Search on TFTC
Low-Skill Jobs Vanish as California Hikes Wages to $20

Low-Skill Jobs Vanish as California Hikes Wages to $20

Apr 9, 2024

Low-Skill Jobs Vanish as California Hikes Wages to $20

In the Golden State, a new legislative mandate has served up an economic disaster for fast food workers, setting the minimum wage at an unprecedented $20 per hour. This legislative move, however, has quickly simmered into controversy with notable economists, as per the Wall Street Journal, branding it as a "crazy" economic strategy.

The Wall Street Journal

The bill in question not only hikes the minimum wage from $16 to $20 but also establishes a "fast food council" with the power to annually increase this wage by an additional 3.5%. This could potentially elevate the minimum wage to $30 within the next ten years.

California Department of Industrial Relations

The repercussions of this bill, though, have manifested faster than a quick-service meal. California's fast food industry, which employs roughly half a million workers and serves about 70% of the state's population, is now facing a seismic shift. Companies have halted hiring, and mass layoffs have been announced, starting with roughly 1,100 Pizza Hut delivery drivers, followed by staff at Roundtable pizza chain. The layoffs are only the beginning as many fast food employees are now vulnerable.

USA Today

In a bid to counterbalance the wage increase, companies like Jack in the Box and El Pollo Loco are turning to robotics to automate cooking and cashier functions, including tasks like frying and salsa-making. McDonald's, not far behind, has invested millions in designing fully automated stores with their first robotic store opening last year, cutting out the need for human workers entirely.


One argument against the minimum wage is that it essentially bans low-skilled work worth less than the stipulated amount. This could leave many low-skilled workers, who may not be valued at $20 per hour, without legal employment opportunities, pushing them towards informal jobs or welfare dependency.

The unfolding situation in California is a microcosm of a broader narrative unfolding across the United States and the Western world, where over 50 million individuals earning under $20 an hour could find themselves on the proverbial chopping block, all in the name of vote-winning strategies under a socialist banner.

As California leads the way with this economic experiment, the nation watches with bated breath. Will it serve as a harsh lesson in the delicate balance of labor economics? Only time will tell.


Current Block Height

Current Mempool Size

Current Difficulty