Can You Live On A McDonald’s Wage In Australia?

Can You Live On A McDonald’s Wage In Australia?

A much-discussed article doing the rounds this week examines how much a McDonald’s worker can make in a full-time job in the US and whether that would constitute a viable living wage. Does the same logic apply in Australia?

The post by Death And Taxes takes as its starting point a sample budget developed by McDonald’s for use by its staff. It then suggests how that money might be spent: Here’s an example quoted in the post:

The really astounding thing about this calculation is that it includes two jobs, both of which are effectively full-time. In large part, that reflects a very low minimum wage in many US states. Whether the other figures in the sample budget are accurate is also open to dispute. Even if they are, having to work two full-time jobs for mere subsistence living seems appalling.

In Australia, the situation is somewhat different. For full-time adult workers, we have a nationally mandated minimum wage if there isn’t an enterprise agreement in place. McDonald’s has such an agreement, so we can work with its figures.

The version voted on for 2013 in NSW gives a good indication of what gets paid at the moment. (Those numbers would vary from state to state, but they serve as a basis for discussion.) These are the figures for a full-time (40 hours per week) Level 2 worker per week and per month, based on age, as of June 24 this year:

Age Weekly Monthly
21+ $695.41 $2781.64
20 $625.87 $2503.48
19 $556.33 $2225.32
18 $486.79 $1947.16
17 $417.25 $1669.00
16 $347.71 $1390.84
15 $278.16 $1112.64

Clearly, if you were a budget-minded McDonald’s franchise owner, you would employ as many good teenagers as you could find and let them worry about living on $1112 a month. However, it’s also reasonable to assume that people under 18 are going to be living at home in many cases and not responsible for the same range of expenses.

In terms of this comparison, note that even for a 19-year-old, the sum total for working one job is higher than the equivalent worker in the US manages with two jobs, so life is automatically looking a little better. For the rest of this discussion, we’ll use the 19-year-old as an example. (Note: I’ll also ignore the potential existence of travel allowances or other benefits, since these aren’t disclosed as openly in public documents.)

The first important point: those are pre-tax figures. A worker on these wages definitely benefits from the higher tax-free threshold that currently applies in Australia. Anyone who earns less than $18,200 a year pays no tax; this job isn’t under that threshold, but only about $10,000 of the annual income is actually taxable. If this is the sole job, the tax taken out each week will be $47, leaving the earner with $509.33 a week, or $2037 over the month.

Now let’s build a provisional budget for our McDonald’s worker. I’m skipping several elements from the US budget. For starters, I haven’t included health care, since we do have Medicare. For the phone, I’m presuming $40 a month for a prepaid unlimited mobile. The food budget is a not-quite-Mastercheap but hardly generous $50 a week (I’m guessing you’d get at least some food at work). The other figures are definitely open to discussion and subject to a lot of variables (including where you live and the distance to your work).

Category Monthly
Monthly income $2037
Rent $600
Car payment $500
Car costs $100
Phone $40
Electricity $50
Food $200
Spare/savings $747

That leftover $747 for a month might sound OK, but bear in mind that I haven’t included savings, purchasing clothes, medical emergencies, child care, additional health insurance, visits to the laundry, unexpected mechanical disasters, or any kind of social life. The budget definitely looks better (and more realistic) than the US one that has been (quite rightly) derided, but it doesn’t look like a lifestyle anyone would want to sustain indefinitely.

What can we all learn from this? Firstly, that we’re massively better off living in Australia than the US. Second, that on a minimum-wage budget, life is still very tight. Additional insights from former or current McDonald’s workers (or other low-wage earners) welcome in the comments.

Lifehacker’s weekly Loaded column looks at better ways to manage (and stop worrying about) your money.


  • If we were to assume they were living in one of the major cities and paying $600 p.m rent, I think it would be safe to assume they’re sharing the rent with someone else. $600 p.m each. It would be very hard to live independently with $2037 p.m thats only $24K p.a after tax. I once had a friend tell me that a person would need to make around $60k p.a after tax to live independently and comfortably which works out to be around $5k p.m

    • ??
      I don’t earn 60k BEFORE tax and I’m managing quite nicely supporting a stay at home wife, kid and $400k mortgage

    • haha you can easily live in Australia for under a net income of $60K, its called not going into debt and living within your means. You’re friend is delusional.

