[Interactive Map] Minutes of work required to buy a…

There’s been lots of talk recently about minimum wage and impact on pricing strategies.  Food Genius decided to take a look at some datasets from our Pricebite service to understand the relationship between minimum wage and the prices of certain entrees at national chains.

We’re trying to answer the question of how long would a worker at these fast food and casual dining restaurants have to work to buy their own food.

For this exercise we took the average price by state for three main entree dishes at 3 major chains from our Pricebite service, and the average minimum wage by state for each of these states.

Items analyzed:

Steak Burrito from Chipotle

Chicken Parmigiana from Olive Garden

Bacon Cheeseburger from Five Guys

Click on each state to see the number of minutes required to work at Minimum Wage in that state:

We noticed significant overlap between the top ten states, in terms of minutes needed to work, between Chipotle’s Steak Burrito and the Chicken Parm from Olive Garden.  The states that were found in the top ten for both were VA, PA, NH, KY, ID, IA, and UT.

Surprisingly, not a single state is found in the top ten in terms of minutes needed to work at min wage among all three items.

From the pricing distributions for these items, we can see that there appears to be two different patterns of pricing for core items in national chains found thus far.

Though Olive Garden’s Chicken Parmesan is offered at a price about twice the hourly minimum wage, we find that it’s pricing is relatively elastic and correlated with states’ minimum wages. 71% of the variance in pricing can be explained by the relationship with minimum wage.

For standard dishes in other chains such as Chipotle or Five Guys, pricing between states is relatively consistent, with little variance between states with lower or higher minimum wages.

This is just a small analysis of the data. As we source new data from more chains and continue our analysis we will update our blog with interesting correlations as we find them. Stay tuned for more by signing up for our newsletter.

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