California – Following California Governor Gavin Newsom’s legislation raising the minimum pay for fast food workers to $20, new Bureau of Labor Statistics (BLS) data shows a notable drop in employment in the industry. About 16,000 jobs have been lost since AB 1228 was adopted in April 2024, raising serious questions on how wage regulations affect employment stability.
Enacted to raise earnings from the former state minimum of $16 to $20, the Act sought to raise living conditions for low-paying food industry employees. Nonetheless, the most recent BLS numbers show a significant decline in employment; about 14,000 of these job losses happened in the six months following the law activation.
Having to deal with a 25% rise in labor expenses, companies have responded by lowering worker counts, decreasing work hours, and raising menu pricing. The Employment Policies Institute’s research of the BLS data shows that this change appears to have had a significant impact on the sector. Fast food employment across the state have consistently dropped monthly in the immediate aftermath…