Chasing Starbucks: Why McDonald's 50,000-Employee Hiring Spree Is a Sham
McDonald's (MCD) announcement that it plans to go on a massive one-day hiring spree -- rounding up 50,000 new fry dunkers, burger cookers and latte makers -- is further evidence the fast food giant is trying really hard to be more like Starbucks (SBUX), which has become the most desirable place to get a part-time, temporary or otherwise dead end job.
First, there were the coffee wars, started when McDonald's switched to better quality brew and added frou frou lattes. Then, after Starbucks saw big success selling oatmeal, McDonald's adopted this healthy item for its menu.
Now it's about jobs. The fact that McDonald's is holding a giant job-athon (on April 19th) in the midst of high unemployment tells you that it's more of an image-boosting PR stunt than some urgent HR need.
Get yer McJob here
"A McJob is one with career growth and endless possibilities," the company said in its statement. Jan Fields, president of McDonald's U.S. operations, told the Chicago Tribune that she started her career behind the counter in 1977 as a young mother working her way through school. "I have a McJob. And I'm darned proud of it," she said.
While adding 50,000 new employees all at once may seem like a big deal, for a company like McDonald's it's really not. With 14,000 U.S. restaurants, this amounts to 3 or 4 new people per store -- not a lot when you consider that the average McDonald's employs 40 to 60 people, according to Richard Adams of Franchise Equity Group.
And hand it back in here
Another dirty secret: Most of those 50,000 new workers will be gone by this time next year. McDonald's employee turnover, like that at most fast food restaurants, is often over 100%. McDonald's is in a perpetual state of frenzied hiring. Last year, the company went on a 13,000 employee blitz.
Ultimately, McDonald's biggest challenge in trying to elevate the McJob towards the realm of a Starbucks barista will be the fact that its benefits aren't nearly as attractive. While the starting hourly pay is similar -- between $8 and $9 an hour -- Starbucks offers a fairly comprehensive health plan, while McDonald's gives its hourly employees so-called mini-med plans, an approach so inadequate that the new healthcare law seeks to phase them out. McDonald's most popular health insurance plan caps benefits at just $2,000 a year, which if you've seen a medical bill lately, is about enough for a single X-ray.
Starbucks also offers all its store employees other benefits, like 401(k) matching. Plus, they feature the smell of fresh-brewed coffee and espresso versus the rancid aroma of frying oil. In a crummy job market, McDonald's should be able to hire 50,000 people without much effort. But not if Starbucks were to also offer them all jobs.
Image by Flickr user superterrific
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