Consequence of $20 minimum wage for fast food workers?

[TSwizzle]

A popular fast food joint exits California;

Rubio’s Coastal Grill, the Carlsbad-based restaurant chain famous for its fish tacos, is shuttering 48 “underperforming” California locations in the latest blow to the state’s fast-food industry. In a statement to KTLA, a Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors. The closures, which were announced on Friday, include 24 Rubio’s locations in the Los Angeles area, 13 in San Diego and 11 in Northern California. In April, California Assembly Bill 1228 took effect, boosting the minimum wage for fast-food workers from $16 to $20 an hour. Many restaurants have responded by raising menu prices and, in some cases, laying off workers.

News

the next line that you didn't quote: Rubio’s did not directly mention the law in its statement. they also filed for bankruptcy protection in 2020 as the pandemic began and they were trying to very rapidly expand.

it also doesn't say they're leaving california. it says they're shuttering 48 underperforming stores and still have 86 locations and a quick search shows those are all in california.

i know it's a complicated situation and there's an urge to simplify it down to just minimum wage so it's easier to argue against.

They cite the rising costs of doing business in California. Although the $20 per hour minimum wage is not explicitly stated, I'd hazard a guess that it plays a part. If you disagree, that's cool.

 

[Jimmy Higgins]

People might not be ready for this, but after doing some extensive research, I found out that fast food prices have been going up for years, not just since 2021! Most interesting is it has been outpacing inflation for quite a while.

 

[Jimmy Higgins]

A popular fast food joint exits California;

Rubio’s Coastal Grill, the Carlsbad-based restaurant chain famous for its fish tacos, is shuttering 48 “underperforming” California locations in the latest blow to the state’s fast-food industry. In a statement to KTLA, a Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors. The closures, which were announced on Friday, include 24 Rubio’s locations in the Los Angeles area, 13 in San Diego and 11 in Northern California. In April, California Assembly Bill 1228 took effect, boosting the minimum wage for fast-food workers from $16 to $20 an hour. Many restaurants have responded by raising menu prices and, in some cases, laying off workers.

News

the next line that you didn't quote: Rubio’s did not directly mention the law in its statement. they also filed for bankruptcy protection in 2020 as the pandemic began and they were trying to very rapidly expand.

it also doesn't say they're leaving california. it says they're shuttering 48 underperforming stores and still have 86 locations and a quick search shows those are all in california.

i know it's a complicated situation and there's an urge to simplify it down to just minimum wage so it's easier to argue against.

Curious if they'll note that Circuit City has left California too. Admittedly I have no idea if that store was in California to begin with.

 

[cycomiko]

A popular fast food joint exits California;

Rubio’s Coastal Grill, the Carlsbad-based restaurant chain famous for its fish tacos, is shuttering 48 “underperforming” California locations in the latest blow to the state’s fast-food industry. In a statement to KTLA, a Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors. The closures, which were announced on Friday, include 24 Rubio’s locations in the Los Angeles area, 13 in San Diego and 11 in Northern California. In April, California Assembly Bill 1228 took effect, boosting the minimum wage for fast-food workers from $16 to $20 an hour. Many restaurants have responded by raising menu prices and, in some cases, laying off workers.

News

the next line that you didn't quote: Rubio’s did not directly mention the law in its statement. they also filed for bankruptcy protection in 2020 as the pandemic began and they were trying to very rapidly expand.

it also doesn't say they're leaving california. it says they're shuttering 48 underperforming stores and still have 86 locations and a quick search shows those are all in california.

i know it's a complicated situation and there's an urge to simplify it down to just minimum wage so it's easier to argue against.

They cite the rising costs of doing business in California. Although the $20 per hour minimum wage is not explicitly stated, I'd hazard a guess that it plays a part. If you disagree, that's cool.

of course it will play a part and so will supply chain issues and higher rents and trying to expand too quick and so on. they still have 86 locations in california so i bet the MW is one of the lesser factors in this case.

 

[cycomiko]

A popular fast food joint exits California;

Rubio’s Coastal Grill, the Carlsbad-based restaurant chain famous for its fish tacos, is shuttering 48 “underperforming” California locations in the latest blow to the state’s fast-food industry. In a statement to KTLA, a Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors. The closures, which were announced on Friday, include 24 Rubio’s locations in the Los Angeles area, 13 in San Diego and 11 in Northern California. In April, California Assembly Bill 1228 took effect, boosting the minimum wage for fast-food workers from $16 to $20 an hour. Many restaurants have responded by raising menu prices and, in some cases, laying off workers.

News

the next line that you didn't quote: Rubio’s did not directly mention the law in its statement. they also filed for bankruptcy protection in 2020 as the pandemic began and they were trying to very rapidly expand.

it also doesn't say they're leaving california. it says they're shuttering 48 underperforming stores and still have 86 locations and a quick search shows those are all in california.

i know it's a complicated situation and there's an urge to simplify it down to just minimum wage so it's easier to argue against.

