Arlington, VA – Today, the Employment Policies Institute (EPI) released new data showing AB 1228, California’s $20 wage law for fast food workers, cost non-tipped restaurant workers 250 hours of work annually, equating to up to 7 weeks of lost work. The loss represents up to $4,000 in lost potential income under the regular state minimum wage ($16 an hour) fast food workers were subject to prior to the $20 wage hike.
The EPI data uses Current Population Survey Outgoing Rotation Group (CPS-ORG) survey data on usual weekly hours worked by non-tipped restaurant workers, and compared the mean and median hours worked prior to the passage of AB 1228 (Jan. 2022-Aug. 2023) and after the implementation of the law (Apr. 2024 – Present). While the exact universe of affected restaurant workers is not identifiable in federal data, EPI’s analysis represents a likely conservative estimate of directly and indirectly affected workers.
“Governor Newsom’s ‘modest’ law took a sledgehammer to the fast food industry,” said Rebekah Paxton, research director at the Employment Policies Institute. “Tens of thousands of workers have lost their jobs, and now new data shows that even those who have kept their jobs have lost nearly two months worth of potential work hours from their schedules. This is unsustainable. Workers deserve better than empty pockets and broken promises.”
Read the full breakdown of the data at the link here.
Background:
- According to the latest available quarterly data from the Bureau of Labor Statistics representing 95% of employers, California has lost as many as 16,000 jobs since the state’s $20 fast food minimum wage law was signed in September 2023. (The state is down nearly 14,000 jobs since the law officially took effect in April 2024);
- The state has seen the worst fast food job growth rate since the Great Recession;
- A study by the Berkeley Research Group found that menu prices have increased 14.5% due to the $20 wage hike;
- After the implementation of the $20 minimum wage law, an EPI survey found that a majority of restaurants say they had raised menu prices (98%), reduced employee hours (89%), limited employee shift pick-up or overtime opportunities (73%) and reduced staff or consolidated positions (70%) as a result of the minimum wage law;
- Additionally, a majority of restaurants surveyed said in 2025 they will have to raise menu prices (93%), reduce employee hours (87%), reduce staff or consolidate positions (74%), and limit employee shift pick-up or overtime opportunities (71%).