Which Firms Offer Better Jobs for Low-Wage Service Workers? Evidence from Fast-Food Franchising.

This article investigates how firm characteristics and minimum wage laws influence job quality among fast-food franchisees, a key segment of low-wage service work affected by workplace "fragmenting" or "fissuring." Using a nationally stratified random survey of 837 U.S. fast-food franchisees matched with local minimum wage data, the study finds that larger and older franchisees provide more selective hiring, training, and employee benefits but restrict work discretion, employ fewer full-time workers, and offer lower weekly wages due to reduced work hours rather than lower hourly pay. In contrast, local minimum wage laws are the primary determinant of hourly wage rates but do not significantly affect other job quality dimensions. The findings highlight that while firm size and age shape certain employment practices, minimum wage increases remain the most effective policy tool for raising pay, though additional regulation addressing stable work hours may be necessary to improve overall job quality.