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After Automating Order-Taking, Fast Food Chains Had to Hire More Workers (theatlantic.com) 234

An anonymous reader quotes the Atlantic: Blaine Hurst, the CEO and president of Panera, told me that because of its new [self-service] kiosks, and an app that allows online ordering, the chain is now processing more orders overall, which means it needs more total workers to fulfill customer demand. Starbucks patrons who use the chain's app return more frequently than those who don't, the company has said, and the greater efficiency that online ordering allows has boosted sales at busy stores during peak hours. Starbucks employed 8 percent more people in the U.S. in 2016 than it did in 2015, the year it launched the app...

James Bessen, an economist at Boston University School of Law, found that as the number of ATMs in America increased fivefold from 1990 to 2010, the number of bank tellers also grew. Bessen believes that ATMs drove demand for consumer banking: No longer constrained by a branch's limited hours, consumers used banking services more frequently, and people who were unbanked opened accounts to take advantage of the new technology. Although each branch employed fewer tellers, banks added more branches, so the number of tellers grew overall. And as machines took over many basic cash-handling tasks, the nature of the tellers' job changed. They were now tasked with talking to customers about products -- a certificate of deposit, an auto loan -- which in turn made them more valuable to their employers. "It's not clear that automation in the restaurant industry will lead to job losses," Bessen told me.

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After Automating Order-Taking, Fast Food Chains Had to Hire More Workers

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  • They keep running out of "workers" [akamaihd.net].

  • by Rick Zeman ( 15628 ) on Sunday December 10, 2017 @10:37PM (#55713425)

    "Starbucks employed 8 percent more people in the U.S. in 2016 than it did in 2015, the year it launched the app..."

    Employees per store is the only valid statistic to support their contention. Otherwise, it's factoring in new employees in new stores.

    • by mark-t ( 151149 )
      Actually, the number of stores also increased that year by about the same percentage, indicating that automation did not reduce their rate of hiring, as might have otherwise been predicted.
      • Re: (Score:2, Flamebait)

        by Ol Olsoc ( 1175323 )

        Actually, the number of stores also increased that year by about the same percentage, indicating that automation did not reduce their rate of hiring, as might have otherwise been predicted.

        It's a completely bogus statistic, and means nothing, because if true, everyone who replaces employees with automation will have to hire more people. That isn't possible.

        Somehow in there, if we automate everything and have zero employees, we'll also have full employment with more employees needed in the world. I guess itdepends on how you look at it. Sounds like Schrödinger's Restaurant.

        • by mark-t ( 151149 )

          It may have escaped your attention that you saying that something "isn't possible" has no bearing on whether or not it actually happens.

          Which is kind of funny, because it does.

        • if true, everyone who replaces employees with automation will have to hire more people. That isn't possible.

          Look, nobody is claiming that ALL automation increases employment, because that is clearly false. For instance, automation of agriculture drastically reduced agricultural employment.

          Nobody is even claiming that ALL restaurant automation increases employment. For instance, there is no evidence that automatic french fryers increase employment. Why would they?

          They are only claiming that automation of order-taking (using kiosks, apps, or webpages) creates more jobs than it eliminates. Although that claim ma

          • For instance, automation of agriculture drastically reduced agricultural employment.

            Not quite as simple as that actually. Total employment in agriculture in the US increased dramatically [ourworldindata.org] from 1850 to 1900. It has fallen since then but the total number of people employed in agriculture has only in the last 20 years or so fallen below the number employed in 1850. In 1850 about 3.5 million people in the US worked in agriculture. It wasn't until about 1970 that the number fell below 3.5 million again. In 2000 the number was around 3.1 million. Per captia numbers in agriculture have been

        • Actually, the number of stores also increased that year by about the same percentage, indicating that automation did not reduce their rate of hiring, as might have otherwise been predicted.

          It's a completely bogus statistic, and means nothing, because if true, everyone who replaces employees with automation will have to hire more people. That isn't possible.

          Somehow in there, if we automate everything and have zero employees, we'll also have full employment with more employees needed in the world. I guess itdepends on how you look at it. Sounds like Schrödinger's Restaurant.

