One year in, California’s fast food wage hike brings higher pay, debatable job numbers
CNN
The results have been mixed after California raised the minimum wage for fast food workers to $20 per hour in 2024. Economists are divided over the effect on employment, while workers earn more but many complain about reduced hours.
Edgar Recinos no longer has to choose between paying rent and buying groceries. As a cook at a Wingstop restaurant in Los Angeles, Recinos got a significant wage bump last year — one of half a million fast food workers taking part in a great labor experiment. California passed the Fast Food Accountability and Standards Recovery (FAST) Act in April of 2024 amid vocal support and fierce opposition. The first-of-its-kind policy increased the starting wage for California fast food workers to $20 per hour, which is higher than the overall state minimum wage. It also established a statewide council that sets wage and safety standards at fast food restaurants with more than 60 locations nationwide, like McDonald’s, Jack in the Box, Burger King and Subway. But one year later, the initial impact is a mixed bag. Economists are divided over the effect on employment. Workers do earn more, but many complain their hours have been cut. Fast food restaurant owners tell CNN they have been trimming employee hours and instituting hiring freezes to offset the cost of higher wages. Recinos, like many, says his regular hours have been cut. When he doesn’t get to fill in to make up the time, he finds himself “in the same situation before the (wage) increase.” As of March, employment at California’s limited-service restaurants fell 3.1% from the year before, according to the St. Louis Federal Reserve using seasonally adjusted data from the Bureau of Labor Statistics. That’s more than 22,600 jobs lost at fast food restaurants that both did and did not fall under the policy.
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