After the new wages took effect on April 1st, many businesses already struggling with their finances had no choice but to close their doors.

After being questioned by the press, an assistant manager claimed that the store could no longer keep up with the minimum wage hike.

After receiving the communication, many employees assumed that the text sent on April 1st was merely an April fools prank.

The unemployment rate skyrocketed to 5.3% as of February and will continue to increase as fast-food restaurants close their doors and lay off employees.

The law passed by Governor Gavin Newsome last fall ensures that any fast-food chain with more than 60 locations will need to pay their staff a minimum wage of $20. The plan intended to help fast-food employees who work in expensive areas.

The higher wages take funds out of profits for big companies. Many of the major fast-food chains have the capital and ability to implement new technologies that make cashiers redundant.

The number of workers has decreased by 1.3% since last September.

Currently, other countries with a high minimum wage already pay employees while still turning a profit. In Denmark, McDonalds employees make $22 an hour to start with six weeks of vacation.

The chain has stated that this is the consequence of raising the wage to a more livable standard in expensive places like California.

The Texas Double Whopper increased from $15.09 to $16.80 after the wage increase.

Micheal Lewis, the owner of the Barstow location, says that he has no plan to close the family-owned operation.

They have the funds to pay for the $20 minimum wage and have offered to hire the laid off workers.

This approach minimizes the strain on labor and allows businesses to maintain profitability despite higher wages. Others have expanded their use of online ordering systems to reduce the need for in-store staff.

Economists predict a slight downturn in local economic activity in the short term, which may prompt a reevaluation of business strategies across the region.

This pattern suggests that while the impact is initially disruptive, long-term effects might be less severe as businesses and workers adapt.

Such strategies might have allowed them to remain operational while adjusting to the new economic realities.

Such measures could alleviate some of the financial pressure and prevent further closures.

However, these states have introduced gradual increases coupled with supportive measures for small businesses, which have helped mitigate the immediate negative impacts seen in California.

Some argue it boosts worker living standards and stimulates local economies through increased spending. Others caution it could lead to more automation and job losses, particularly in the fast-food industry.

“We had gotten a text in the group chat that we were shutting down, and I completely thought it was an April Fools joke,” former employee Jason Boado told Fox 26 News.

Proponents argue it’s essential for living in high-cost areas, while critics warn it could harm those it aims to help by forcing businesses to cut jobs or close.

This could lead to a significant transformation in how fast food is served, with a potential increase in self-service technologies and fewer staffed counters.

Kiosks for ordering and robots for food preparation are becoming more common in California, signaling a shift in how the industry manages its workforce.

These changes are intended to balance worker welfare with business sustainability, ensuring the economic landscape remains conducive to both employment and entrepreneurship.