          Err, not everyone that automates hires more people (see coal for instance.) And not everyone that implements automation hires more people linearly to the costs of automation (see those industries that increase traffic by adding kiosks and automated cash registers.)

          When companies increase traffic and find they need to improve customer quality, they do need to hire more people (or retrain their existing ones to be more customer-oriented.)

          Shit ain't a zero-sum game ya know?

    • by Baron_Yam ( 643147 ) on Sunday December 10, 2017 @10:51PM (#55713471)

      In terms of employed humans, you also have to include statistics for coffee shops that shut down when a Starbucks popped up.

      Just because Starbucks is employing more people doesn't mean the industry as a whole is doing so.

    • by BlueStrat ( 756137 ) on Sunday December 10, 2017 @11:08PM (#55713533)

      "Starbucks employed 8 percent more people in the U.S. in 2016 than it did in 2015, the year it launched the app..."

      Employees per store is the only valid statistic to support their contention. Otherwise, it's factoring in new employees in new stores.

      You are correct once market saturation us achieved, as there can only be so many stores per a given area. After that market saturation point is passed, further automation will result in fewer employees when the area in question has enough stores to serve the available market.

      As long as more stores are being added within an area/market, the store chain *as a whole* is employing more total workers within that area/market.

      Strat

    • FFS, what happened to critical thinking?

      Step 1 is to get everyone used to ordering and paying automatically.
      Step 2 is to produce and deliver the goods automatically.
      At Step 2 is when all the jobs go!

      Its just the same plan Uber is playing - why do you think they are happy to run at a loss now? They are just planning to be the standard when self-drive cars reduce the other half of the operation to close to zero cost.

      Come on people, this is pretty obvious.

    • by sound+vision ( 884283 ) on Sunday December 10, 2017 @11:47PM (#55713637) Journal
      I can also tell you that they cut those employee's hours by way more than 8%... company-wide... at around the same time. I know someone who manages several stores for Starbucks, but I also read about it on Google News. Hours were cut by about a third IIRC. The company was trying to keep everyone below the top levels in the dark about it, of course.
      • by guruevi ( 827432 ) <`moc.stiucricve' `ta' `ive'> on Monday December 11, 2017 @12:58AM (#55713873) Homepage

        You can thank ObamaCare for that, people that donâ(TM)t work full time donâ(TM)t need their employer to pay (as much) for health insurance. Many companies have dropped hours to avoid insurance costs. At least we now have higher taxes, a state sponsored healthcare system, more people are employed and we now get the 30 hour work week, just like Europe.

        • You forgot to finish your thought:

          And instead of accepting that automation is the future and working on a potential solution for the inevitable problem, republicans choose to blame anyone but themselves, while trying to pass a tax bill that lets the ultra rich take one last pass at scraping every cent they can from the poor before they die and let their children deal with the ultimate collapse.

          Who cares about saving the planet when I'll be dead before destroying it in the name of profits actually causes me
    • "Starbucks employed 8 percent more people in the U.S. in 2016 than it did in 2015, the year it launched the app..."

      Employees per store is the only valid statistic to support their contention. Otherwise, it's factoring in new employees in new stores.

      Unless the app made Starbucks more profitable and led to more stores being opened.

      Of course you'd need to compensate for job losses from competing stores.

      But at the same time you might try to capture secondary benefits from the whole coffee-ordering transaction being made more efficient.

      Things get complicated quickly.

      • by mark-t ( 151149 )
        Actually, the total number of stores also increased by about 8% in 2016 compared to 2015, which suggests that their rate of hiring did not diminish despite increases in automation.
    • Incorrect. You are ignoring two factors mentioned in the SUMMARY, let alone the article.

      Lowered costs and higher demand are both key factors that business people take into account when they decide whether or not to open a store.

