In 2023, California passed a law requiring a $20 per hour minimum wage for all fast-food restaurants with more than 60 locations nationwide. Democratic Gov. Gavin Newsom portrayed the union-supported law as pro-worker, saying it moved the state “one step closer to fairer wages.”
Other California politicians supporting the law claimed it would provide a path to economic security for lower-income workers, enabling them to more assuredly put food on the table.
“Sacrifice, dedication, and the power of a government who serves its people is what got us to this moment,” said then-Assemblymember Chris Holden (D–Pasadena).
But the carve-out for smaller chains was an implicit acknowledgment that the law would come with costs—costs that smaller businesses with slimmer margins presumably could not afford. New research suggests that the mandate has also resulted in fewer jobs for struggling entry-level workers.
The law went into effect in April 2024 and increased the hourly pay of an estimated half a million workers across the state. But without the law in place, thousands more workers would likely have been employed.
Hellbound and Down 