A new California law, pushed by Governor Gavin Newsom (D), raised hourly wages for fast-food workers from $16 to $20. The law goes into effect on April 1, 2024. It didn’t take long for fast-food restaurants in the state to feel the impact on their bottom lines, with many forced to lay off staff, cut hours, and raise prices to make up for the state’s new wage requirements.
The Chen family owns seven Wendy’s restaurants in Southern California, and to make up for the forced wage increases, they have had to cut their workforce by nearly half, cut hours for those who remain, and raise prices by 8 percent to stay in business.
Wendy’s is not the only chain affected by the new regulations. Rubio’s California Grill reportedly closed dozens of locations across the state. Jersey Mike’s had to cut part-time staff. Other chains, including McDonald’s and In-N-Out, were forced to raise their menu prices. Hollywood’s iconic Arby’s had to close after 55 years in business. They couldn’t weather rising food costs, inflation, and new minimum wage laws. Many fast food workers in California now earn $0 instead of $20 an hour and must find new jobs in an already tough market, the exact opposite of the intended outcome of the new law.
“When labor costs jump by more than 25 percent overnight, the already thin-margin restaurant industry will be forced to cut other expenses,” Giotto Condie, president and CEO of the California Restaurant Association, told The Associated Press.
California restaurant workers aren’t the first to see the negative effects of a minimum wage increase.I lost my job because of the minimum wage.On the show, host Simone Baron recalls that she quickly regretted supporting a minimum wage increase. Baron considered herself a “fair-minded progressive” who supported the Seattle City Council when it raised the minimum wage from $9.47 to $15 an hour in 2015. As a result, the restaurant where she worked closed for good. Baron was quickly able to interview at another restaurant, but that one closed before she could interview.
A few years ago, New York City’s minimum wage increase caused the industry to crash, with 75% of employers cutting employee hours and 47% cutting jobs. Years later, it’s unfortunate that Sacramento didn’t learn from New York’s mistakes.
While many “justice progressives” like Simone Baron may believe that raising the minimum wage is a good thing for workers and society as a whole, the reality is quite different: its negative effects often outweigh the potential benefits.
This would seem like common sense: when business expenses rise, for example through increased wages, companies must cover those costs, often by raising prices for consumers. These are basic economic principles that every young American should learn in high school. Unfortunately, they are not. America’s education system is inadequate, prioritizing DEI (diversity, equity, and inclusion) initiatives, radical gender ideology, apocalyptic climate narratives, historical revisionism, and anti-Americanism over practical life skills, financial literacy, and foundational subjects like history, math, and civics.
As a result, many Americans lack a fundamental understanding of economics, one of the most important yet misunderstood subjects in the world today. PragerU understands that our education system is failing Americans, and they are committed to doing the work that schools and colleges have neglected. That’s why they launched. PragerU Economics 101—Free videos and educational resources that teach basic economic principles to Americans in desperate need of a quality education. Designed for anyone who wants to learn the ins and outs of economics without reading a 1,000-page textbook or wading through a never-ending sea of misinformation online.
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of Economics Introduction Video It focuses on a variety of topics including capitalism, socialism, free markets, minimum wage, inflation, taxes, etc. Presenters include David Bahnsen, one of America’s top financial advisors. Barons, Forbesand the Financial TimesSteve Forbes, chairman and editor-in-chief of Forbes Media, best-selling author and two-time Republican presidential candidate; FreedomWorks; The Wall Street Journal, The Washington Times, National ReviewThe Heritage Foundation, CNN, the list goes on and on.
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People need to wake up to the reality of disastrous left-wing economic policies like raising the minimum wage, increasing taxes, expanding the size of government, and regulating corporations. A biased media and education system have failed Americans. We have created a nation of economically ignorant people. PragerU is taking action against it.
