Fast‑food wage study
A University of California study on California’s $20/hour fast‑food minimum wage found no job losses across more than 2,000 restaurants, with menu prices rising only about 1.5% and average worker pay increasing by over 10%. The data sample covered thousands of outlets and quantified both employment and price effects. (x.com)
California’s $20 fast-food minimum wage raised pay by 10% to 11% and did not reduce employment, according to a revised University of California, Berkeley working paper. (irle.berkeley.edu) The paper by Michael Reich and Denis Sosinskiy examines the policy that took effect on April 1, 2024, covering workers at large fast-food chains and snack and nonalcoholic beverage bars in California. The authors used survey and administrative wage and employment data, Glassdoor pay data, and menu prices scraped from more than 2,000 restaurants in California and comparison states. (irle.berkeley.edu) The Berkeley paper says prices rose 2.1% relative to control states two quarters after the law took effect, which it translates to about 8 cents on a $4 item. It says employers passed about 63% of higher wage costs to consumers. (irle.berkeley.edu) California created the $20 floor in September 2023, when Governor Gavin Newsom signed Assembly Bill 1228. The governor’s office said at the time the law would apply to roughly 500,000 fast-food workers and would start on April 1, 2024. (gov.ca.gov) The findings land in an argument that has run since the law was signed: whether a large, sector-specific wage increase would lift pay without cutting jobs. The Berkeley authors describe the new wage floor as equal to 69% of California’s median full-time wage, a level they say exceeds earlier minimum-wage research benchmarks. (irle.berkeley.edu) Other researchers have reached different conclusions. A National Bureau of Economic Research working paper by Jeffrey Clemens, Olivia Edwards, and Jonathan Meer estimated a 2.7% to 3.2% relative employment decline, with a median estimate equal to about 18,000 jobs, using Quarterly Census of Employment and Wages data from September 2023 through September 2024. (nber.org) A separate March 2025 paper by Naser Hamdi and David Sovich, using anonymized payroll data, found significantly higher wages, lower turnover, and employment that “rose slightly” because hiring slowed by less than turnover fell. That paper also found no spillover employment or wage effects in other low-wage sectors. (haslam.utk.edu) Industry-backed research has been more negative. A February 2025 report commissioned by Save Local Restaurants said the California limited-service restaurant sector lost 10,700 jobs between June 2023 and June 2024 and that menu prices at California fast-food restaurants rose 14.5% between September 2023 and October 2024. (savelocalrestaurantsca.com) The split comes down in part to methods and definitions: which restaurants count as covered fast food, which states make the best comparison group, and whether to measure headcount, hours, turnover, or posted prices. The Berkeley paper says its September 2025 revision adds Quarterly Census of Employment and Wages data through the fourth quarter of 2024, extending an earlier September 2024 version. (irle.berkeley.edu) For now, the newest Berkeley result adds one more data point to a fight that has moved from campaign rhetoric to dueling working papers. The core dispute is no longer whether the wage floor changed pay; it is how much of the adjustment showed up in jobs, hours, and prices. (irle.berkeley.edu)
