Report: California’s $20 Fast Food Minimum Wage Led to 18,000 Fewer Jobs

California’s new $20-per-hour minimum wage for fast food workers has resulted in a significant decline in employment in that sector, leading to 18,000 fewer jobs than would have been the case otherwise.

That’s according to a new paper released by the National Bureau of Economic Research (NBER) this month, which said:

We analyze the effect of California’s $20 fast food minimum wage, which was enacted in September 2023 and went into effect in April 2024, on employment in the fast food sector. In unadjusted data from the Quarterly Census of Employment and Wages, we find that employment in California’s fast food sector declined by 2.7 percent relative to employment in the fast food sector elsewhere in the United States from September 2023 through September 2024. Adjusting for pre-AB 1228 trends increases this differential decline to 3.2 percent, while netting out the equivalent employment changes in non-minimum-wage-intensive industries further increases the decline. Our median estimate translates into a loss of 18,000 jobs in California’s fast food sector relative to the counterfactual.

HR Grapevine added:

The Employment Policies Institute estimated that “non-tipped restaurant workers [lost] 250 hours of work annually,” translating into up to $4,000 in lost income. That drop equates to seven weeks of work each year per employee.

The California Globe reported that “thousands of fast food jobs were shed by companies in anticipation for the higher costs,” including 1,200 drivers at Pizza Hut. Once the law took effect on April 1, 2024, “restaurants automated what they could to avoid the higher wages,” and “some fast food restaurants also closed.”

By June 2024, Stanford University data indicated “over 10,000 fast food jobs were already lost.” While the Governor’s office disputed the figure, saying fast food jobs had increased, it “stopped by the fall when it became apparent that federal data wasn’t on their side.”

Breitbart News had reported earlier:

In April [2025], a major fast food franchisee said he was rushing to install kiosks at his restaurants to save money as the $20 minimum wage took effect, Breitbart News reported at the time.

A few months later, the outlet said approximately 10,000 jobs were reportedly cut at California fast food restaurants following the minimum wage hike.

On New Year’s Day 2025, a rise in minimum hourly wages hit nearly half of the states in the U.S. and 48 counties, Breitbart News reported.

Meanwhile, the recent study also found that technology is replacing some workers, per KMPH.

California Gov. Gavin Newsom (D) signed the minimum wage increase into law and has publicly defended it.

The Golden State currently has the highest unemployment rate in the U.S., though still relatively low at 5.4%.