May 10, 2021

The franchise group that owns the Sioux Falls-area McDonald’s restaurants is making a multimillion-dollar investment to increase pay.

“This year and last year are unconventional,” said Jordan Hartshorn, who became the sole franchisee for the Sioux Falls market late last year.

“But I think for us, it’s a good pivot point for our employee value proposition. Are we remaining competitive and relevant in our job market? We have tons of third parties we work with to analyze wages in our communities and other benefits that go along with it. Wage is one of the top three criteria, always. Treatment is in there and making sure they’re not overworked, but pay always hovers. We said we’re ready to make a jump on employee pay.”

Starting wage will go from about $11 per hour to $13 per hour.

“And that’s just to start,” Hartshorn said. “A crew person with some experience will be making $13 to $14, and it escalates up.”

A development manager in charge of training new crews will start at $15 per hour and make up to $16.50.

“And the next level is assistant manager, and they’re moving up even more from roughly $13, and they’re going to start at $16.50 and be in the ballpark of that and $18 an hour, and that position is one where you’re running a shift — breakfast, lunch or dinner … and once we get to that role, a full-time employee makes well over the median income for South Dakota.”

The state’s median income was $31,033 as of 2019.

McDonald’s department managers now will earn $18 to $20 per hour, a lead department manager will exceed $20 per hour, and a generation manager can make up to $85,000 per year.

Hartshorn estimates the changes will cost $4 million annually across his 17 stores.

“As we were doing the math on what this wage reset will do internally, I was like, this has a lot of commas in it,” he said.

“It’s a really good thing. Often, people associate McDonald’s with not giving a living wage or bottom-of-the-barrel wages or whatever … and it’s a stereotype we’re always fighting.”

Being able to offer employees more is exciting, and “one of the cool things is we’re not going to the menu board to make up these margins. That’s the last thing we want to do is lose customers who are used to value.”

The plan is to achieve that gap “through the operations,” he continued. “Getting faster in the drive-thru, having faster kitchens, really increasing retention and crew size. We’re hoping even in the Sioux Falls market to hire an additional 200 people this summer.”

The new wages start May 17.

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