Curious if they'll note that Circuit City has left California too. Admittedly I have no idea if that store was in California to begin with.

wait til you hear about the toll the MW increase has taken on the Blockbusters and Hollywood Videos.

 

[BH]

There are some businesses that the 20 hr will definitely hurt and put out of business. But I know in my area fast food places that paid minimal wage before covid ended up having to up their pay to ten, fifteen, or twenty an hour to get help. They did this without government law forcing them to. No fast-food restaurants went out of business locally and I know many of the managers who are also friends. The part time to full time ratios didn't change much. I suspect the owners had the money to pay much more all along and just wouldn't until they had to. Now that the cat is out of the bag no one will go back and work for lower wages.

 

[robnisch]

When I was in food service, years ago, labor was about 25% of cost. So from $16 to $20 increase would be what % increase in cost?
Food service is a really tough business. Supply chain issues like the price of (pizza)cheese was a bigger problem. Maybe there is too much fast food.

 

[Don2 (Don1 Revised)]

When I was in food service, years ago, labor was about 25% of cost.

I did some back-of-napkin calculations in post#63.

The short answer is Yes, but note that labor costs are not all wages. There are other benefits included in labor, social security, health care, etc...

Estimates range from 17% to 20% for wages. In post#63, I used the higher so I conservatively computed an overestimate, at least to start.

Next, note that not all employees would be making minimum wage as you have managers of various stripes and veteran employees and so the average increase wouldn't be from old minimum wage to new minimum wage. I conservatively assumed all employees were making minimum wage.

So from $16 to $20 increase would be what % increase in cost?

I estimated 6% in post#63. Here is a link to that post:

Consequence of $20 minimum wage for fast food workers?

And the US has been using machine sorting for decades too. not according to google Link?

iidb.org

Later on in the discussion, I referenced experts who had it only at 4% because presumably they did not use the conservative overestimates that I did. Here is a link to that:

Consequence of $20 minimum wage for fast food workers?

California Increases Minimum Wage, Protections for Fast-Food Workers I never understood why fast food workers should have a higher minimum wage than other industries, or why burger flipping and cashiering should get you $20/hour anyway. In any case, forcing companies to overpay fast food...

iidb.org

Food service is a really tough business. Supply chain issues like the price of (pizza)cheese was a bigger problem. Maybe there is too much fast food.

Yes, yes, and yes.

 

[TV and credit cards]

A popular fast food joint exits California;

Rubio’s Coastal Grill, the Carlsbad-based restaurant chain famous for its fish tacos, is shuttering 48 “underperforming” California locations in the latest blow to the state’s fast-food industry. In a statement to KTLA, a Rubio’s spokesperson cited the “rising cost of doing business” and the “current business climate” in California as key factors. The closures, which were announced on Friday, include 24 Rubio’s locations in the Los Angeles area, 13 in San Diego and 11 in Northern California. In April, California Assembly Bill 1228 took effect, boosting the minimum wage for fast-food workers from $16 to $20 an hour. Many restaurants have responded by raising menu prices and, in some cases, laying off workers.

News

Whatever will become of the employees? Destitute and wandering the streets, searching for work stuffing breaded fish in tortillas. Eventually landing in California's parks and on her beaches with a needle in their arm.
Gavin Newsom and the Damage Done.

 

[Don2 (Don1 Revised)]

McDonald's Is Considering Leaving California Due to State's Minimum Wage Increase?

An online article claimed, "McDonald's is reportedly considering a drastic measure – exiting the California market altogether."

www.snopes.com

I wonder who paid for that fake news.

The fast-food industry claims the California minimum wage law is costing jobs. Its numbers are fake

Fast-food lobbyists say the higher California minimum wage law led to a loss of nearly 10,000 jobs. The claim is baseless.

www.yahoo.com

Also, who is paying the business lobbyist for his fake news?

 

[TV and credit cards]

States where minimum wage will rise in 2025

Nearly half the states in the U.S. are raising their minimum wages in 2025, meaning pay hikes for more than 9 million workers, according to a new report.

www.foxbusiness.com

Don't forget the comments section.

So how's the sky holding up? Are there tears on your Big Mac? Is the girl at the drive-thru window wearing Gucci now?
$16.50 in California. OMmotherfuckingG!

Blog post >> Visit the Paycom blog to learn more

Ensure you’re up to date on 2025’s hourly minimum wage requirements in the states where you operate.

www.paycom.com

 

[Politesse]

I can report that we still have fast food in California.
Current price for a Big Mac in my area: $7.99
A Charburger with cheese at the Habit is $8.99
A B'igi Americano at Iniburger is $13.19

Workers are generally pretty surly.

