California
Will $20 minimum wage crush fast food in California?
California is on the cusp of putting the fast-food industry into a curious economic experiment – mandating a custom minimum wage for larger restaurant chains.
Come April, fast food’s biggest players will be paying workers $20 hourly vs. 2024’s statewide $16 wage floor. The thinking behind the legislation is that the industry’s workers have long been underpaid, and a bold move was required to get these poorly compensated workers some hope of surviving California’s high cost of living.
Economic history tells me that this labor-intensive industry, despite all of its protests about the government’s hand in the cost of doing business, has managed to thrive.
Fast food lives in a consumer sweet spot: demand, convenience and relative affordability. And this pay hike – equal to minimum wage increases during the past five years – will create grand economic unknowns.
Will jobs be cut? Restaurants closed? Automation expanded? Will prices skyrocket? A mix of these? Or none of the above? Already we’ve seen Pizza Hut franchisees say they’ll cut 2,000 drivers statewide due to the wage hikes.
But you cannot ignore the other side of this equation. As a workplace, fast food is a tough gig.
It’s typically part-time employment with challenging schedules and few, if any, benefits. This slice of food service workers is paid some of the state’s lowest wages. California food workers, by one federal calculation, earn $18 an hour on average vs. $35 for all workers statewide.
To understand this dichotomy, I filled my trusty spreadsheet with several employment and price stats for fast food – employment at limited-services restaurants; a California slice of the Consumer Price Index for dining out, and the minimum wage’s history.
What you see is that fast food is a significant, quick-growth industry. Limited-service restaurants employed 744,000 Californians in 2023 – that’s 4% of the state’s 18 million jobs.
And fast food’s addition of 431,000 workers since 1990 is nearly 8% of all California job growth. These worker additions are on par with the expansion of jobs in transportation and warehousing or local government.
Or look at it this way: Fast food’s 138% hiring spree since 1990 is triple the 44% job growth seen for all industries statewide.
That expansion happened as California’s minimum wage ballooned from $3.35 in 1990 to $15.50 last year. That’s a 363% jump in pay for the bottom-tier worker – nearly a fivefold pop. And it’s more than double the 167% jump in overall inflation.
And over the 33 years, dining-out costs for all kinds of eateries inflated only slightly more than the CPI – up 182%.
But look at fast food’s ebbs and flows over this third of a century, as I slice economic history into three chapters. Fast food’s quickest growth has come as wages and dining out costs jump the most.
1990-2000: $1 burger wars
This era featured big national chains battling for market share with a host of marketing ploys — from cheap food to big promotions for kids’ meals.
California fast food staffing grew by 107,000 or 34% growth, which doubled the statewide 16% hiring expansion. Fast food equaled 5% of the 2 million hires statewide.
This was a period where the minimum wage jumped 72% to $5.75 from $3.35. That was nearly double the 38% overall inflation rate.
But dining-out prices rose only 29% – likely due to the significant marketing battles of that era. Do you remember the $1 burgers and cheap taco promotions?
2001-2012: Double dips
Two recessions – one of legendary scope – cooled fast food and iced the rest of the California economy.
Still, the state’s fast food industry added only 79,000 jobs in this period or 19% growth. At the same time, however, all other bosses in total cut 37,500 California workers. Remember, the dot-com crash and the Great Recession throttled employers’ willingness to add staff in most industries.
In these economically uncertain times, the state’s minimum wage rose only 39% to $8 from $5.75. The bump was on par with the overall inflation rate.
Yet dining-out prices rose faster, a 43% increase, as busy consumers grew fonder of eating away from home.
2013-2023: The boom
Quick-serve eateries have flourished. Smaller chains brought new flavors and excitement to the industry as pandemic-era twists helped popularize take-out and delivery dining.
Fast food added 236,700 jobs or 47% growth – that’s 7% of all hires and double the statewide 22% hiring pace.
In this period, the minimum wage nearly doubled (to $15.50 from $8) vs. 39% overall inflation – most of that hike coming in the past two years.
Please note that dining-out prices jumped 53%, easily exceeding broader inflation.
Bottom line
Ponder fast food’s pricier competition, full-service dining.
From 1990 through 2015, staffing at these two styles of eating out moved essentially in tandem.
Eight years ago, when the state minimum wage was $9, full-service had 626,000 California workers – up 297,000 since 1990. Fast food staffing was 605,000 – up 292,000 in 25 years.
Fast-forward to 2023. Full-service added just 2,000 positions statewide in eight years. Fast food grew by 139,000.
This growth gap can be tied to everything from changing consumer demands to pandemic business restrictions to fast food’s price advantage.
But far costlier quick-serve meals seem to be a likely outcome of the coming higher minimum wage. Will that ultimately slow fast food’s growth, too?
Jonathan Lansner is business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
California
Teen dies after losing control of electric motorcycle in Garden Grove
A 13-year-old boy riding an electric motorcycle in Garden Grove died after veering into the center median, flying into the air and then slamming onto the roadway, authorities said.
The crash took place shortly before 10 p.m. Thursday in the area of Magnolia Street and Larson Avenue, according to the Garden Grove Police Department. The Police Department received word of the incident via a call from Life360, a family safety and location-sharing app with emergency assistance features.
The Santa Ana teen was critically wounded in the crash, police said. He was loaded into an ambulance and taken to a hospital, where he was later pronounced dead.
The boy was traveling at around 35 mph on a black E Ride Pro electric motorcycle when he struck the median and lost control of the vehicle, according to authorities. Electric motorcycles are primarily designed for off-road riding and are not legal to use on California roadways.
The teen’s death is the latest in a spate of serious collisions involving electric motorcycles and dirt bikes — some of which have led to serious injuries, death or charges for parents who allegedly allowed their minors to illegally ride the speedy devices.
