Just a reminder that the real minimum wage is $0. This is the result of rich liberal politicians thinking that they know better than everyone else. I’m sure that the thousands of newly employed Californians appreciate the liberals in Sacramento looking out for them.
With the minimum wage in California increasing to $20 an hour for fast food workers in 2024, some Pizza Hut franchisees say they’re preparing to eliminate jobs as well as delivery options for customers.
As first reported by ABC News Los Angeles station KABC, two major Pizza Hut franchisees with restaurants in Orange, Los Angeles, Riverside, San Bernardino and Ventura counties are planning layoffs that would impact 1,200 workers.
The mass layoffs would also reportedly impact another 800 workers at Pizza Hut locations in Sacramento, Central California, Southern Oregon, and the Reno-Tahoe area, according to KABC.
The cuts would eliminate the franchisees’ delivery services for customers in those locations, they said. Customers will instead have to rely on services like Uber Eats or DoorDash.
[…]
The wage legislation, AB 1228, which was signed into law by California Gov. Gavin Newsom in late September, is the catalyst for this decision by operators, the franchisees say.
[…]
Although a decision has not been made official, Chipotle CEO Jack Hartung said on a November earnings call that the pricing at the popular fast-casual Mexican restaurant would have to change “to take care of the dollar cost” and cover the new margins.
“We are definitely going to pass this on. We just haven’t made a final decision as to what level yet,” he said.
I don’t doubt that some of the job loss is due to the minimum wage, but if you look into it, many of the Pizza Hut locations are turning to Door Dash instead of local drivers.
Forgive me if I don’t completely believe them.
>“We are definitely going to pass this on. We just haven’t made a final decision as to what level yet,” he said.
That only works until your retail consumers determine that your new higher pricing holds less value. Then what? Prices will rise. There will be significant labor cutbacks. Consumer irritation with lower performance will only increase. There really isn’t much that can be done at the retail store level to overcome government mandated inflation and wage hikes. Consumers do not favor paying more for less. You can string out the street-level failures, but a creeping collapse to their industry is coming.
Consumer’s disposable income shifts to where they still find value. If other fast food chains are willing to operate with less profit margin… you lose market share to those competitors. If the entire fast food industry in California becomes perceived as having lost consumer value, even those competitors operating with lesser margins will lose volume. Nobody in their right mind will invest in a retail food franchise in California anytime soon.
No sympathy. The Kalifornia Fast Food industry shot itself the foot.
Exactly one year ago a Kali judge blocked Newsom’s attempt to raise the minimum FF wage to $22 by the end of THIS year. The industry filed suit, and collected a million+ signatures to put Newsom’s AB 257 to a referendum vote in November 2024.
Instead of following through, the industry then compromised and agreed to AB 1228, which, just like the SEIU pushed AB 257, creates a Newsom-handpicked council to control FF operations in Kalifornia….
(3) The Governor shall appoint the representatives of fast food restaurant employees, fast food restaurant franchisees or restaurant owners, the fast food restaurant industry, and the member of the public. The Speaker of the Assembly and the Senate Committee on Rules shall each appoint one representative of an advocate for fast food restaurant employees.
It’s called “Stacking The Deck”, And given that McDonald’s CEO Chris Kempczinski is lovin’ it (“We believe we’re in a better position than our competitors to weather this. And so let’s use this as an opportunity to actually accelerate our growth in California,”) it is not hard to guess who Newsome will be picking as industry reps for his Kommie Kouncil.
Side Bar: $777 billion in state debt, yet….
(6) Each member of the council shall receive one hundred dollars ($100) for each day of their actual attendance at meetings of the council and other official business of the council, in addition to their actual necessary traveling expenses incurred in the performance of their duties as a member.
(7) The council may employ necessary assistants, officers, experts, and other employees as it deems necessary, subject to appropriation.
>We believe we’re in a better position than our competitors to weather this.
Ah the shortsighted-ness of executive leadership when it’s on public display shows that most of these people cannot tie their own shoes without risk of injury.
The phrase Weather the Storm… If someone weathers the storm, they succeed in reaching the end of a very difficult period without much harm or damage. Who here thinks there’s an END to this? The only way this ends is when California breaks off the mainland in it’s continuing journey to China.
McDonald’s CEO Chris Kempczinski is lovin’ it
First time in known commercial history where a large, established, business created roadblocks for upstarts! /sarc