      I won't open a store at the corner of Busy St and Office Avenue unless costs are less than the estimated profits. If automation allows me to hire fewer people in that particular store, and also allows me to offer people coffee on the way to work WITHOUT a 10 minute wait, then I wi

    • by kenh ( 9056 )

      "Starbucks employed 8 percent more people in the U.S. in 2016 than it did in 2015, the year it launched the app..."

      Good thing Starbucks stopped building new store fronts since 2014, so we have no other possible reason for the increase in their workforce...

    • Even that's not valid. Projected employees per store is the only valid metric. And if you really want to see whether more jobs were created, compare that with employees in the same markets for non-Starbucks coffee.

  • by TheNarrator ( 200498 ) on Sunday December 10, 2017 @10:44PM (#55713447)

    Jevons Paradox, which has been around since the 1800s, says that the more efficiently a resource is used, the more demand there will be for it. Thus, the more efficiently human labor is used, the more demand there will be for it.

    https://en.wikipedia.org/wiki/... [wikipedia.org]

    • by interkin3tic ( 1469267 ) on Sunday December 10, 2017 @11:53PM (#55713659)
      Which explains why in Japan, there have been automated coffee shops on most street corners for decades.

      They're called "vending machines."

      The coffee in a can is equivalent to starbucks, except cheaper and in a lot more locations.

      Why the fuck don't we have that here already?
      • In Taiwan during the cold (for them) winters I would often go to the 7-11 and purchase a can of coffee or ovaltine which was kept in a heated box. Just crack it open and you have a hot beverage.

      • by JanneM ( 7445 ) on Monday December 11, 2017 @12:35AM (#55713791) Homepage

        I agree about the coffee quality. However, Starbucks isn't really in the business of selling coffee. They sell space. You really buy a break in a pretty comfortable, relaxed environment; a living room for rent. The overextracted cardboard mug of coffee is just a bonus.

        • Also seems the females like the crowd part; and where they go the other half goes as well. Yeah it's not about the drink -- it could even be a glass of "vitamin" water. The crowd will be there. A place to socialize and find "friends"?
      • The coffee in a can is equivalent to starbucks, except cheaper and in a lot more locations.

        I won't pretend Starbucks coffee is amazing but to claim that coffee in a can is equivalent is only valid in the sense they are both coffee. Pretty much nothing else about them is equivalent. Both are fine but they are vastly different in too many ways to bother enumerating here.

  • by gweihir ( 88907 ) on Sunday December 10, 2017 @10:50PM (#55713469)

    If this is meant to say that "automation creates jobs", it is an utter fail. What happens instead is that those that automate get more business, a) showing that automation works and b) accelerating automation and c) job-loss in late-comers to automation will be even larger.

    Are people really too stupid to see this? Because it is blatantly obvious.

    • The rise in orders is probably just a spike from those techheads that refuse to buy anything unless there's an app for it. Once others have apps, or they go out of fashion, the demand will drop off.

      • by gweihir ( 88907 )

        And that is also a very real possibility. So longer-term, there may not even be more jobs at this company.

    • by interkin3tic ( 1469267 ) on Sunday December 10, 2017 @11:50PM (#55713645)
      The summary to me read "Increases demand, increases demand, increases demand" and ended with either a stupid joke or disingenuous propaganda

      I doubt many people take away that the important bit here is there will maybe somehow be more need for coffee artists. The interesting part is that demand goes up from robots.

      A more interesting, accurate conclusion would be "Evidently, people DON'T get coffee at Starbucks or food at McDonald's to talk to employees! WE ACTUALLY ALL HATE INTERACTING WITH PEOPLE IN THAT CONTEXT! WHO KNEW BESIDES EVERY SANE HUMAN BEING!?!"
    • If this is meant to say that "automation creates jobs", it is an utter fail. What happens instead is that those that automate get more business, a) showing that automation works and b) accelerating automation and c) job-loss in late-comers to automation will be even larger.

      Are people really too stupid to see this? Because it is blatantly obvious.

      Yes, people are that stupid. If a store has to hire more employees bacause of an uptick in business, it does not follow that every store that automates will have the same uptick in business. Hard to imagine anyone would think so, but here we are with the same sort of logic that created the housing bubble.

