California Legislature Launches Investigation of Fast Food Industry Costs to Taxpayers

Sacramento, CA – Today a joint hearing of the Assembly and Senate Labor Committees began to examine the hefty public costs of low-wage fast food jobs. Featuring testimony from researchers, fast food workers, community healthcare organizations, and representatives from the fast food industry, legislators began to delve into the findings of a new University of California, Berkeley report, which showed that from 2007-2011, low-wage fast food jobs cost California taxpayers $717 million each year.

“Low-wage fast food jobs come at a high public cost,” said Ken Jacobs, Chair, U.C. Berkeley Center for Labor Research and Education, and one of the authors of the report. “The legislature is smart to investigate what California can do to lift up labor standards in the industry.”

At the hearing, legislators began investigating what the report referred to as “staggering” findings. The report found that fast food workers are more than twice as likely to be on public assistance then the overall workforce and that the families of more than half of the fast food workers employed 40 or more hours a week are enrolled in public assistance programs. As a whole, fast food jobs across the country cost American taxpayers nearly $7 billion each year.

“Fast food workers are taxpayers as well,” said Shonda Roberts, a KFC worker and mother of three. “I receive public assistance, not because I want to, but because my scheduled work hours are inconsistent and it’s tough to get by on such low wages.”

When it comes to the types of public assistance programs commonly used by fast food workers, the report found that fast food workers’ families depend on tax dollars for basic survival. More specifically, tax payers spend the following amounts on public assistance programs each year:

  • Medicaid and the Children’s Health Insurance Program, $3.98 billion;
  • The Supplemental Nutrition Assistance Program, or food stamps, $1.04 billion;
  • Temporary Assistance for Needy Families, $90 million.

“Policy makers need to understand the long-term consequences of low-wages and poverty on children. Children who grow up in poverty suffer a host of negative outcomes that society pays for well into adulthood,” said Mike Herald, a Legislative Advocate for the Western Center on Law and Poverty.

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