For Immediate Release: April 1, 2025
Contact: Molly Weedn, molly@weednpa.com
Data shows 22,717 fast food jobs lost, a 14.5% spike in food prices, and widespread cuts to employee hours since California’s 25% wage hike for fast food workers took effect one year ago today
Sacramento, CA – One year after California’s $20 minimum wage for fast food workers took effect, the impacts are undeniable: thousands of jobs lost, higher food prices and growing uncertainty for family-owned local restaurants.
On April 1, 2024, Assembly Bill 1228 (AB 1228) increased the minimum wage for fast food workers to $20/hour—a 25% overnight wage hike. Since then, the increase has triggered a wave of economic consequences for local franchise restaurants, consumers and fast food workers alike.
Data confirms the damage of California’s $20 fast food minimum wage law:
- 22,717 Jobs Lost: New seasonally-adjusted data from the U.S. Bureau of Labor Statistics’ Current Employment Statistics (CES), released March 28, 2025, shows California lost 22,717 fast food jobs since AB 1228 was signed into law in September 2023.
- 14.5% Increase in Food Prices: A recent report by the Berkeley Research Group found food prices at California’s fast food restaurants have surged by 14.5% since September 2023—nearly double the national average of 8.2%.
- Nearly 90% of Impacted Restaurants Cut Employee Hours to Offset Costs: A survey of local restaurant owners impacted by the $20/hour minimum wage law revealed that 89% reduced employee hours to offset rising costs, with 87% planning additional cuts over the next year.
“This massive wage increase—the largest in the state’s history—has had devastating consequences for small business owners like me,” said Romy Uppal, a Santa Rosa-based Sourdough & Co. franchisee. “I’ve had no choice but to raise prices and reduce operating hours at my restaurants just to keep the lights on. Even then, the financial strain is relentless. I’ve been offered opportunities to expand in California, but the business climate is just too risky. Every new mandate makes it harder to survive—let alone grow.”
“In the highly competitive world of small business ownership, the deck is already stacked against Latinos—and this 25% wage hike has made it even harder,” said Lilly Rocha, CEO of the Latino Restaurant Association. “Local restaurants have been forced to make painful decisions—raising prices, cutting hours, and laying off employees—just to survive. This policy unfairly singles out an industry that has long been a pathway to small business ownership for marginalized communities. The Fast Food Council should know that another wage hike would be the final straw that forces many Latino-owned restaurants to shut down.”
Despite these challenges, the California Fast Food Council is set to discuss a potential wage increase in May. Recently, more than 1,000 local restaurant owners sent a letter to the Fast Food Council and Governor Gavin Newsom, urging them to halt these discussions and consider the real economic harm already inflicted on small businesses, workers and consumers.
In summary, AB 1228’s $20/hr minimum wage for fast food workers has resulted in:
- 22,717 fast food jobs lost in California
- 14.5% increase in food prices at California’s fast food restaurants
- 89% of impacted restaurant owners reported reducing employee hours to offset labor costs