An Orange County mother was charged with involuntary manslaughter last week after authorities said an 81-year-old Vietnam veteran died from injuries he suffered when her 14-year-old son slammed into him while riding an e-motorcycle, then fled the scene.
In April, a Yorba Linda father was charged with felony child endangerment after authorities alleged his son ran a red light and was hit by a car while riding a modified e-motorcycle capable of reaching up to 60 mph.
Last week, a 19-year-old riding an e-motorcycle was arrested on suspicion of felony evading police and felony reckless driving. He was accused of leading sheriff’s deputies on a speedy chase through a residential area of Oceanside, blowing past multiple red lights and knocking a deputy off a motorcycle.
Electric bikes, motorcycles and dirt bikes have surged in popularity in recent years and are especially popular among teens. However, while e-bikes generally top out at 28 mph and are legal to ride on the street, many e-motorcycles can go twice as fast and are generally not street legal.
Anyone who witnessed Thursday’s crash in Garden Grove or has a video of the incident is asked to contact Investigator Lang via phone at (714) 741-5823 or email at mlang@ggcity.org.
California
California to give newborns free diapers. What it means for families
Top moments from CNN California governor debate recap
Breaking down key takeaways, highlights, and analysis from the CNN California governor debate, including standout moments and candidate contrasts.
Gov. Gavin Newsom announced that newborn babies in California will start receiving free diapers as part of a new “first-in-the-nation” initiative to support families across the state with the rising cost of living.
Newsom, along with state leaders, met in San Francisco on Friday, May 8 to unveil California’s new partnership with Baby2Baby, a national nonprofit that provides diapers to children in need, and to explain how this new program will provide families with 400 “high-quality” diapers before they leave the hospital.
Over the last six years, families have seen the average cost of diapers increase by 45% or “thousands plus dollars a year,” which has made raising a family unattainable for some, Newsom said during the press conference.
“Every baby born in California deserves a healthy start in life — and that means making sure parents have the basics they need from day one,” Newsom said. “One out of four families skip meals in order to pay for diapers.”
“The biggest problem defined universally, in our cities, our state and our nation, is the issue of affordability. This is what affordability looks like; it’s not a slogan, it’s a box. A box of diapers,” Newsom added.
This new effort will be known as Golden State Start, as California uses its bulk purchasing power to obtain 40 million high-quality diapers in hopes of easing financial strain for families and supporting infant health by helping parents maintain an adequate supply of clean diapers.
“The first days at home with a newborn should be focused on the love, connection, and joy of an expanded family, not stress about affording diapers,” said Kim Johnson, secretary of the California Health and Human Services Agency. “This program helps ensure families can begin that journey with greater stability and peace of mind.”
The program is expected to start at the beginning of this summer in participating California hospitals. The list of participating hospitals was not released at the time of publication, but Newsom noted that the state was in talks with at least 60 hospitals across California.
During the first year of the program, CalRx and Baby2Baby noted that they would prioritize hospitals that serve large numbers of Medi-Cal patients to ensure low-income families benefit early from the program. The state plans to scale the program to additional hospitals and birthing centers over time.
Newsom noted that this program is expected to grow: In 2027, the state is set to purchase 80 million diapers from manufacturers, with the goal of eventually purchasing up to 160 million.
“California families deserve to feel supported during one of life’s more exciting, yet vulnerable transitions,” Jennifer Siebel Newsom, the first partner, said in a press release. “Golden State Start will deliver immediate relief, allowing parents to focus on what matters most — caring for their newborn. Together with Baby2Baby, we can ease the financial burden on California parents while supporting healthier outcomes for babies and their mothers.”
Noe Padilla is a Northern California Reporter for USA Today. Contact him at npadilla@usatodayco.com, follow him on X @1NoePadilla or on Bluesky @noepadilla.bsky.social. Sign up for the TODAY Californian newsletter or follow us on Facebook at TODAY Californian.
California
Nordstrom Rack expands in Southern California with new stores
Nordstrom Rack will open two new Southern California stores next year.
The discount outlet said on Wednesday that it will open new stores in Marina del Rey in the spring of next year and in Torrance later that summer. The locations join 69 Nordstrom Rack locations already operating in the state.
“We’re excited to grow our footprint in the Los Angeles market and introduce new customers to the Nordstrom experience,” Gemma Lionello, president of Nordstrom Rack, said in a news release.
Nordstrom Rack is an outlet version of the upscale retailer Nordstrom, offering merchandise from top brands at a discount.
Bargain retailers have expanded in California recently, benefiting from increasingly cost-conscious customers, who are motivated to spend less by economic anxiety and inflation.
Discount outlets such as Ross, T.J. Maxx and Dollar General have capitalized on the tough economic times and experienced accelerated growth. Ross reported record sales in 2025, up 8% from the year prior.
Bargain retail stores have acquired a larger supply of discounted products by buying unsold merchandise from struggling high-end stores. Customers who feel destabilized financially by tariffs and global conflict have used the stores to try to find lower prices.
The new Nordstrom Rack storefronts will be in Marina Marketplace in Marina del Rey and Rolling Hills Plaza in Torrance.
“The Los Angeles retail market continues to see growth from retailers like Nordstrom looking for anchor space in vibrant areas,” Scott Burns, senior managing director for the company that manages Marina Marketplace, said in a news release.
The bargain outlet boom comes as department stores and malls struggle. Nordstrom, the upscale retailer, closed a Santa Monica location in July. Macy’s shuttered two California locations this year and will reduce its footprint by 30% in 2027.
Shopping malls across Southern California have also struggled to bring sales back as immigration raids continue to scare customers away.
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