CA Fast-Food Workers Get Wage Hike; Businesses Up Prices, Some Plan Closures

California's fast-food workers are seeing significant increases in their paychecks after a new minimum wage law raised wages from $16 to $20 an hour. 

Since April 1, employees at major fast-food chains with at least 60 locations nationwide experienced this pay jump. The legislation aims to provide a living wage for these workers in a state renowned for its high cost of living.

While the wage increase is a cause for celebration among many workers, business owners are concerned about the financial implications.

Many are planning to offset the increased labor costs by raising prices for consumers.

Ingrid Vilorio, a fast-food worker, expressed her satisfaction with the wage increase, stating, "The $20 raise is great. I wish this would have come sooner." 

This sentiment was echoed by Sergio Valdearama, a McDonald's employee, who highlighted the personal benefits of the pay bump, noting that it would allow him to spend more time with his family.

However, the wage increase has also led to concerns among business owners about maintaining profitability.

Alex Johnson, who owns 10 Auntie Anne's and Cinnabon stores in California, expects roughly $500,000 in increased operational costs spread across those stores and worries it could force him to close his businesses. 

The impact of the wage increase is felt statewide, with many fast-food restaurants staff feeling forced to pass the increased costs onto customer, including those managed by Kerri Harper-Howie, who oversees 21 McDonald's locations.

Harper-Howie expressed concern about how the price hikes would be received, especially since not all customers can afford them.

The situation highlights a broader trend of businesses grappling with rising labor costs, leading some to reduce staff hours, lay off employees, or consider replacing human workers with AI or robots to manage expenses.