An anonymous reader writes: Assembly Bill 1228, the extremely controversial law that raised the fast food minimum wage to $20 an hour in California, turned one year old on Tuesday. And the differences between now and a year have been shown to be pretty stark.
According to the U.S. Bureau of Labor Statistics’ Current Employment Statistics (CES), 22,717 fast food jobs have been lost in the past year when seasonally adjusted. The Berkeley Research Group also found that fast food prices in California have gone up by 14.5% since a year ago – about double the national average of 8.2%. And that’s not even getting into the 89% of all restaurants in the state reducing employee hours to offset rising costs, with 87% planning additional cuts over the next year.
That’s where we are a year later.
For those who support AB 1228, they have been hard pressed to find anything positive about it for well over a year. AB 1228, authored by then-Assemblyman Chris Holden (D-Los Angeles), was one of the most contentious bills in 2023. The Holden bill originally tried for a $22 wage for fast food workers, but it was negotiated down, with the $20 amount narrowly passing both houses in the California legislature and being signed by Governor Gavin Newsom.
Before April 1, 2024, thousands of fast food jobs were shed by companies in anticipation for the higher costs, including Pizza Hut who let go 1,200 drivers alone. Lawmakers also knew that there was suddenly going to be a lot of lost jobs, and hastily brought in exemptions for fast food restaurants in airports, stadiums, theme parks and other major public areas.
Nonetheless, job losses quickly mounted after April 1st of last year when the law went online. Not only job losses either – many workers found that they were now working fewer hours or lost a shift as a result. In addition, restaurants automated what they could to avoid the higher wages, including investing in touch screen kiosks over having more traditional cashiers. Some fast food restaurants also closed, as the 25% wage increase from $16 to $20 ruined their thin profit margins.
If only California legislators who voted for it could be forced to pay for the mess they've created.