Customers haven't stopped coming.

In general, the fast food sector is booming in California. There are more jobs than there ever were, they pay more than they ever have, and the restaurants are turning huge profits. Hours have not been reduced. There has been no mass reduction of stores by previously healthy chains. Many of the "think tanks" that reported on the doom of the California burger eventually had to shamefacedely retract their own false reporting.

The burgers still suck of course, but they suck less bad here than in most places, as we at least have a few interesting and unique chains with higher quality offerings than most places in the country.

Conservatives will glibly ignore all of this, and continue to insist for years to come,, against all evidence, that when California raised its minimum wage, it almost collapsed the state economy. If they were ashamed of propogating lies, they wouldn't be conservatives in the first place.

 

[Bullmoose Too]

People are not things to be used at the cheapest possible rate in order to increase profits and maintain multi million salaries for those at the top..

That reads like something a socialist would write.

 

[steve_bank]

I'd say the issue is that fast food and other service jobs were never intended to provide a living wage. These days the traditional living wage jobs for those without skills and education are not as plentiful as they once were.

Here in Seattle Starbucks workers who just serve coffee all day are unionizing and demanding a living wage and benefits.

The area consequence of higher min wage for all jobs is small businesses and restaurants are closing or raising prices. Higher prices mean less customers and revenue.

A few years ago our city council passed an ordnance requiring surcharges on independent driver ride services. Drivers complained that with idle time their average hourly pay rate was low.

Cost was passed on to customers. Food delivery requests dropped and driver revenue went down. Drivers again complained.

 

[laughing dog]

I'd say the issue is that fast food and other service jobs were never intended to provide a living wage….

No job is intended to provide anything but compensation to the worker. Moreover, whatever was “intended” over 50 years ago in the marketplace is moot in a current.dynamic economy. So your analysis rests on a false premise.

 

[Politesse]

Here in Seattle Starbucks workers who just serve coffee all day are unionizing and demanding a living wage and benefits.

Those assholes. How dare workers expect to paid for their work.

 

[TV and credit cards]

I'd say the issue is that fast food and other service jobs were never intended to provide a living wage. These days the traditional living wage jobs for those without skills and education are not as plentiful as they once were.

These days jobs not requiring skills or education are service sector jobs. Fifty years ago it was manufacturing jobs. What difference does it make if the unskilled worker is mindlessly toiling away making a thousand automotive fasteners a day or a thousand cheeseburgers? The unskilled of yesteryear got a living wage, why not now?

 

[DBT]

People are not things to be used at the cheapest possible rate in order to increase profits and maintain multi million salaries for those at the top..

That reads like something a socialist would write.

Just an observation of how business works. The evidence of that can be seen in the salaries of upper management and the profits of big corporations.

 

[Jimmy Higgins]

I'd say the issue is that fast food and other service jobs were never intended to provide a living wage. These days the traditional living wage jobs for those without skills and education are not as plentiful as they once were.

Here in Seattle Starbucks workers who just serve coffee all day are unionizing and demanding a living wage and benefits.

The area consequence of higher min wage for all jobs is small businesses and restaurants are closing or raising prices. Higher prices mean less customers and revenue.

A few years ago our city council passed an ordnance requiring surcharges on independent driver ride services. Drivers complained that with idle time their average hourly pay rate was low.

Cost was passed on to customers. Food delivery requests dropped and driver revenue went down. Drivers again complained.

Well, the career factory jobs leftthe continent.

 

[steve_bank]

Here in Seattle Starbucks workers who just serve coffee all day are unionizing and demanding a living wage and benefits.

Those assholes. How dare workers expect to paid for their work.

The economy such as it is works general by the principle of supply and demand. That includes both material and labor. As labor supply goes up in an area wages offered go down. It happens in engineering and other professional employment not just fast food.

I think it was back in the 90s when fast food had trouble findng workers, wages went up well above min wage.

I know from my work everything in the economy is connected. Your statement 'assholes' is simplistic at best.

Business owners are not isolated in what they do, along with labor they are subject to supply and demand for goods and services they sell.

That increasing numbers at the bottom are yhaving trouble making ends meet is a systemic problem.

As I posted in Seattle restaurants are closing or moving away because they can't pay the min wage and survive. These business owners are not rich exploitive barons of industry, they make a modest living through their businesses.

Painting all business owners as onerous giants like Amazon is also simplistic. A major source of employment is small to medium size companies.

Amazon is exploitive on labor, there is no debate. It has been known for some time many of its full time employees rely on government assistance when Amazon can well afford to pay higher wages.

You once told me I should 'read books'. May I suggest you read an econ 101 text and sit in on a few econ classes where you teach.