      • by gweihir ( 88907 )

        Indeed.

      • Yes, people are that stupid. If a store has to hire more employees bacause of an uptick in business, it does not follow that every store that automates will have the same uptick in business.

        Of course not. But automation demonstrably can and does make industries grow faster overall. There will be winners and losers but the size of the overall economic pie can be grown larger through automation and that often means more jobs overall - albeit doing different things.

        Hard to imagine anyone would think so, but here we are with the same sort of logic that created the housing bubble.

        That was a different phenomena and isn't really a great analogy. First there is no evidence of a bubble but if you are going to compare with one a better analogy might be the dotcom bubble. New automation technology created a bubbl

    • It seems to be alive and well in my local Post Office. They've got two automated machines where you can supposedly do all the necessaries to get your parcel or letter sent however you'd like it to be handled. Then they've got the traditional queue-up system with a handful of windows and a "please go to window 2" machine.

      I took a look at the machines, and bearing in mind I'm a sysadmin, thought "how hard can it be?" (pff! most of the people in the line are pretty old, maybe it's too complicated for them!). T

  • by BronsCon ( 927697 ) <social@bronstrup.com> on Sunday December 10, 2017 @10:53PM (#55713479) Journal
    ...more valuable to their employers... who, of course, pay them a higher wage commensurate with that increased value. Right?
    • Nah, they just get immigrants to do it. The days of wages rising for low skill/no skill work are over. There will always be a flood of new people willing to work in terrible conditions for low wages, because it's much better than wherever they came from. Why do you think our billionaires are so in favor of it?
      • That's a fools game, though, and will ultimately bite those billionaires in their collective asses. Immigrants (specifically illegals) tend to send their earnings back home, so the money paid to them never makes it back into the pockets of the people writing the checks. When you pay a red blooded American (or a legal immigrant -- after all, that's what we all are, anyway) to do the job, they spend it here and it comes back to you at least in part.

        Ford didn't ensure that his employees could afford his prod
  • What is it with people these days and their lack of logic sense and understanding what they are talking about. Can't this guy see that he's proving exactly the opposite with his comment?
    "It's not clear that automation in the restaurant industry will lead to job losses"

    You make a service more convenient with automation, which attracts more costumers and whatnot. Sure. But how can you reach the conclusion that it won't lead to job losses stopping there? Are you some sort of idiot?

    Here, let me complete to you.

    • Here, let me complete to you. Those costumers are often choosing your restaurant over others because of convenience. As they are going there because they don't want to interact with regular human employees, this means they are choosing automated services, which might hire more people for overhead in your business, but it'll also be killing other businesses that don't have automated services.

      What's more, they only need more humans in their store to make bread and hand it to customers right now. Those jobs are going to be automated away eventually as well, and the funding that will make it happen is being generated right now... it's enabled by the combination of their kiosk and internet sales, and the additional human workers they've hired on right now. This is like cheering for the trucking jobs created by companies working on automating truckers out of existence. I'm all for cheering for the a

  • So to balance the equation two things may happen:

    1. People eat out more because perhaps it will get cheaper to eat out since labor is the largest cost in the restaurant business; or

    2. Competition will drive out of business the (usually smaller) less competitive restaurants resulting in job losses as competition increases for the static level of consumers.

    Both of these could happen together or to varying degrees.

    • So to balance the equation two things may happen:

      1. People eat out more because perhaps it will get cheaper to eat out since labor is the largest cost in the restaurant business; or

      2. Competition will drive out of business the (usually smaller) less competitive restaurants resulting in job losses as competition increases for the static level of consumers.

      Both of these could happen together or to varying degrees.

      The people who lose theior jobs will eat out every night of the week because they'll have more time on their hands to spend their money.....