      • In the larger context of this discussion I had with him, what he meant from comfortably, was not worrying about bills, not living week to week, not having debt, being able to go out most weekends, being able to go on holidays without too much sacrifice, and putting a bit away each week. So basically enough where you don’t have to worry about how much money you’re making. Seems ideal for a single bloke like him without a family to support.

        • Its all relative isnt it. If you spoke to someone born into the rothchild family they probably think you couldnt live “comfortably” on under a million a week. But truth of the matter is you can live comfortably on a lot less than $60k net in Australia, and still be more “comfortable” than 90% of people that live on this planet.

          You don’t need a high income to have no debt, you just have to have impulse control and pay cash for your purchases and live within your means. Speak to your grandparents/great grandparents and they can tell you how to manage money without debt.

        • I can do all of that on disability support pension from centerlink. If your mate wants to go on holidays (presumably overseas) without at least some sacrifice then he’s living in a fantasy world. There’s no such thing as not worrying about how much money you’re making. Why do you think CEOs and other executives are always pushing for more money? If he can’t do everything you’ve suggested on less than 60k post tax, then he’s either mis-managing his money or has his expectations way too high.

  • Ok, $600 Rent per month ? I am not too sure about NSW, but a single bedroom unit in a shady suburb of Perth costs not less than $300 a week.

    Rent in the US of A is a lot cheaper than Australia.

    Also please include Hungry Jacks too. They pay pretty much the same.

    • My rent estimate definitely assumes sharing with someone else (quite probably with multiple people).

        • In the USA you can indeed rent a small unit for 600 p/m. However your bring home pay is also significantly smaller than Australias. So it ends up working out around the same.

      • I still think its a bit too low. That’s 150 per week, and I don’t know anyone paying less than $180 per room in Sydney. Maybe in one of those out of the way suburbs in GWS, but then your travel costs are a gross underestimate.

    • I was so surprised by that when I moved to Fremantle for a few years. I’ll tell you, you could get away with it out here in Western Sydney for a studio, or similar, maybe a granny flat.

  • As far as I know, maccas in the US don’t pay their employees health insurance. Last I heard, it was around $600 a month for a very basic package….

  • The US budget doesn’t contain a food budget… is that supposed to come out of spending money?

  • Great post, to add to it mcdonalds employees in Australia also have access to a huge range of discounts from over 300 retailers (which includes phone/interent/insurance), and can get between 5%-25% off lots of these. (They worked it out that if you were to fully utilise the benefits as a full time employee you would be able to save up to 2.5-3k a year in costs of living) Speaking from personal experience mcdonalds aus also provides massive opportunities to earn way more than the enterprise agreement they have, if you have a good work ethic.

  • I’m a student living on a centrelink payment: $625 per fortnight including rent assistance etc.
    I pay $195/week rent for a room in a 5 bedroom flat (I’m in eastern Sydney, near my uni)

    A full time Maccas wage would seem like luxury to me!! 😀

      • Unfortunately, the whole point of being on centrelink while you are a student is so that you dont have to cut into your study time in order to live.

        I know that a lot of people successfully get through university while working full time and studying full time, but speaking as someone who has been in both situations (working full time + studying full time, and also studying full time + centrelink benefits + a very light casual job for spending money) I have to say that my studies always, always suffered as a result of working full time. The weird part is that the centrelink benefits are supposed to be a government downpayment/investment in the student, so that the person can get a degree, and use that to get a high paying job so they can pay more taxes in the future, but they can’t seem to understand the fact that the scheme doesnt really WORK if the student ends up living ~40% below the official australian poverty line.

        TL;DR Full time students get a bum rap, whether they choose to work, or stay on centrelink benefits.

        • How do they get a “bum rap” if they choose to work and study? I worked full time while doing a full time 4 year degree and still managed to graduate with honours and receive a full scholarship for a 3 year research masters (which I also completed while working full time – where full time work was on average 60 hours a week). Many of my friends managed the same.

          I don’t believe the Centrelink payment is meant to be the investment in the student, although it does contribute to it. The investment in the student is subsidised education costs (I think we pay 25% or so of the total cost – may be more now) and low interest loans (HECS & SELF etc).

          TL;DR; I think a lot of students are just undisciplined and/or lazy.

          • 60 hours a week is stupid. Were you studying during the great depression or something?

      • Answer to what, tim?

