New study from LA Economic Roundtable
Thousands of fast food workers in Los Angeles County are experiencing homelessness, according to a new economic study released this week.
Researchers with the Economic Roundtable, an L.A.-based nonprofit, estimate there are 3,595 unhoused fast food workers in L.A. County, and 10,120 across the state.
“We have people who are trying to support themselves through work and be able to pay rent, and they work in a very profitable industry,” said Economic Roundtable president and study co-author Daniel Flaming. “But their job does not enable them to remain housed.”
Flaming said the study’s data analysis, which he believes provides a conservative estimate, results in figures estimating that the fast food industry employs 11% of unhoused workers across California and 9% of unhoused workers in L.A. County.
The study is based on data from the U.S. Census Bureau, which does not directly report information about unhoused workers in the fast food industry. Instead, the authors applied a series of filters to Census data about restaurant workers who are not living in standard housing.
Despite negative stereotypes about unhoused people being unable to hold down a job, significant numbers of unhoused Angelenos are working.
In a 2020 study, UCLA researchers found that 18% of people showing up in L.A.’s homeless services system earned income in the same quarter they fell into homelessness. About 10% of unhoused L.A. residents surveyed in recent years said they were currently employed.
Fast food wages have been steadily rising in recent years. The hourly minimum wage is now $15.50 across California for all workers. It’s even higher in some parts of the state. Workers employed within the city of L.A. must receive at least $16.04 per hour.
But minimum wage hikes haven’t led to stable housing for many low-wage workers in California, a state suffering from a severe shortage of affordable housing.
The Economic Roundtable study found that California’s frontline fast food workers (which includes roles such as cook and cashier), earned a median income of $14,949 in 2020. Most are not working full time, receiving 26 hours per week on average.
In order to afford housing, 24% of frontline fast food workers in the city of L.A. are spending more than half their income on rent. And 43% are living in overcrowded housing, defined as households with more than one person per room. Public health experts say L.A.’s high rates of overcrowded housing likely worsened the spread of COVID-19.
Flaming said these precarious housing conditions can make entire households vulnerable to eviction and potential homelessness due to small fluctuations in income or expenses.
“Emergencies come up. You have to fix the car that you drive to work to get your income. And that costs you a bunch of money,” he said. “These are very fragile solutions and they break down easily.”
Some fast food industry representatives took issue with the methodology of the study, which was commissioned and funded by the Service Employees International Union (SEIU).
“This report is not a scientific study, but an advocacy piece,” said Jeff Hanscom, spokesperson for the International Franchise Association, in an emailed statement. “It’s shameful that SEIU would try to exploit the very serious issue of homelessness to pump out a bogus report to advocate for its union growth agenda.”
Fast food industry representatives said the study exaggerates workers’ housing troubles and likely inflates the number of unhoused fast food workers in California by including data on workers who may be employed in full-service restaurants, who may have only worked brief stints in fast food before becoming homeless, or who in some cases may be living in student housing, such as fraternities or dorms.
Flaming said he and his co-author spelled out their methodology in detail in the study’s footnotes, and they invited other experts to replicate and critique their findings.
"I would welcome an opportunity to review comparable data from the fast food industry,” Flaming said in an emailed response. “Our findings may be embarrassing for them, but I don't think they have standing to dismiss our transparent and fully-documented research."
Many fast food innovations, and some of today’s largest chains, come from the L.A. area. In-N-Out pioneered the drive-thru in Baldwin Park. Taco Bell began in Downey. The Glendale Galleria was home to the first Panda Express. McDonald’s started in San Bernardino in 1940.
But today, fast food critics say the industry traps hundreds of thousands of Californians in poverty-wage jobs, all while corporate executives and shareholders rake in massive profits. According to the report, McDonald’s CEO Christopher Kempczinski earns $1,224 for every $1 earned by a typical employee. McDonald’s representatives did not respond to our emails seeking comment.
California lawmakers have attempted to give fast food workers more bargaining power through bills such as AB 257, signed into law by Gov. Gavin Newsom last year. But that law is now on hold due to a fast food industry initiative headed for the November 2024 ballot that gives voters the option to block it.