  • Innovation (Score:5, Informative)

    by schematix ( 533634 ) on Sunday December 10, 2017 @11:36PM (#55713617) Homepage
    I used to hate going to starbucks because it took 5-10 minutes of waiting in line just to order a cup of drip coffee. My time is too valuable to piss it away doing something like standing around. Now i place my order from my phone as i am rolling out of the drive way in the morning. 7-9 minutes later when i get there it's on the counter with my name on it. They didn't need a person to take my order and no one had to wait. This is the what innovation is all about folks. On a side note, when i go into starbucks to get my drink now, there normally isn't even a person working the register. Everyone is making drinks for mobile orders and the drive thru. Much more value added use of resources.
    • I used to hate going to starbucks because it took 5-10 minutes of waiting in line just to order a cup of drip coffee. My time is too valuable to piss it away doing something like standing around. Now i place my order from my phone as i am rolling out of the drive way in the morning. 7-9 minutes later when i get there it's on the counter with my name on it. They didn't need a person to take my order and no one had to wait. This is the what innovation is all about folks. On a side note, when i go into starbucks to get my drink now, there normally isn't even a person working the register. Everyone is making drinks for mobile orders and the drive thru. Much more value added use of resources.

      Doesn't make up for the fact that StarBuck's coffee tastes moldy and muddy. But hey, some folks like it that way.

      • Count me as one of the few people who actually think they have the best drip coffee out there. The rest of the sugar laden crap they serve to their excessive posterior possessing customers though, blech.
    • They didn't need a person to take my order and no one had to wait.

      I'm guessing when you say "no one had to wait" you actually mean "I didn't have to wait". From what I've seen, Starbucks prioritizes mobile orders. My personal experience has been that walk-ins now wait longer because the service personnel keep getting interrupted by new mobile orders.

      But, in any case, I don't go to Starbucks as much as I used to. There's this other place - Specialty's Cafe and Bakery [specialtys.com] - that's right next to the Starbucks at Seattle's International District station. The coffee is better, the

      • I also observed in the days before the mobile app as a walk-in customer they prioritized drive thru customers (still true to this day they prioritize drive thru over everything). There's always a way to prioritize the queue, but if i can get myself in there in a more convenient spot, that's what myself and so many others are looking for. If someone else won't play the game by the rules, their loss. Their baked goods suck anyways. Their drip coffee is great though. Dark, roasty and packed with caffeine. Als
      • They didn't need a person to take my order and no one had to wait.

        I'm guessing when you say "no one had to wait" you actually mean "I didn't have to wait". From what I've seen, Starbucks prioritizes mobile orders. My personal experience has been that walk-ins now wait longer because the service personnel keep getting interrupted by new mobile orders.

        But, in any case, I don't go to Starbucks as much as I used to. There's this other place - Specialty's Cafe and Bakery [specialtys.com] - that's right next to the Starbucks at Seattle's International District station. The coffee is better, the baked goods are amazing (and mostly made on premises!), and walk-in service is incredibly fast. Hmm, maybe I shouldn't be encouraging more customers...

        Ah, yes, Specialty's. They've been doing automated ordering for several years now. And it's awful. Maybe not for the restaurant but placing an order on their Ipad's is painfully awkward and slow. It is a much worse experience than waiting to give an order to a human. Placing the order online from a real computer with login already setup is not as bad and any extra time is offset by overlapping travel time with food prep time. If I arrive at Specialty's without an order already placed, I would rather l

      • I'm guessing when you say "no one had to wait" you actually mean "I didn't have to wait". From what I've seen, Starbucks prioritizes mobile orders. My personal experience has been that walk-ins now wait longer because the service personnel keep getting interrupted by new mobile orders.

        >/quote>

        have you ever watched them make the drinks at Starbucks? They literally have a printer that prints out one label after another and the grab the bottom most label and start making that drink. What you don't realize, because you can't see them, is that those people placed their order before you and therefore were prioritized over you because their drinks could already be completed. And it's not always sunshine for the mobile orders, either. I used to travel a lot for work and had dozens of free drinks built up from expensing morning coffee at Starbucks. When that all ended, I decided to start using my free drinks while I was walking my dog in the mornings. I would place my order when we were 10 minutes away. This Starbucks was incredibly busy and the 5-7 minute drink queue was never that optimistic. Sometimes I'd wait 15+ minutes for the drink I had already paid for, only to see that people who were coming in after I had already arrived were getting their orders. It turned out that their queue would get so long that sometimes a label would touch the floor before they got to it and stick there. When that happened you had to interrupt someone and make them look on the floor so they could see they hadn't fulfilled your order. It was very irritating.