        I wasn’t asking a question, or submitting a problem and hoping for a solution.

        The size of a Macca’s wage depends on where you look at it from, and as someone living on far less I can categorically confirm that yes you absolutely can live on a Macca’s wage.

      • Or, he could stick with his education and vastly increase the benefits to both himself and society.

        Australia: where self-improvement is a sin and mediocrity makes you a ‘good bloke’

    • ha ha I got $80 a fortnight when I was studying full time and tried to get assistance… what a joke!

      • Haha I’m not entitled to anything from the government in terms of youth allowance etc because my parents have too many assets, just because my parents have assets and are well off doesn’t mean they give any of it to me

  • $50 a week for food? I guess people are right when they tell me I eat too much…

  • Angus, My biggest concern is your allowance for “Car payment.”
    People on minimum wage should not be paying off a car at $500 a month. They should be driving a car they paid cash for, at $500-$1500 total.

    • Jake — good point. Though then maintenance expenses would be higher in that case.

      And in Australia, I really doubt there are many $500 cars around, since they wouldn’t pass annual roadworthy inspections (or would cost thousands to meet those standards).

      Ideally, on this wage you wouldn’t own a car at all, but that’s a relatively rare scenario in Australia.

      • Come out west Angus my man, I’ll show you PLENTY of $500 cars… I used to love having a crappy car. The missus now works for a car company so we get cheap leases but a good $500 bomb will do anyone well if your smart about it. I can’t believe so many people complain about having no money while driving a brand new car, such a waste.

      • Though then maintenance expenses would be higher in that case

        You’ve been speaking to your mechanic again.

        5 litres of oil is cheap, and brand new cars need it just as often as 15 year old cars.

        • yearly car rego, new tyres & CTP all add up as ‘maintenance’ & are expensive.

          • Yes but those aren’t expenses that would be higher in this case.

            …well they might actually but it’s generally not what we are referring to when we talk about bombs needing maintenance, which is more of the ‘oh my engine just exploded’ variety.

          • yearly car rego, new tyres & CTP all add up as ‘maintenance’ & are expensive.

            and brand new cars need it just as often as 15 year old cars.

    • Yeah after my mortgage, $559 per month car repayment is the next biggest bill. Then $349 for the Mrs’s car.
      But even a brand new $14k kia rio or something small like that would only cost $270 per month on a 5 year loan… and that’s brand new.
      I think it needs to be pretty obvious that if you are on minimum wage, you’re not driving an expensive new car, living alone, going out every night and having lots of expensive hobbies.

      If you live within your means i don’t think it’s too bad.
      If I lived in a share house, and worked at maccas, I’d ride a bike, since there’s always a maccas “just down the road”.

  • Ah, as I suspected. I could have made more working full-time at Maccs than I was at my desktop support job. And I didn’t even get free fries with that.

  • This is all under the assumption that as a 19 year old you would be getting full time work. For that, you would have had to start as a teenager at 14/15, and worked your way up. Coming into a Maccas job at 19, and having to start from the bottom, you would be earning about as much, (if not LESS) than that full time 15 year old. Simply because you would not be getting as much shifts. Managers do this when they don’t hire teenagers and to help keep down the payroll costs. Very rarely do people over teenage years get full time. I was 22-23 and my hourly rate was equal to if not more than the Head/assistant managers, who were either my own age or just a couple years younger. But I was lucky to work more than 10 hours a week.

    So THEORETICALLY if you were say 18-19+ you could live off a maccas wage, on the proviso that you were employed full time. In reality, it’s impossible.

  • There are some weird figures here. First up, the monthly wage quoted, $2037, doesn’t match any of the wages figures given. $500 a month for car payments? I just bought a brand new car and that’s what I’m paying. My last car was more the kind of car a Maccas worker might own – a small used hatchback that cost me $7000 – and repayments on that loan were just over $100 a month, over 5 years. (I was out of work when I bought it.) Even paying it off over two years was only $400 a month (which is what I did when I got a job).

    There are also no internet costs here and that is something that’s hard to get by without. So add in another $30 a month for that. $100 a month for car expenses is also a little light. I only do about 100km a week and even that costs around $20 in fuel, which doesn’t leave much for rego and insurance. I think something closer to $150 is in order there. As someone who lives alone, I can tell you $50 for food is absolute bottom-line – generic everything and only the basics. You’d be eating nothing but sausages and cheap mince dishes and drinking generic cola. It might be OK for a vegetarian, though.

