California’s minimum wage for fast-food workers at businesses with more than 60 locations increased to $20 an hour in April, sparking concerns that the industry would suffer due to increased payroll costs. However, recent data from the U.S. Bureau of Labor Statistics shows a rise in employment for limited-service restaurants in California, with 745,600 people employed in May, up from 742,600 the previous year and 739,500 in April.
This sector includes restaurants, pizzerias, delis, and other restaurant types not included in the mandated minimum wage increase. Since January, this industry sector has added 20,700 jobs. A representative from the chicken restaurant Raising Cane’s Chicken Fingers reported a positive impact from the wage increase, stating that they have seen an almost 10% improvement in turnover and a positive impact on retention rates.
Despite these positive reports, some restaurants have responded to the increase by raising menu prices or declaring bankruptcy. For instance, In-N-Out increased menu prices, and San Diego-based Rubio’s Coastal Grill declared bankruptcy in June, citing the rising cost of doing business in California as a factor.
