Developments in the kitchen need to keep up with the technology put in the hands of consumers.
— Jason Clampet
For Dudley Dickerson, the mobile-app orders were the last straw.
McDonald’s Corp. has been updating with new technology, delivery, a revamped menu and curbside pickup. But the chain’s “Experience of the Future” effort could backfire. Employees are handling more tasks, in many cases, they say, without pay raises or adequate staffing. So Dickerson, 23, handed over his spatula for the last time.
“They added a lot of complicated things,” Dickerson said in an interview. “It makes it harder for the workers.”
Sure, lots of fast-food employees hop from job to job. But with unemployment so low, turnover is becoming a problem. Workers are walking rather than dealing with new technologies and menu options. The result: customers will wait longer. Already, drive-through times at McDonald’s slowed to 239 seconds last year — more than 30 seconds slower than in 2016, according to QSR magazine. It’s also pokier than Burger King, Wendy’s and Taco Bell.
150 Percent Turnover
Turnover at U.S. fast-food restaurants jumped to 150 percent — meaning a store employing 20 workers would go through 30 in one year. That figure is the highest since industry tracker People Report began collecting data in 1995.
“Quick-service restaurants are having a little more trouble with job openings and finding workers,” said Michael Harms, executive director of operations at People Report. “It’s the pace of work, the pace of technology and the lower wage rate.”
McDonald’s and its franchisees haven’t seen an increase in crew turnover over the last year, nor is there a correlation between the new initiatives and turnover, spokeswoman Terri Hickey said in an emailed statement. “Together with our owner-operators, we are investing in all necessary training to ensure successful implementation of any changes in our restaurants,” she wrote. “Just as Experience of the Future modernizes the restaurant experience for our customers, there is also a focus on improving the work experience for restaurant employees.”
McDonald’s Chief Executive Officer Steve Easterbrook has been pushing initiatives that have helped turn around comparable sales, which rose 3.6 percent last year in the U.S. But they’ve also made it tougher to retain restaurant employees in an already tight labor market.
“The ball is really in the court of the workers,” Harms said. “Not the employers.”
Last year, McDonald’s said it employed 235,000 people, including corporate and restaurant workers. Each of those people generated $97,000 in revenue, compared to about $65,000 the year before. While this could be a sign of increased efficiency, it can just as well be seen as stretching thin an inadequate number of employees.
In Broward County, Florida, Westley Williams said he’s switching to a job at burger joint Checkers after being stretched too thin at McDonald’s. Williams, 42, says he’s quitting because of the chaos caused by mobile-app orders, new items and six recently added self-order kiosks.
“It’s more stressful now,” said Williams, who added that he didn’t get a raise for doing more work. “When we mess up a little bit because we’re getting used to something new, we get yelled at.”
On a recent Wednesday afternoon, about 10 McDonald’s workers hustled behind the counter of a store in Chicago’s Loop. They called out order numbers for those waiting for lunch — some had ordered via an in-store kiosk, some from the mobile app and some the old-fashioned way, at the register.
An order of a Bacon McDouble, small fries and an apple juice took about two-and-a-half minutes, faster than the average drive-through time, but the drink was missing and the employee seemed confused when asked for it.
“The biggest risk when you have a lot of employee turnover is the customer experience,” said Brian Yarbrough, an analyst for Edward Jones. “If that starts to wane, then this turns into a bigger problem.”
At another restaurant in Chicago the same day, McDonald’s staff rushed to keep up with the dinner crowd. Cars lined up at the drive-through and curbside pickup spots were full. A mobile-app order for fries, an Egg McMuffin and McFlurry for curbside pickup took just over five minutes.
Missing from the bag: ketchup for the fries.
©2018 Bloomberg L.P.