McDonald’s hikes prices to offset wage increases, supply costs
McDonald’s is hiking the prices of its menu items in an effort to offset wage increases and supply costs as the United States grapples with a labor shortage and supply chain crisis, The Wall Street Journal reported.
Compared to last year, higher-ups at the fast-food chain anticipate menu prices in the U.S. to increase to roughly six percent this year despite the fact that McDonald’s reported strong third-quarter results on Wednesday.
That’s because in McDonald’s U.S. restaurants, wages this year are up at least 10 percent as of now and supply costs for things such as food and paper are anticipated to increase four percent, according to the Journal. McDonald’s is having a difficult time trying to hire enough people to operate under regular hours.
Earlier on Wednesday, the fast-food chain reported that its U.S. same-store sales in the third quarter grew 9.6 percent compared to 4.6 percent last year during the same time. The chain noted that it was attributed to larger order sizes, increases to its menu prices, its crispy chicken sandwich and celebrity endorsements through its Famous Orders platform.
The news of McDonald’s increased menu prices comes as the U.S. battles a supply chain crisis and labor shortage that is disrupting a variety of industries. Given the rollout and effectiveness of the COVID-19 vaccines married with federal aid during the pandemic, demand is outstripping supply.
Some port closures, a lack of workers in places like trucking and other supply chain issues have contributed to a rise in prices for goods. Earlier this month, the White House announced that the Port of Los Angeles and several companies like FedEx would be working around the clock to alleviate some of the supply chain disruptions.
The Hill has reached out to McDonald’s for comment.