www.baltimoresun.com/news/opinion/readersrespond/bs-ed-jobs-letter-20130829,0,6093849.story

baltimoresun.com

Cutting CEO pay won't raise worker wages

4:00 PM EDT, August 30, 2013

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Robert Reich misleads readers by contrasting the pay of McDonald's and Yum Brands hourly employees with their respective CEOs in his recent commentary ("Jobs are coming back, but they don't pay enough," Aug. 28).

Neither corporation is primarily in the restaurant management business. Rather, over 80 percent of both Yum and McDonald's locations are owned by franchisees. The economics they face are sharply different than the editorial suggests. For instance, a $15 wage mandate would wipe out more than three-quarters of the already-small profit earned by a typical McDonald's franchisee.

Even at restaurants that aren't franchised, targeting executive pay makes little sense: Even redistributing 100 percent of the pay of the CEOs of the country's largest restaurants would give employees a raise of less than one cent per hour.

Michael Saltsman, Washington, D.C.

The writer is research director of the Employment Policies Institute.