Staffing at Southern California’s fast-food restaurants continues to rise to record heights but job growth is cooling as the industry’s biggest players digest a $20-an-hour minimum wage mandate.
California fast food has been thrust into a grand economic experiment in which larger quick-serve chains, beginning April 1, must pay workers at least $4 an hour more than the state’s $16 wage floor. Industry leaders say the wage hike will hurt restaurant operators, forcing them to trim staff or hours worked, while boosting menu prices.
To measure how the fast-food job market is doing in the $20-an-hour era, my trusty spreadsheet looked at jobs data for “limited-service” restaurants as detailed by Employment Development Department for Los Angeles, Orange, Riverside and San Bernardino counties. It analyzed monthly hiring patterns for July, since March – just before the higher wage hit – and during the past 12 months.
In July, the four-county region had an all-time high of 363,500 fast-food workers. It’s the third consecutive month a new staffing record has been set for the industry.
Please note that these employment figures are not adjusted for seasonal swings in employment. So to gain historical context, let’s eyeball these recent changes against how local fast food bosses hired, on average, since 2010.
July 2024: Up 1,900 from June vs. adding 1,300 workers in a typical July.
March to July 2024: Up 9,600 vs. 6,200 in the typical March-to-July period.
Year ended July 2024: Up 4,100 in a year vs. typical 10,000 annual growth.
While fast food job growth has been brisk since spring, the drop in the annual pace is worrisome. Is that the $20 wage cooling job growth – or a softening economy?
Let’s ponder the restaurant industry’s fate vs. other Southern California employers.
Look at the competition: the region’s full-service eateries. They employed 292,900 in July – off 100 in a month, up 7,200 since March, and up 3,900 in a year. Historically, this industry has cut 500 workers in July and cut 100 jobs from March to July, but grew at a 4,300 annual pace since 2010.
So staffing at sit-down restaurants is growing roughly at its historic pace – somewhat better than fast food’s job expansion.
Next, peek across all industries in Southern California, where 7.96 million worked in July – that’s up 139,200 in a year. So, over these 12 months, there’s been 1.8% more jobs in the region overall. But fast food jobs are growing by 2.8%, and full-service eateries are up 2.4%. Staffing levels suggest dining out remains popular.
Ponder jobs at limited-service eateries sliced by the region’s metropolitan areas. Fast food was still boosting staff in Los Angeles County over 12 months, but there were job cuts in Orange County and the Inland Empire …
LA: record 199,100 fast-food workers in July – up 1,400 in a month, up 5,700 since March, and up 5,400 in a year. Historically, fast food has added 600 workers in July and added 3,200 March-to-July, and grew at a 5,300 annual pace since 2020.
IE: 89,900 fast-food workers in July – up 200 in a month, up 2,300 since March – but off 1,000 in a year. Since 2010, fast food has added 200 workers in July and added 1,500 March-to-July, and grew at a 2,700 annual pace since 2020.
OC: 74,500 fast-food workers in July – up 300 in a month, up 1,600 since March – but off 300 in a year. Historically, fast food has added 400 workers in July and added 1,600 March-to-July, and grew at a 1,900 annual pace since 2020.
Statewide, fast food employment also hit a record 750,500 in July – that’s also “non-seasonally adjusted” data – after gaining 5,800 workers from June, plus 15,500 since March. But staffing is up only 3,800 in a year.
Compare that staffing pattern to historic trends: fast food has added 3,100 workers in the average July since 2010 and added 13,100 March-to-July.
Again, notice a chill in the long-run pace: California fast food has averaged adding 19,000 workers annually since 2020.
The record staffing does not mean restaurant operators aren’t scrambling to stay ahead of higher wages. The figures don’t tell us if new jobs are at existing eateries or newly opened joints. Nor do we know if local fast food workers are staying employed but working fewer hours.
Remember, it’s very early in this test of a higher minimum wage for just one industry. Stay tuned.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
