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Cooking up higher fast-food wages
Raising the minimum wage comes cheap.
Kieran Ryan
January 13, 2025
TODAY’S STORY
Last month, 625 local restaurant owners urged California’s Fast Food Council not to hike the minimum wage for fast-food workers from $20 to $20.70 – stating “[they] simply cannot survive another wage increase.”
But, they can.
While restaurant owners have warned they’ll be forced to fire workers, studies overwhelmingly indicate that, in the end, California’s fast-food workers will be better off. A study of 172 minimum-wage increases from 1979 to 2019 found little evidence of jobs lost despite apparent increases in overall pay.
Instead of firing workers, fast-food chains typically respond by increasing prices, which many have already done. This is actually pretty cheap—increasing employee wages by 10% has been shown to result in a 0.4% increase in menu prices at most.
Unfortunately, some restaurants have had to close since the $20 California fast-food minimum wage went into effect. However, these restaurants were often already underperforming before the wage hikes.
Despite the sheepish cries for help from fast-food chains, the minimum wage increases look promising by all accounts.
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Kieran & Justin Ryan