    • by cyn1c77 ( 928549 )

      I used to hate going to starbucks because it took 5-10 minutes of waiting in line just to order a cup of drip coffee. My time is too valuable to piss it away doing something like standing around.

      Now i place my order from my phone as i am rolling out of the drive way in the morning. 7-9 minutes later when i get there it's on the counter with my name on it. They didn't need a person to take my order and no one had to wait. This is the what innovation is all about folks.

      On a side note, when i go into starbucks to get my drink now, there normally isn't even a person working the register. Everyone is making drinks for mobile orders and the drive thru. Much more value added use of resources.

      I bought a nice espresso machine for $300 (that's ~60 Starbucks drinks). Now i place my order in my own mind as i am rolling out of the bed in the morning. 7-9 minutes later it's on the counter with my name on it. I didn't need a person to take my order and no one had to wait. This is the what innovation is all about folks.

    • Re:Innovation (Score:4, Insightful)

      by Subm ( 79417 ) on Monday December 11, 2017 @08:25AM (#55715053)

      > My time is too valuable to piss it away doing something like standing around.

      Written browsing Slashdot.

  • News flash: front-end automation can lead to more orders being sent to the back-end. The next step is back-end automation "to keep up with increased volume", and then the employee count will be fully reduced. Fast food is intended to be cooked precisely according to an algorithm already, so I expect cook-bots will be ordered shortly afterward.

  • by taustin ( 171655 ) on Monday December 11, 2017 @01:00AM (#55713883) Homepage Journal

    McDonald's corporate is apparently putting a brutal amount of pressure on franchisees to force customers to use the "self serve" kiosks they've force all the stores to install (and considerable expense), and they apparently measure what percentage of sales are rung up on those kiosks.

    One local McDonald's just stopped manning the registers as much, and the service there sucks donkey balls. The other one, clever bastards that they are, simply station a cashier at the kiosk and use it as a cash register. They even had somebody build a little wheeled cart for drink cups. The only difference between that and the other registers is that they don't take cash there - you have to go to the regular counter register to pay.

    No difference to the customers, no difference to the employees, corporate is happy, it's win/win/win.

    Be careful what you measure, because that's what you'll get.

    • No difference to the customers

      Yeah except the DIY being faster and letting employees focus on preparing food. Of course they will entice you to using it. That doesn't mean the end result is worse. It is only worse for those stubborn people who insist on lining up* when there's 5 empty self-serve kiosks behind them.

      The only time I ever line up at a McDonalds nowadays is when there is no self serve kiosk.

      No difference to customers, other than having eliminated queues, put the full menu on display right in front of them, showed complete co

      • The mistake they made was not putting in an interface at each table, thus eliminating the milling mob in front of the pickup counter.

        Imagine if you walked into McDs, sat down and ordered, and then a staffer brought the completed tray to you when the order was filled.

        You could have the computer tracking how long people sit before ordering, how long they take to eat, and how long it takes staff to confirm the table is cleaned after they go. (I'd give employees cards to scan at the terminal to confirm they che

  • by kenh ( 9056 )

    Although each branch employed fewer tellers, banks added more branches, so the number of tellers grew overall. And as machines took over many basic cash-handling tasks, the nature of the tellers' job changed. They were now tasked with talking to customers about products -- a certificate of deposit, an auto loan -- which in turn made them more valuable to their employers.

    I've never talked with a bank teller about a certificate of deposit or an auto loan - ever.

    I love how the authors gloss over changes in the banking industry, attributing all changes to the influence of atms...

    If I have a job at the local bank, and lose it when the bank automated, on a personal level, I take no solace in the bank i used to work for opening a new branch on the other side of town and creating a new position there - it may balance the score as far as job loss/creation goes, but I'm left unemplo

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