Don’t be surprised the next time you visit your favorite fast food restaurant and find that the prices on the menu have gone up – if they haven’t already.
In April, California law raised the minimum wage for fast-food workers to $20 an hour, a state where they are “more than twice as likely to live in poverty as other workers,” the Service Employees International Union said. The union has been instrumental in the fight for higher wages for fast-food workers, according to Cal Matters.
At the same time, restaurant industry executives have expressed concern that the law could lead to job cuts and price increases, USA TODAY reported.
A recent survey by the Employment Policies Institute, a nonprofit research organization, assessed the impact of rising wages at fast-food restaurants and found that these concerns are now a reality for some restaurants.
The nonprofit’s online survey of 182 limited-service restaurants (fast food or quick service) found that higher menu prices were just one significant effect of the minimum wage increase.
Here’s what some California fast food restaurants are doing in response to the $20-an-hour rate and what customers can expect, according to the survey.
Do fast food restaurants charge me more?
The Employment Policies Institute, which conducted the survey in June and July, found that 98% of respondents had already raised menu prices because of the $20 minimum wage.
This comes as prices at fast food restaurants have increased 47% over the past decade, USA TODAY reported, although many chains, including McDonald’s, Taco Bell and most recently Jimmy John’s, have introduced various discounted meal deals this summer.
How else does California’s minimum wage for fast food workers affect restaurants?
Drive-thru customers aren’t the only ones affected. The same people who see their wages increase may also see their hours decrease.
The survey found that 89% of respondents had reduced their employees’ working hours. In addition:
- 73% of respondents had limited opportunities to work shifts or overtime
- 70% reduced staff or consolidated positions
The survey also asked respondents to share how the new minimum wage law would affect their restaurants over the next year, and 60% said it would increase automation or self-service technology.
What is the California state minimum wage in 2024?
The minimum wage in California is $16 per hour, although some cities have a higher minimum wage.
What is the federal minimum wage?
The federal minimum wage is $7.25 per hour.
Paris Barraza is a California news reporter for The Desert Sun. You can reach her at pbarraza@gannett.com. Follow her on Twitter @ParisBarraza.
