Who could have predicted that California’s massive minimum wage hike would have “negative consequences?” Well, RedState certainly did, along with everyone else who wasn’t a hard-left progressive.
The law, which mandated a $20 per hour minimum wage for fast food workers at franchises that have more than 60 locations in the Golden State, went into effect in April 2024. But wait, there’s more! The law created the Fast Food Council — and gave it the green light to impose further wage increases yearly until 2029, when the council’s authority runs out.
What are the effects of the law, AB 1228? UC Santa Cruz Economics Lecturer Stephen Owen decided to find out, and surprise, surprise:
“Based on what we’ve found, I think this legislation is a classic case of ‘no good deed goes unpunished,’” Owen said. “There are unintended consequences and knock-on effects, and overall, I think the results have definitely not been as positive as policymakers had been expecting.”
Note that UC Santa Cruz isn’t exactly known as a bastion of conservatism, so the situation must be bad if the report is emanating from there.
Another Newsom Policy that’s failed California.
— Heatherheather007 (@LibertyValkyrie) April 4, 2026
“…the results have definitely not been as positive as policymakers had been expecting.” —Stephen Owen, UC Santa Cruz Professor who conducted the effects on $20hr+ minimum wages for fast food workers
It’s caused a loss of jobs,… pic.twitter.com/TFxPzTeIn9
It’s caused a loss of jobs, as owners have moved to automate more tasks, requiring a smaller work force, and less hours.
It’s raised prices on menu’s for consumers, while providing less customer service.
Newsom’s team refutes the study, claiming, “…it’s not peer reviewed, and its claims are flat-out wrong.” They continue that higher wages boost the economy, and bring people out of poverty, ignoring the claims stating otherwise.
SHOCKED NOT SCHOCKED: Like AB5, CA's Fast-Food Minimum Wage Hike Results in Layoffs, Closures, and Higher Prices
What’s the outcome so far? Well, just what you’d predict: more automation and job losses.
“The results indicate a plethora of negative outcomes such as higher menu prices for consumers, reductions in employee working hours, widespread elimination of overtime and loss of benefits for employees,” Owen and his team noted. “Further decreases in employee opportunities are being driven by automation and the adoption of labor replacement technologies is accelerating.”
In other words, the obvious consequences of artificially boosting worker pay beyond market rates came to pass.
The higher labor costs led to “sector specific minimum wage with investments in new technology and automation.”
Computers don’t call in sick, and companies don’t pay them by the hour. As the cost of labor increases, automation makes more financial sense.
It’s hard to quantify exactly how many jobs have been lost directly due to 1228, but many estimates put the number in the tens of thousands:
36,565 fast food jobs have been lost in California since AB 1228 was signed into law in September 2023.
The $20 per hour minimum wage went into effect on April 1, 2024.
Between September 2023 and April 2024, over 10,000 jobs were cut ahead of implementation.
Restaurants have rapidly moved to automation, digital kiosks, and reduced hours to offset labor costs.
Fast food prices in California have jumped 14.5%, far above the national average of 8.2%.
I used to enjoy a taco or a burger now and then — nowadays, fuhgeddaboudit.
$17.50 for a Burger and Fries?! Get Outta Here! (VIP)
All of this was entirely predictable, but folks like Newsom simply don’t care. Their “progressive” vision has been the antithesis of progress and has severely wounded the state in so, so many ways.
Over time, they’d probably raise the minimum wage to $50 an hour — but by then their may be no more franchises or customers left.
Editor’s Note: Gavin Newsom wants to turn America into one big version of California - a failed, overtaxed, dystopian nightmare.
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