Pizza Hut laying off delivery drivers ahead of California’s $20 minimum wage
In September this year, Gov. Gavin Newsome signed a bill raising California’s minimum wage for fast food workers to $20 an hour beginning April 2024. Expectedly, the law is already having some negative impact.
According to Business Insider, two Pizza Hut franchisees have already planned to lay off about 1,200 delivery drivers across California. This comes after McDonald’s and Chipotle already announced that they will raise prices in 2024.
How other businesses will respond is not too hard to predict. As time goes on, this trend will likely persist. Fast food companies will either let employees go, raise prices, or do both. After all, these higher labor costs have to be absorbed into the market somehow.
To anyone who cares to understand basic economics, this could have wholly been avoidable. The politicians of California, on the other hand, apparently did not see this coming. Speaking at the signing of the bill, Assemblyman Chris Holden declared the bill a victory, saying
We did not just raise the minimum wage to $20 an hour for fast food workers. We helped a father or mother feed their children, we helped a student put gas in their car, and helped a grandparent get their grandchild a birthday gift. Last month, when we were knee deep in negotiations, hundreds of workers slept in their cars and missed pay days to come give their testimony in committee and defend their livelihood. Sacrifice, dedication, and the power of a government who serves its people is what got us to this moment.
Thanks to this bill, numerous people are about to become jobless as the prices of food go up. Talk about a supersized order of irony.