Wage hike triggers mass fast-food job losses in US state – report

Fast-food restaurants in have recently had to lay off nearly 10,000 workers, according to a major trade group

FILE PHOTO. © Getty Images / David McNew

Californian fast-food restaurants have had to slash some 10,000 jobs in recent months due to the state’s new minimum wage hike, according to a recent report by the California Business and Industrial Alliance (CABIA) trade group.

The report comes after California’s Democratic Governor Gavin Newsom signed a bill dubbed AB 1228 in September of last year, raising the state’s minimum wage from $16 to $20 an hour. The law came into effect in April and many companies have since been forced to close down, raise prices, or lay off employees.

CABIA president Tom Manzo has told Fox News that Californian businesses had already been and claimed that the state’s lawmakers were living in a if they thought that drastically raising wages would help workers and businesses.

Manzo said, insisting that

He also stated that jobs in the fast-food industry were never meant to be long-term or high-paying, calling it a in which people start out working as kids to gain a good work ethic for the rest of their careers.

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Last week, CABIA ran a full-page ad in the California edition of USA Today, featuring mock of restaurants that have been harmed by the new minimum wage law. These include popular chains such as Pizza Hut, Subway, Burger King, McDonald’s and Cinnabon.

According to the trade group, one taco chain, Rubio’s, has had to close as many as 48 outlets in the state due to the including 24 stores in the Los Angeles area, 13 in San Diego, and 11 in Northern California. 

Meanwhile, the owner of 140 Burger King franchises in the state has announced he will slash workers’ hours and expedite the rollout of self-service kiosks to offset the impact of the new minimum wage law. Similar measures will be taken by a McDonald’s franchisee, who said he will hike menu prices and delay renovations at his 18 restaurants.

As restaurants across the have also been forced to gradually raise their prices due to rampant inflation, a survey conducted by LendingTree last month has also found that nearly 80% of consumers now consider fast food to be a “luxury” purchase due to how expensive it has become.


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