Fast-Food Industry Turning To Sketchy AI Amid Labor Woes

As the American fast-food industry faces skyrocketing labor costs and continuing shortages of willing workers, integrating artificial intelligence (AI) in drive-thru services is becoming more prevalent. The new technology comes with new challenges, as reports show that AI often requires human intervention to function properly — or at all.

Presto Automation, an AI company serving major fast-food brands like Carl’s Jr., Hardee’s, Del Taco, and Checkers, has developed an AI “chatbot” to interact with customers and process drive-thru orders. While the system is intended to reduce human labor, results have been less than satisfactory. The company has admitted that “off-site agents” are involved in over 70% of drive-thru orders to address system errors or deal with incorrectly processed order inputs.

The most commonly reported error involves misunderstanding what customers are asking for at the drive-thru menu board and speaker. When they receive food they didn’t order, or things they asked for are left out, the errors invariably lead to unhappy customers and significant additional company time needed to correct orders.

The off-site agents hired to support AI fast food systems are often based in third-world countries with low wages, as steadily rising U.S. labor costs are driving more jobs offshore. Almost every American is familiar with the frustration of dealing with offshore customer service agents who face language and culture barriers in their work. The frustration of dealing with a language barrier on a business call is now coming to the daily experience of ordering a combo meal with a diet soda.

The economic argument behind the fast food industry’s drive toward AI and offshore labor is deeply rooted in the response to increasing minimum wages in the U.S.

Many conservative economists argue that minimum wage laws are a barrier to entry for people with limited work experience or skills. If the mandated wage is higher than the value an individual can produce, it disincentivizes companies from hiring them. The unintended rise in unemployment that results is typically most prevalent in entry-level positions like those in fast food.

Notwithstanding the technological hurdles, much of the fast food industry remains committed to advancing AI systems. Presto plans to expand its services to 1,200 sites by 2024.

The journey toward AI-driven fast-food services will be beset with growing pains, lowered customer satisfaction, and greater unemployment among the Americans who most need entry-level wages.