Restaurant owners in California are feeling the heat as the state’s new $20 minimum wage law goes into effect. One such owner, Alex Johnson, who runs multiple Cinnabon and Auntie Anne’s locations, has decided to take his business elsewhere due to the regulations and high minimum wage.
The new law specifically targets restaurants with at least 60 locations nationwide, excluding those that make and sell their own bread. This has caused concern among restaurant owners, who fear that the increased pay will lead to job cuts and ultimately result in higher prices for consumers.
Already, several California food chains have announced layoffs in response to the law. Johnson is contemplating raising prices and leaving vacant positions unfilled in order to cope with the financial strain caused by the new legislation. He has stated that he will no longer be expanding his business in California.
Governor Gavin Newsom signed the controversial legislation in September, which also established a “Fast Food Council” to oversee pay increases and set standards for working conditions in the fast-food industry. Newsom defended the law, calling it a “big deal” and rejecting the notion that fast-food jobs are only meant for teenagers entering the workforce.
As restaurant owners grapple with the implications of the new minimum wage law, many are left wondering how they will navigate the challenges ahead in an already competitive industry.
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