McDonald’s CEO raised criminal concerns for business in Chicago


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Corporation CEO Chris Kempczynski said the burger giant is struggling with violent crime, homelessness and drug addiction in its Chicago restaurants and is calling on city and business leaders to address the problem.

Crime is taking a toll on Chicago, where McDonald’s is working to bring corporate workers back to its headquarters after the Covid-19 pandemic, Mr Kempczynski said in a speech at the Economic Club of Chicago on Wednesday. The company is trying to convince its employees that it is okay to return to the city center and travel by public transport again, he said.

“Everywhere I go, I get the same question. ‘What’s going on in Chicago?’ Mr. Kempczynski said. There is a general perception that our city is in trouble.

A spokeswoman for Chicago Mayor Lori Lightfoot had no immediate comment.

Mr. Kempczynski announced Wednesday that McDonald’s intends to stay in Chicago and that the company will create a new innovation center next to its city headquarters. Mrs. Lightfoot He said the move would help attract more visitors to the city.

After years of operating in Illinois, three major companies — Boeing, Caterpillar and Citadel — are moving their headquarters out of the state. WSJ looks at the economic and political implications. Photo credit: Laura Kamerman

McDonald’s estimates the total economic impact on the Cook County economy in the 12 months ended June 30 was about $2 billion.

Other US restaurants and retailers have cited violent crime in their stores as a growing problem following the outbreak. Starbucks Corporation

Sex 5.53%

In July, it announced it would close 16 U.S. cafes after employees reported drug use and disruption in the cafes, and the company said it was considering additional closures in response to employee concerns.

Many major companies including Boeing Co.

B.A 1.32%

and hedge-fund firm Citadel LLC, which announced this year that it will move its headquarters from Chicago. Citadel CEO Ken Griffin said the decision to move Citadel from Chicago to Miami for a better corporate environment was also a consideration, company officials said.

Boeing said in May that moving its headquarters from Chicago to Washington, D.C., would bring the aerospace company closer to customers and engineering staff. Kellogg Co.

It said in June it would move its global snack operations to Chicago as part of its decision to split the business into three companies.

Mr. Kempczynski said the exodus of large companies from Chicago should not be overlooked by government officials.

Data from the Chicago Police Department shows that from the beginning of the year to September 11th, homicides were down 15% compared to the same period a year earlier, while robberies were up 65%.

According to the department, overall crime is up 38 percent compared to last year and 19 percent higher in 2019 compared to the same rate before the outbreak.

Mr. Kempczynski, who lives in Chicago with his family, said: “Every day in our restaurant, we see what’s going on in the community at large.” “McDonald’s is not going to solve it on its own. We should be able to do it with the public sector as well.

Mr. Kempczynski said a more transparent plan is needed to assess the city’s health, and that business and government leaders need to work together to create clear metrics. Recruiting to join the thousands of people who work at McDonald’s headquarters has become more difficult than it was a few years ago, Mr. Kempczynski said.

Starbucks Chief Financial Officer Rachel Ruggeri said Wednesday that the coffee chain believes it has a few more stores to close around the country based on crime concerns, but will continue to evaluate security as it reviews its store network.

“Our goal is not to have a store where associates work and their safety is compromised. That’s not a good experience,” Ms. Ruggeri said in an interview, referring to the company’s staffing time.

Meanwhile, Mr. Kempczynski said in a wide-ranging speech that a newly passed law in California that would establish a state-appointed council to set wages for fast-food workers was “terrible policy.” McDonald’s said it needs to do a better job of advocating for the position regarding state laws that affect the business, as labor groups have successfully done.

McDonald’s has recovered sales and earnings, but executives have warned about inflation and macroeconomic uncertainties around the world. Mr Kempczynski said on Wednesday that he was worried about rising inflation, particularly in Europe, and that the outlook for the global economy could darken next year.

“Looking at 2023, I see a lot of challenges,” Mr. Kempczynski said. “Maybe we’re headed for a small recession in America, maybe a more significant recession in Europe.”

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