By Katy Grimes
the Editor in Chief of the California Globe
By the time California Governor Gavin Newsom signed into law the $20 minimum wage for fast food workers, he had been warned by many that it would be devastating for the industry, but he did it anyway. Now, 16,000 fast food jobs have been lost and fast food prices are up more than 14.5%. And here is why: the $20 minimum wage harms California’s least skilled and least experienced workers, as they are no more productive, but are significantly more expensive, and results in harms the business owners as well.
This week, new data released from the new Bureau of Labor Statistics Quarterly Census of Employment and Wages (QCEW) shows that California has now lost as many as 16,000 fast food jobs.
The Bureau of Labor Statistics Quarterly Census of Employment and Wages includes mandatory reports from industry employers. The Employment Policies Institute reminds us that “this dataset is the gold standard for economists, and has been lauded by even Newsom’s favorite economists as the best on-the-ground look at a sector’s economic situation.”
A new analysis from the Employment Policies Institute of quarterly data from the Bureau of Labor Statistics revealed that California has lost as many as 16,000 jobs since the state’s $20 fast food minimum wage law was signed in September 2023. (The state is down nearly 14,000 jobs since the law officially took effect in April 2024.) The data includes mandatory reporting from all fast food establishments and covers the first six months since the implementation of the law. See the monthly changes here:
The Globe reported on the last study in February by the Berkeley Research Group, which proved that California’s $20 minimum wage for fast food workers has led to job losses, higher food prices, and increased automation in the industry.
The BRG study found, “California’s fast-food restaurants lost 10,700 jobs between June 2023 and June 2024, making it the worst performing year outside of a recession, and the COVID-19 pandemic. Additionally, food prices at local restaurants have increased by 14.5% since the legislation was signed, nearly double the national average.
Now we find that with the employer’s jobs report that California’s fast-food restaurants lost 16,000+ jobs.
AB 1228 was signed into law in October 2023 by Governor Gavin Newsom, creating the new $20 minimum wage for fast food employees – a massive 25% increase from the $16 minimum wage.
The increase to $20 minimum wage for fast food workers went into effect in April of 2024.
“The propaganda coming out of Newsom’s office and the SEIU is completely out of touch with reality,” said Rebekah Paxton, research director at the Employment Policies Institute. “The data definitively shows thousands of jobs have been lost due to this harmful policy, and hardworking Californians are left feeling the burden. The Fast Food Council should immediately halt discussions on increasing the fast food minimum wage further.”
EPI offers additional Background:
- A study by the Berkeley Research Group found that menu prices have increased 14.5% due to the $20 wage hike;
- After the implementation of the $20 minimum wage law, an EPI survey found that a majority of restaurants say they had raised menu prices (98%), reduced employee hours (89%), limited employee shift pick-up or overtime opportunities (73%) and reduced staff or consolidated positions (70%) as a result of the minimum wage law;
- Additionally, a majority of restaurants surveyed said in 2025 they will have to continue to raise menu prices (93%), reduce employee hours (87%), reduce staff or consolidate positions (74%), and limit employee shift pick-up or overtime opportunities (71%).
Katy Grimes, the Editor in Chief of the California Globe, is a long-time Investigative Journalist covering the California State Capitol, and the co-author of California’s War Against Donald Trump: Who Wins? Who Loses?
