Last month, Gov. Gavin Newsom, who signed the state law enacting the fast food wage hike last September, touted federal jobs data pointing to industry growth despite higher payroll expenses. Critics responded by highlighting a separate federal data set adjusted for seasonal variations, which shows relatively small job losses of about 2,200 from April through August in quick-service restaurants.
Statewide, there were approximately 737,000 fast food jobs as of last month, according to the U.S. Bureau of Labor Statistics. Most fast-food employees in California are adult women of color who, in 2022, made an hourly average of $16.21.
To mitigate the impacts on smaller businesses, the law Newsom signed in 2023 only applies to fast food restaurants in chains that have 60 or more locations nationwide to mitigate the impacts on smaller businesses.
The legislation also established a first-of-its-kind Fast Food Council made up of worker and employer representatives. It has the authority to keep increasing the industry’s minimum wage by up to 3.5% annually. At a council meeting in Los Angeles earlier this month, dozens of franchise restaurant owners requested the nine-member council hold off from mandating another increase.
Many said they struggled financially to cope with the current pay of at least $20 an hour, had reduced work hours or jobs and even closed stores.