California’s Minimum Wage Hike Leads to Nearly 10,000 Fast Food Job Cuts
Since the implementation of California’s $20 per hour minimum wage law, supported by Governor Gavin Newsom, almost 10,000 jobs have been cut from fast food restaurants across the state.
According to the California Business and Industrial Alliance (CABIA), the fast food industry has seen significant job losses following the signing of the law last year, determining the number to be nearly 10,000. Highlighting the impact, CABIA ran an ad in USA Today featuring mock “obituaries” for fast food restaurants.
“California businesses have been under total attack and total assault for years,” said CABIA president Tom Manzo to FOX Business. “It’s just another law that puts businesses in further jeopardy.”
Governor Newsom has disputed the report, with a spokesperson citing 2023 statics that fast food jobs were added in the state. Upon signing the law, Newsom claimed California was moving “one step closer to fairer wages, safer and healthier working conditions, and better training by giving hardworking fast food workers a stronger voice and seat at the table.”
Leading up to the wage hike, numerous fast food restaurants in California announced layoffs and price increases in response to the increased labor costs. Chipotle, for example, stated via its Chief Financial Officer that the company expected menu prises to rise by a “mid-to-high single-digit” percentage. McDonald’s also confirmed they expected to raise prices to counetrbalance the higher labor expenses.
Additionally, inflation has driven fast food prices to unprecedented levels. Fast food, initially intended to be a cheap and quick option for consumers, has seen dramatic price increases in the last few years alone. A survey by LendingTree found that 78% of Americans now consider fast food a “luxury” due to its higher cost.
