A new white paper from the Pepperdine School of Public Policy and Beacon Economics presents compelling evidence that California’s Fast Act (AB 1228) has led to significant job losses in the state’s fast-food industry.
The white paper, “Jumping the Gun on the Fast Act,” analyzes newly revised employment data from the California Employment Development Department (EDD), and challenges prior reports that suggested the wage increase had minimal negative impact.
The study reveals that revised employment estimates show a decline of over 23,100 jobs (3.2%) in the limited-service restaurant sector over the past year, while the rest of the U.S. saw growth of 0.8% in the same category. The findings suggest that early claims of the Fast Act’s success were premature and based on incomplete data.
“This new data should be a wake-up call for policymakers,” said Christopher Thornberg, Founding Partner at Beacon Economics. “The employment losses in California’s fast-food industry are now evident, and they confirm what many had warned about: drastic wage hikes create real economic consequences, especially for entry-level workers.”
The white paper, a partnership project between Pepperdine School of Public Policy and Beacon Economics, warns that the negative effects of the Fast Act may well extend beyond employment numbers, with potential long-term impacts on business sustainability, employee work hours, and benefits. Given these findings, the white paper urges the Fast Food Council to halt any further regulatory changes until unbiased, comprehensive research is conducted.
The full paper can be downloaded here.