    If you look at it realistically, though, how many Maccas workers don’t live with their parents? I really do’t think it is the sort of job that gives you the freedom to move out of home.

  • This is my actual budget

    Description Amount
    Salary 4000
    Gym -60
    Internet+TV -120
    Mobile -70
    Grocery and Food -700
    Rent -1220
    Electricity -100
    Fuel -100
    Savings -200
    Money To Spend 1430

  • you missed gas & water bills, thats another couple hundred $$ / month (exp. when u live in colder climates & are dependent on gas for primary heating source).

    also missed, road tolls, public transport, bank fees (overdrawn much?), fines, taxes, etc…

    that $700+ excess would be eaten up pretty quickly.

    • If you’re renting you don’t pay for water and if you have gas you use less electricity so it balances out. Also, if yo uare paying $500 a month on car repayments you are not going to have much use for public transport. Tolls will also depend where you live and work. e.g. I live north of the Harbour so I pay around $30 a month but my mate lives in Bondi and only chalks up one or two tolls a quarter.

      • um, hang on..

        I rent. I pay for water & gas.. last gas bill (to heat a 2 bed apart. in melb) was $400 (for a 1/4; so that’s roughly $133/month). & in summer we sometimes are forced to use AC (on 40deg heatwaves) which costs additional electricity.

        true, if u own a car you don’t use PT as much, but if u own a car, you’ll have to pay additional Tolls; if u live in Melb it’s hard to avoid not paying one.. (& then there’s also the odd additonal parking ticket/PT fine).

        • So you can’t understand that someone without gas would be using electricity to heat their home in winter, thus raising their electricity bill? I’ve only once had a place with gas and gas+electricity was pretty much exactly the same as electricity alone in the flats I was in before and after.
          I have never in my life paid for water usage when renting. I’m not even sure it’s legal as water rates are not consumption based but calculated on the value of the land.
          Just to be annoying, I don’t pay any utilities at all and haven’t for the past two years.

          • I live with two others in a three bedroom terrace house in Sydney. We pay about $200/quarter in excess water charges.

          • OK, I’ve spent the last week asking around and I still can’t find anyone who has ever paid for water while renting.

      • You usually pay usage fees on water when renting. Electricity is not significantly cheaper by having gas. (Source: my situation)

        • I’m sorry, I’ve been renting since 1985 and I have never paid any costs associated with water usage, so to say that it is usual is ridiculous.

          • You are one person. For almost everyone else, who does have a separate water meter, they most certainly do pay for their own usage.

          • Well count yourself lucky. You would be very lucky to get away without paying water usage fees.

            Usual situation: Water fee goes via landlord / agent, for service charges. They then bill you for usage directly.

            Seriously, everyone does this.

          • No they don’t. If I count up the places I’ve lived in , I can tell you half-a-dozen who don’t. And it certainly isn’t just me, I don’t know anyone who rents and pays for water.

          • Sigh, I always forget when arguing with you you get holier-than-thou. Seriously, it is a thing. I don’t know what city you are in (I’m in Syd) but out of everyone I know renting around inner west and north, they pay for water. 6 places that you have lived in (especially since 1985) is not evidence that it doesnt happen.

          • You said “everyone does this” so 6 exceptions is 5 more than was needed to prove you wrong. I also live in Sydney, on the north side, and like I said, I’ve never heard of anyone paying for water until yesterday. I don’t think I’d sign a lease if they tried it on me.

          • I’ve lived in 4 different apartments and one house in Brisbane, and have never been billed for water by the landlord.

          • to my knowledge QLD’r’s aren’t billed for water (@ least i wasn’t when I lived there in 2001)..

            but victorians certainly are (we have a big desal plant to pay off) & I’m pretty sure NSW’r’s have to as well.. I have no doubt Ppl from SA would have to pay, seeing they are always short of water..

      • You can be billed for water in QLD if the property meets certain efficiency standards and is separately metered, and if it’s in the lease agreement. A lot of places aren’t up to the standard yet, so a lot of places you won’t pay for water, but some you will.

        Source: RTA QLD. See how I did that, with an actual source instead of anecdotal evidence?

