A group of 7-Eleven franchise owners is pleading with its corporate backers to reverse a recent order to resume 24-hour operations, saying their inability to recruit labor at current wages makes longer hours impossible and unsafe.
There are over 9,300 7-Eleven stores in the U.S. The majority are franchised and are represented by the National Coalition of Associations of 7-Eleven Franchisees. In a letter, the organization said franchisees are “feeling the squeeze.”
Earlier in the pandemic, the chain reduced hours in response to a drop in sales, reducing staff and adding strain on owners.
Recently, the corporate owners said franchisees should start operating 24 hours a day again.
“We are facing a crippling labor shortage, higher operating costs, lower gross margin and lower net profit,” read the letter in response to the announcement. “In many stores across the country, overnight sales barely cover the cost of paying a clerk to work that shift. And with the shortage of workers, many of us are forced to cover these shifts ourselves, causing stress to our health and our families.”
In an emailed statement, the corporate owners said: “7-Eleven remains focused on supporting and promoting Franchisee profitability, safety, and success. Since the start of the pandemic last year, 7-Eleven has provided Franchisees with more than $173.5 million in investment, savings, and support as they own and operate essential businesses on the front lines of their communities.”
Across the country, businesses say they are desperate to hire front-line clerks and service personnel to meet rising demand as vaccinations increase and states lift restrictions. Over 40 percent of small businesses say they can’t fill positions, according to the National Federation of Independent Business.
But these often lower-wage workers have been difficult to coax from the sidelines because of family obligations and the continuing pandemic. Of the 10 million Americans officially considered unemployed, over 4 million say Covid-19 concerns are keeping them from seeing work, according to the Census Bureau.
There’s also competition from extended unemployment benefits. Combined unemployment benefits can equal $600 a week, or about $16 per hour, more than many of the entry-level jobs pay. Some of the jobs are part-time, meaning the weekly pay is even less. Businesses are even resorting to offering hundreds of dollars in signing bonuses to attract workers.
A year of tough working conditions through the pandemic and a tight labor market have emboldened employees who are sick of working conditions and wages to grumble more loudly.
Workers at a Dollar General in Eliot, Maine, quit this week over what they said were low wages. They posted their goodbyes in a handwritten sign on the door, which went viral. “Closed indefinitely because Dollar General doesn’t pay a living wage or treat their employees with respect,” a sign read, the Maine Beacon reported. Workers were making $13.25 an hour.
Like other businesses, 7-Eleven franchises say they are having trouble recruiting workers and are squeezed by price and costs.
While they could raise wages and increase prices, “that creates a competitive disadvantage in the marketplace, which can adversely affect sales and profits,” the letter said.
“Every additional dollar a franchisee pays his or her employees comes off net profit,” the franchisees wrote. “As labor and other direct store operating expenses keep increasing, franchisees are earning less and working more.”
Stephanie Ruhle and Charlie Herman contributed.