Month: May 2016

An artist's approximation of ex-McDonald's CEO Ed Rensi in his Fox Business appearance on Tuesday. (credit: South Park Studios)

For years, economists have been issuing predictions about how automation will impact the world's job markets, but those studies and guesses have yet to make a call based on what would happen if a given sector's wages rose. Instead, that specific guesswork mantle has been taken up by a former McDonald's CEO, who declared on Tuesday that a rise in the American minimum wage will set our nation's robotic revolution into motion.

In an appearance on Fox Business' Mornings with Maria, Ed Rensi claimed that a minimum wage increase to $15 an hour would result in "job loss like you can't believe" before ceding ground to our new robotic overlords. "I was at the National Restaurant Show yesterday, and if you look at the robotic devices that are coming into the restaurant industry—it’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who’s inefficient making $15 an hour bagging French fries."

When pressed, Rensi admitted that he thinks "franchising businesses" like fast-food restaurants are already hurtling towards automation, saying that those businesses are "dependent on people who have low job skills that need to grow. If you can't get people a reasonable wage, you're gonna get machines to do the work. It's just common sense. It's going to happen whether you like it or not." He then insisted that an increased minimum wage will make robotic worker adoption "just happen faster."

In 2014, Hewlett-Packard announced that it was splitting into two separate companies: Hewlett Packard Enterprise, selling servers and enterprise services, and HP Inc, selling PCs and printers. That split completed last year at the cost of more than 30,000 jobs. In a surprise announcement today, the company is about to embark on a second split: Hewlett Packard Enterprise is spinning off its IT services business.

The low-margin outsourced IT services business, which HP got into with its $14 billion acquisition of EDS in 2008, is to be merged with Computer Sciences Corp (CSC) to create a new company currently known only as SpinCo. HPE will own half of the new company, HPE CEO Meg Whitman will be on the new company's board, and HPE and CSC will each nominate half of the board members. CSC's current CEO, Mike Lawrie, will become CEO of the new company.

HPE says that the deal will save around $1 billion in operating costs. HPE shareholders will own shares in both companies, owning half of the combined company, with their stake valued at around $4.5 billion. They'll also receive a $1.5 billion cash dividend. Additionally, the merger will see some $2.5 billion in debt moved to SpinCo's books.

Nasdaq officials have told MassRoots, a sort of “Facebook for pot,” that it can't join the exchange.

The Denver-based social network has 775,000 users from the 24 states where marijuana is legal medicinally (including those states where it's also legal recreationally), who use the platform to find like-minded people in their area, learn about nearby dispensaries, and follow pot legalization news. MassRoots has said it meets the criteria for listing on Nasdaq—it has a $40 million market capitalization value and “well over 300 shareholders” through over-the-counter markets, according to CNN Money.

MassRoots alleges that the decision to deny the social media platform a place on Nasdaq was due to the fact that marijuana use and cultivation remains a federal crime. “On May 23, 2016, Nasdaq denied MassRoots' application to list on its exchange for being cannabis-related,” the company wrote. “We believe this dangerous precedent could prevent nearly every company in the regulated cannabis industry from listing on a national exchange, making it more difficult for cannabis entrepreneurs to raise capital and slow the progression of cannabis legalization in the United States.”