California Fast Food Prices Rise More Than Three Times Faster Than Statewide Inflation

For Immediate Release: February 23, 2026

Contact: Molly Weedn, molly@weednpa.com

Fast food prices up by more than 21% since 2023, compared to 6% statewide inflation

Sacramento, CA – Food prices at California fast food restaurants have increased by more than 21 percent since 2023, far outpacing statewide inflation which has risen 6.1 percent based on the most recent available Consumer Price Index data. The colossal increase follows the enactment of AB 1228, signed into law in September 2023, which imposed a nearly 25% minimum wage increase on fast food restaurants statewide.

Source: Dataseesntial; analyzed and presented by Protect Local Restaurants

Source: California Department of Industrial Relations – Consumer Price Index

“For many of us, raising prices was the last resort,” said Javier Gomez, a Rally’s and Capriotti’s franchisee based in the Central Valley. “But once the $20 minimum wage went into effect, we had no choice. To keep our doors open, pay our employees, and absorb higher operating costs, price increases became unavoidable.”

The impact has been felt across the state. Fast food prices have increased by more than 21% statewide, with prices rising 19% in Los Angeles County and 20% in Santa Clara County. These increases come as both jurisdictions consider additional, fast food–specific ordinances that would further increase costs for restaurant owners—all but guaranteeing even higher prices for consumers and more restaurant closures.

AB 1228 has had widespread economic impacts throughout California, including:

• 25,704 Jobs Lost: Seasonally-adjusted data from the U.S. Bureau of Labor Statistics’ Current Employment Statistics (CES),  shows California lost 25,704 fast food jobs since AB 1228 was signed into law in September 2023.
• Reduced Employee Hours: According to the U.S. Census Bureau and Bureau of Labor Statistics’ Current Population Survey – Outgoing Rotation Group (CPS-ORG), non-tipped restaurant workers in California lost a median of 5 hours per week after AB 1228 took effect—equivalent to nearly seven weeks or two months of work per year.
  • A survey of local restaurant owners confirms this data: Nearly 90% of local restaurant owners impacted by the $20/hour minimum wage reported reducing employee hours to offset rising costs, with 87% planning additional cuts over the next year.

• Restaurant Closures: Since AB 1228 was signed into law, fast food restaurants across California have been forced to close locations, delay new openings, or consolidate operations to absorb sharply higher labor costs, particularly in high-cost areas such as Los Angeles and Santa Clara counties. Each closure means fewer affordable meal options for families, fewer entry-level jobs, and fewer pathways to small-business ownership—especially in communities that rely on fast food restaurants as neighborhood anchors.

“It’s unfathomable that, given everything Los Angeles is facing right now, the City Council would consider targeting small business owners, many of whom are women and people of color, with even more costly regulations” said Bruce Kashani, a Los Angeles based Baskin Robbins franchisee. “With the cost of living on the rise, I know that these price increases are hard for our customers – they’re hard for us too. I hope that our leaders recognize the damage being done and stop the costly restaurant ordinance moving through City Council.”

“Santa Clara County is already seeing 20 percent price increases, and now officials are debating yet another policy that directly attacks fast food restaurant owners like me,” said Raghbir Mahli, a Santa Clara County based Subway franchisee. “With prices rising, businesses closing, and employees losing hours, the Board of Supervisors should know that the proposals under review would have devastating consequences for our community.”