When California’s fast-food restaurants were required to raise wages to $20 an hour, they were alarmed, and there were grim warnings of job cuts and large price hikes for customers. Now, six months after the fast food worker pay bump went into effect, Los Angeles Times columnist Michael Hiltzik wrote about whether these doom and gloom predictions came true. Hiltzik joined host Lisa McRee on “LA Times Today.”
Hiltzik explained that some studies on how the employment of California’s 750,000 fast food workers was impacted after the pay increase.
“The Wall Street Journal said there were 10,000 job losses just between September when the bill was passed in September 2023 and January of 2024. What The Wall Street Journal forgot, or didn’t know, or maybe purposefully didn’t say was that they were using non-seasonally-adjusted job numbers. And you can’t do that if you want to be fair, because jobs in fast food always declined sharply between September and January. It happens every year without fail. And if you don’t compensate for that, then you’re really telling a story that’s not true,” Hiltzik said.
Researchers at UC Berkeley and Harvard University have studies on what the impact of the wage hike has been on employees.
“The answer is from both of them that there’ve been no detectable job losses,” Hiltzik said. “And, in fact, the workers who work at fast-food restaurants, they’re your counter people and your cooks in the back. They’re doing much better because they’re getting paid better. Now the other side of the coin is what it’s done to the price of your hamburger at McDonald’s. And the Berkeley researchers tested that. And what they found was that there was a very minor increase in the average cost of food at fast-food places. And they basically compared it to about $0.15 on the price of a hamburger from McDonald’s.”
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