Are Investors Lovin' It From McDonald's? (MCD)

McDonald's

this morning that it would be hiring 50,000 workers to fill restaurants, as business improves across the globe. While hiring is good for consumer sentiment, is it necessarily good for the stock? Generally an employee is one of the most expensive costs a company has. In addition to salary, most employees will offer some kind of benefits (good ones like McDonald's), training, and other perks of being an employee. Because employees are so expensive when it comes to a company's cost structure, they are also the first to go when a recession hits, as they are the easiest to shed. McDonald's hiring 50,000 people around the world indicates that the company would like to hire between three and four new hires per restaurant. So far, the market is applauding the move, sending shares over 0.5% higher as of the time of this writing. This should, and I emphasize should, that McDonald's is confident that the hiring won't hit profits, and should allow the company to remain as profitable as ever. These 50,000 new hires around the world probably will have their full impact until at least the third quarter, so investors will need to watch the price action of the company to see if the employees are adding more positives than negatives. Otherwise, shareholders won't be lovin' it.