if costs rise? More importantly how do they protect their high income jobs, they need to make payments on all those luxury cars and boats, specially so close to Christmas.

One way to maintain profit if wages go up, is increasing revenue, but that would be difficult. Fast Food companies are already blasting advertising at us from every imaginable source, and they couldn't make it any easier for us to find them and buy their food. They could rise prices, but that would be a slow and gradual process and would only work if they all did it. Imagine if every fast food chain except Arby's increased their prices by 20%, where would you go for lunch tomorrow?

An easier way to protect profits, is cost cutting, and the easiest cost to cut, is staff. Rising wages will see fast food chains take drastic measures to reduce their staff levels. Some staff will see reduced hours, while others will be laid off completely.