Nearly 10,000 California Fast-Food Jobs Lost Since Newsom Signed $20/Hour Minimum Wage Law

Nearly ten thousand fast-food jobs in California have been eliminated since last September, when Democrat Governor Gavin Newsom signed a law raising the minimum wage for these jobs to $20 an hour, new research by a trade group reveals.

“Since AB 1228 was signed into law last September, California fast-food restaurants have cut nearly 10,000 jobs, representing a 1.3 percent change from September 2023,” the California Business and Industrial Alliance (CABIA) reports.

The law targeting fast-food restaurants, which went into effect on April 1, raises the fast-food minimum hourly wage to $20 - $4 higher than the state’s $16 minimum for other employees. 

In response, chains like Burger King and In-N-Out Burger have been forced to raise prices. Others, like Mod Pizza and Fosters Freeze have simply closed stores following the increase in operating costs.

But, the new law doesn’t stop with raising the fast-food minimum wage just once.

It also “establishes a fast-food regulatory council with the authority to raise the industry’s minimum wage annually,” CABIA explains.

“Across my ten locations, the increase in the wage rate is going to cost me $470,000. It’s just about $50,000 per location,” CABIA Pres. Tom Manzo, who owns multiple fast-food franchises in the state, told Fox Business in an interview on Wednesday.

An article by One America News Network details a sampling of the fallout from the new mandated minimum wage:

“A number of well-known establishments, such as McDonald’s, Burger King, and even the budget-friendly In-N-Out Burger, were forced to raise their prices to make up for the increased pay.”

….

“The regulation forced the popular Mexican chain, Rubio’s Coastal Grill, to close 48 of its sites in the state last week.”

On Wednesday, Rubio’s Coastal Grill filed for bankruptcy.

“In the weeks before the wage hike went into effect, some California fast food owners began letting go of workers in anticipation of the increased labor costs,” Fox Business reports, citing the case of the Southern California Pizza Co., which announced layoffs of more than eight hundred delivery drivers in December of 2023.

The business and economic reporting of CNSNews is funded in part with a gift made in memory of Dr. Keith C. Wold.

https://mrctv.org/blog/craig-bannister/nearly-10000-california-fast-food-jobs-lost-newsom-signed-20hour-minimum-wage