The battle over the minimum wage in the fast food sector has been raging in California all year. Here is a brief summary:

After Governor Gavin Newsom signed AB 1228 into law in October 2023, the new $20 minimum wage for fast-food workers – a massive jump from the previous minimum wage of $16 – forced many businesses to take extreme measures. Some, like Chipotle and McDonalds, announced increased prices ahead of the April 1 effective wage increase date. Others invested in automated kiosks and other automated equipment to reduce employee numbers. Some businesses even had to close entirely.

What was most striking, however, was the massive number of layoffs. Layoffs of over 1,200 Pizza Hut drivers were announced in advance, to be replaced by services like DoorDash and Uber Eats in the coming months. Roundtable Pizza did the same with many of its delivery drivers, and many other chains have also quietly done the same for their deliveries in the months that followed, as can be seen in the proliferation of fast-food companies on food delivery websites.

Because the economic impact was already being felt before the law was even in effect, lawmakers scrambled to limit the damage. The author of the bill, AB 1228, Assemblyman Chris Holden (D-Pasadena), has created a new bill that provides numerous exemptions to mitigate the economic fallout of AB 1228, but for fast-food restaurants in airports, stadiums, casinos, events and on corporate campuses. As the Globe noted, AB 610 does anything but clean up the chaos caused by AB 1228. Even though it passed, closures continued to occur, albeit on a quieter scale. In June, that included the mass closure of Rubio’s restaurants across the state.

And when it comes to the total number of jobs lost, the governor’s office has been particularly sensitive. In June, the Globe reported that 10,000 fast-food jobs have been lost so far as a result of AB 1228. Although the information came from Stanford University and was widely verified, the governor’s office attacked it, saying that fast-food jobs had actually been added in California. In the months that followed, the office issued numerous press releases, and Governor Newsom himself said just this week that there had been increases. The Globe and numerous other media outlets have proven time and time again that there simply aren’t any increases, and that there have been many lost fast-food jobs in the state. And it’s getting worse, as fast-food workers’ unions are already trying to push through another raise, to $20.70 an hour.

On Thursday, the Globe spoke to many fast-food managers and franchise owners about what’s going on at the grassroots level. And the result? More losses than profits.

“Yeah, since the minimum wage came into effect, I’ve had to lay off a lot of people,” replied Diego, who runs a fast-food hamburger restaurant chain in San Bernardino County. “It’s sad. Just down the street was the first McDonald’s, you know? But the minimum wage was too much. We’ve achieved a more balanced ratio now. Even during busier times, there’s only one person at the register, and a lot of the kitchen duties have been distributed to others. If we didn’t have to take cash, I’d honestly just leave the ordering to the touchscreen out there.”

Theresa, a franchisee of two Mexican fast-food restaurants in San Diego, told the Globe something different.

Losses in the fast food sector in California

“Oh, we’ve lost people, but that’s not reported as job losses in the true sense. We have people quitting or taking other jobs, then we just don’t hire and get by. Only when we have a shift situation with not enough people do we hire. We were lucky because we had to hire several people in early June when schools were out.

“However, the minimum wage is on us. I was reading the Globe earlier and you had an article about 74% of the fast-food restaurants in the state considering closing because of it? I totally believe that, because I believe it.

“I’m actually waiting for more places to close, and when we start getting around this minimum wage thing, most likely through more automation, we’ll expand. A lot of empty restaurants will be available and we can get them cheap. A lot of other places will do that too. But we don’t need such a high minimum wage.”

The layoffs were also difficult.

“I mean, who are you laying off?” MacKenzie, manager of a franchise pizzeria in San Mateo County, asked the Globe. “We have teenagers who are working and want to get their first job. Generation Alpha really wants to work, and if we don’t let them do that, man, it hurts. Or are you laying off the 20- and 30-year-olds who are working their second or third job to make ends meet? We have single mothers, too. Then you have older workers who are between jobs and needing to bridge the gap. And then you have seniors who don’t have enough to retire and they need that job.

“This has been my dilemma since the beginning of the year. Nobody wants to lose their job, but these wages are getting us closer and closer to the point where we’re losing money. We’re at that limit. I ended up having to lay off the teenagers. Not because they were bad workers, but because everyone else was working just as hard and seemed to need the money more. And it killed me to do that. And it looks like I’m going to have to lay off a few more. The state is basically forcing us to choose whose lives we want to ruin.

“These are all good people. Parents, grandparents, single people. We have people working toward citizenship. Others are excited about their first job. One girl we hired as a driver actually showed her on TikTok wearing her company shirt and hat, she was that happy with her first job. And then I had to fire her earlier this year because we just weren’t doing well. All because of the minimum wage law.

“The governor can say what he wants, but if the people have to make the decisions, that’s bad.”

Further information on the minimum wage in the fast food sector will follow shortly.