Now watch teen unemployment jump, and prepare for a future generation of people who couldn't get early work experience, and so become less employable in the long-run.
Because that's not how it happens at all. Companies don't hire more staff than they require. If McDonalds needs 10 employees per shift to operate, they're going to hire 10 per shift no matter if they cost $8/hr or $16/hr.
The amount of work determines the number of employees, not the other way around.
To properly phrase your example, yes it is depend on "work", but work is dependent on revenue. If McDs needs 10 employees per shift where they generate $800, each employees total cost per shift cannot be more than $80, which works out to about $10 CTC (cost-to-company) per hour in an 8-hour shift.
If you now mandate that the worker salary MUST be $12 or higher than $12, McDs is losing money. So you either pray for an increase in business (sales), or cut costs (ie, fire people) and automate.
And lower-skilled jobs are easier to automate. It's easier to automate fast-food checkout by having (for example) iPads for people to place their orders, so your human workforce can just be the cooks at the back and the janitorial staff.
Or you increase prices. Or a combination of the three.
I'm not aware of all the complex reason for why the following is the case, but my brother's mom (I know how odd that may sound) was able to rent an apartment when she was 18 working in fast food without tips. There is _no way in h-e-double-hockey-sticks_ that that could happen anywhere in America today. I'm not convinced that raising minimum wage is the solution -- it could be part of the problem. Models of human behavior and economics can get tricky and counter-intuitive. It is a hard nut to crack; I'll just stick to writing software. Now, if someone wants to pay me to make and become familiar with those models....
That's not strictly true. If you have two programmers, one produces $80 in value per hour and the other only $40 in value per hour you can still afford to pay both $60/hr each. This happens all the time because worker productivity is uneven and some jobs are more important/impactful than others. The requirement that revenue exceed costs is only true in aggregate, so the effect of increasing low-wage employee cost is to reduce profits.
This is a simplistic example and assumes unlimited supply of labor, but it illustrates the point.
The result is that the unskilled end of the spectrum are too expensive in relation to their productivity. These are the ones who end up unemployed.
I am not an economist, but that is how I understand it.
If you want an intelligent, fair-minded, and properly-researched account of economics at McDonald's see here:
http://www.bloomberg.com/news/2012-12-12/mcdonald-s-8-25-man...
The consensus is less conclusive on specific effects on minority groups. I've seen at least one paper showing short-term unemployment increase in minority groups. I've also seen at least one paper showing increased employment/earnings in younger, more affluent teens.
Some of the recent well-cited studies:
http://www.irle.berkeley.edu/workingpapers/166-08.pdf (2011) Looking at 1990-2009 CPS data: "Including controls for long-term growth differences among states and for heterogeneous economic shocks renders the employment and hours elasticities indistinguishable from zero and rules out any but very small disemployment effects. Dynamic evidence further shows the nature of bias in traditional estimates, and it also rules out all but very small negative long-run effects."
http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8543.2009.... (2009) "A 10 per cent increase in the minimum wage reduces employment by about 0.10 per cent (see column 4 of Table 3). But even if this adverse employment effect were true, it would be of no practical relevance. An elasticity of −0.01 has no meaningful policy implications. If correct, the minimum wage could be doubled and cause only a 1 per cent decrease in teenage employment."
Not even an iota.
Businesses need those employees anyway. And the impact of an increased minimum wages is minimal. They pay them less not because paying them more would drive them out of business or really eat into their margins, but just because they can.
And it's not just teens. TONS of people work on minimum wage jobs that are older, including over fifty.
People who don't have those skills and experience (e.g. teenagers) will find it harder to justify their value to job creators, creating a vicious circle as they can't get experience without employment. If I have to pay $10, I'll seek to employ people who are worth $10+.
Youth unemployment is 34.6% in California[0] - the next generation of workers can't afford this.
[0]http://www.governing.com/gov-data/economy-finance/youth-empl...
It's not like you need "skills" and "experience" for most minimum wage jobs. You just need to be able to take hard work, crazy hours, and living on near (or below) substinence levels. The churn rate is quite high anyway, for experience to matter one iota.
>creating a vicious circle as they can't get experience without employment. If I have to pay $10, I'll seek to employ people who are worth $10+.
Most people that make minimum wage work their asses off. That's with regard to work amount. As for their benefit to the company, that's more than their salaries anyway.
A lower minimum wage will not stop unemployment (whose reasons are completely different than wage demands). It's not like the pressure on companies is wage costs, and since minimum wage is the same in an area, there's no competition to businesses (e.g burger flipping, gas stations, cleaning, etc) from other companies as they all have to pay the same minimum wage.
>Youth unemployment is 34.6% in California[0] - the next generation of workers can't afford this.
That's because of lost business/industry/etc jobs, and not because businesses couldn't afford the tiny minimum wage that was already there. So the increase wont change anything.
Not to mention: economies can also die because greedy owners pay their employees less. That saves some money short-term creates a death spiral of diminishing incomes and less spending all around.
There's a reason Henry Ford wanted his pay his employees so that can "afford his cars".
http://www.bls.gov/web/empsit/cpseea10.htm
The question is, how many people are working minimum wage jobs who aren't teenagers.