  • As a real estate agent I don’t know many places available at $600p/m. Unless this was a contribution such as board or for a share arrangement. Cheapest these days is usually $200-$250p/w for a 1 bedroom (so over $1000 p/m) again this is just generalising and still doesn’t help this hypothetical minimum wager 🙁

    • I doubt a minimum wager wouldn’t be in a share house. Im in a brand new 5 bedroom place in Ashfield, 180 p/w. It would be silly not to.

  • Argument: I am a current full time student on youth allowance with rent assistance (approx $470 a fortnight).
    Supplementary info: I am independent, receive no undeclared income, and I pay for rent, food, utilities, car registration, insurance (house and car), and you know what, I live comfortably, enjoy a healthy video game addiction.

    I do this all comfortably on that income. For god’s sake, live within your means people.

    • Comfortably? How much rent do you pay?

      I find your “comfortably” extremely difficult to believe. I’m a student, I receive $625/fortnight, and pay $390 of that in rent for my room (eastern sydney).
      I survive, but only just, and it’s a very long way from comfortable, which makes me incredibly sceptical about your post.

  • This article only looks at the “Low income” earners in Australia, and I do agree with part of this article…. working at Maccas in say, Singapore would net you $4.20 an hour, which will pay $168 a week at most and considering the standard of living it would seem that Australians are much better off.

    However on the flip side, high income earners get taxed a ridiculous amount, the tax rates just scales exponentially to a ludicrous amount once you reach a certain threshold. I just filed my tax returns for this year, and 39 cents of dollar I make goes to the government…. I don’t think any other country in the world has such a high tax rate.

    TLDR : We’re probably all better off working full time at Maccas in Australia, or working in other countries if we want make much more then 18k a year. :S

  • Well I spend about $1600 per month in Sydney, saving 70+ % … it’s all about choices. From what I know nobody ever died from not having a car for example.

  • I’m on below the minimum wage. Yes, I’m working for an Asian boss who cooks the books, and pays all his employees between $8 – $13 per hour in the Melbourne CBD. New probationary workers get $8, full timers get between $9 – $10 depending on seniority. Employees who have worked for a longer time or are “important” to the business (eg: Chefs) get paid between $11 – $13. And somehow, we still get PAYG taxed (mine is about $1.20 taken out of my hourly wage of $11, so I get $9.80 net per hour).

    I work 40 hours, so take home pay is about $1700 a month. I am living alone, pay $650 rent per month, $50 per week on groceries which I cook 10 meals a week (monday to friday lunches & dinners), $20 on take outs for weekend, $20 for entertainment with friends on weekend, $132 for a Myki public transport monthly ticket, $11 monthly mobile phone bill with Vaya mobile ($500 worth of calls and 1.5GB data) , $30 monthly internet, $50 electricity,gas,water.

    So monthly expenses :
    $650 rent
    $200 groceries
    $100 (rounding up) for weekend meals
    $100 (rounding up) for weekend entertainment
    $132 public transport
    $100 (rounding up) utilities
    = $1,282 after rounding up on a lot of stuff

    Looking at my bank account now, I have $8000 saved in a high risk mixed fund (90% shares + 10% fixed income) which returns me about 7% pa. I managed to get this done in 18 months, right after graduation from Monash University.

    Yes, I am having it tough even though I graduated with honours and completed a Masters degree in commerce/finance. I am not even on the minimum wage, I am living on my own, I am happy with my life, I have some good weekends with my friends, am happy without having a car, and am looking into getting into a relationship. Of course getting into a relationship may add some strain on my savings, but I don’t expect it to be more than $200 a month.

    I don’t know how some of you spend your money. I guess not everyone is as thrifty as me.

    PS: In case you think $50 a week of groceries for 10 meals can’t get you enough nutrition, think again. I work out a lot at a gym which me and my friend shares a membership (he pays the full membership – he has a good job and a good heart, so didn’t mind me freeloading – and I eat plenty and still don’t spend a whole lot on food.

    PPS: The key, is to have as little cash in your wallet as possible, and have no credit cards on you. I cannot stress how important this little tip is 😉

  • I work at maccas here in AU i think it’s kind of sickening how mcdonalds can sign some bs agreement where they can exploit an ault for 13.72$. Whats more is that this article assumes a full time position. Believe ONLY the managers at my resturant work full time. Ive been begging for more hours and i still get 10-20hr work weeks.

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