Restaurants raise prices, reduce workers’ hours, and cut positions
– A recent survey reveals that nearly all fast-food establishments in California have increased their prices in response to the state’s new minimum wage law. The Employment Policies Institute (EPI) conducted the study, which found that a staggering 96% of surveyed restaurants have raised menu prices to offset the higher labor costs.
The law, which took effect on April 1, 2024, mandates a $20 per hour minimum wage for fast food workers in California. This represents a significant jump from the previous statewide minimum wage of $16 per hour.
According to the EPI’s findings, the average price increase across all surveyed restaurants was 9%. However, some establishments reported hikes as high as 20%, highlighting the varying impact of the wage law on different businesses.
The survey, which included responses from over 400 fast-food locations across the state, also revealed that 84% of restaurants have reduced employee hours or eliminated positions to manage the increased labor costs. Additionally, 67% of locations reported they have postponed plans for expansion or new hiring.