A McDonald’s that served customers for 30 years just closed its doors forever.

Not because of bad food, not because nobody showed up.

The franchisee said it himself.

The economics just do not work anymore.

I’m Elizabeth Davis and this is Elizabeth Davis.

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What I’m about to show you is happening in real time across California, and it’s spreading.

Scott Rodrik ran a McDonald’s at Stonestown Galleria in San Francisco for three decades, 30 years of Big Macs, Happy Meals, and McFlurries.

In June 2024, he posted a note on the door saying goodbye.

He wrote that unprecedented changes to the economic landscape of California, coupled with illtimed legislative mandates, greatly narrowed the restaurant’s path forward.

That is corporate speak for I cannot make money here anymore.

He called the closure gut-wrenching for his family.

This was not a corporate decision made in a boardroom.

This was a man who built something for 30 years watching it disappear.

And he is not alone.

In the last 18 months, California’s fast food industry has lost somewhere between 10,000 and 23,000 jobs, depending on which study you believe.

Pizza Hut fired 1,200 delivery drivers before the new wage law even started.

Rubio’s closed 48 locations and filed for bankruptcy twice in four years.

We are talking about over 500,000 fast food workers affected across the state.

Half a million people saw their jobs, hours, and paychecks change overnight.

So, what is actually happening to California’s fast food industry? Before we start, what state are you watching from? Are you still shopping at McDonald’s? I would like to know.

Let me show you the numbers.

If you want to understand why your Big Mac costs what it costs now, stay with me because the numbers I am about to show you explain everything about what is happening to fast food in America.

On April 1st, 2024, California’s minimum wage for fast food workers jumped from $16 to $20 an hour.

That is a 25% increase overnight for workers at chains with 60 or more locations nationwide.

We are talking about more than 500,000 fast food workers at roughly 30,000 restaurants across California.

That is bigger than the entire population of some states.

Now, $20 an hour sounds great for workers.

That is $41,600 a year if you work full-time.

But here is what the studies actually found.

The National Bureau of Economic Research, serious academic economists from UC San Diego and Texas&M, published a study in July 2025.

Their finding, California’s fast food sector lost approximately 18,000 jobs compared to what would have happened without the wage increase.

Employment declined 2.7% relative to the rest of the country.

While fast food jobs were growing everywhere else in America, California was shrinking.

Another economist, Christopher Thornberg of Beacon Economics, put the number even higher.

23,100 jobs lost in the past year.

The California Employment Development Department revised its estimates and said limited service restaurants experienced a reduction of 21,500 jobs.

And here is the twist that nobody expected.

A third study came from the Berkeley Research Group.

This study was funded by the same union that pushed for the $20 wage.

Even that study found 10,700 jobs lost.

They described it as the steepest decline this century outside of the Great Recession and the pandemic.

Think about that.

The people who wanted the wage increase had to admit that jobs disappeared.

Three different studies, three different numbers, but they all point in the same direction.

Job losses are real.

Now, let me tell you what makes this even more fascinating.

The layoffs started before the law even took effect.

Pizza Hut franchises in California looked at the calendar in December 2023, did the math, and made a decision.

They filed notices announcing they were eliminating all delivery driver positions.

Every single one.

Pack Pizza and Southern California Pizza Company together cut over,200 jobs across Orange, Los Angeles, Riverside, San Bernardino, and Ventura counties.

Another 800 workers were hit in Sacramento, Central California, and the Reno Tahoe area.

One driver who worked at Pizza Hut for 9 years told Business Insider he was offered $400 in severance.

$400 for nine years of delivering pizzas.

That is about $44 per year of loyalty.

After the layoffs, customers had to use Door Dash, GrubHub, or Uber Eats if they wanted pizza delivered.

Pizza Hut basically said it was not their problem anymore.

But Pizza Hut was not alone.

Have you noticed your favorite fast food spot disappearing? Drop a comment and tell me which restaurants have closed near you.

I want to know what is happening in your area.

Let me tell you about Rubio’s Coastal Grill.

This is the company that invented the fish taco.

Started in San Diego in 1983.

At their peak, they had nearly 200 restaurants.

On May 31st, 2024, Rubio’s closed 48 California locations in a single day.

13 in San Diego, 24 in the Los Angeles area, 11 in Northern California.

Just like that, employees showed up and found out they did not have jobs anymore.

5 days later, Rubio’s filed for Chapter 11 bankruptcy with over $1 billion in debt and less than $30 million cash on hand.

And here is the kicker.

It was their second bankruptcy in four years.

Their chief restructuring officer said the company had been negatively affected by diminishing instore traffic attributable to work from home practices and by rising food and utility costs, combined with significant increases to the minimum wage in California.

These factors put pressure on a number of locations.

Translation: people stopped coming in, costs went up, and the math stopped working.

Rubio’s got sold to its lenders in August 2024 for about $40 million.

To put that in perspective, private equity firm Milroad Capital bought Rubio’s in 2010 for $91 million.

So, in 14 years, the company lost more than half its value.

That is what I call a fire sale.

Now, here is where the franchise owner numbers get really interesting.

Alex Johnson operates 10 fast food locations in California.

He estimated the wage increase would cost his restaurants $470,000 total.

That is nearly half a million in extra labor costs for one operator with 10 locations.

Scott Rodrik, the same guy who closed that San Francisco McDonald’s, owns 18 McDonald’s locations across California.

He raised prices 5 to 7% in just 3 months.

Anticipating the wage hike, he started postponing capital expenses, things like updating dining rooms, buying new grills, and replacing rooftop HVAC systems.

When you are choosing between fixing your equipment and paying your workers, something is fundamentally broken in the business model.

Now, let me tell you about the closure that broke my heart a little.

Fosters Freeze in Lore, California.

It is a small town about 3 hours north of Los Angeles.

The owner, Lauren Wright, had been running this location for years.

On April 1st, 2024, the exact same day the $20 minimum wage kicked in, he closed the doors forever.

Some employees thought it was an April Fool’s joke.

They got a text in their group chat saying the store was shutting down and they did not believe it.

The owner texted a local reporter that the last thing he ever wanted was to close down.

By Friday night, he knew it was likely he could not keep the store open, but he did not want to ruin their Easter Sunday.

The assistant general manager, Monica Navaro, said she found out when two of her co-workers showed up to clock in.

That is when she received a phone call saying they were done.

Here is what Monica said that really stuck with me.

Monica said that the people she spoke to, her employees, would have rather stayed at the wage they had before because now they do not have a job.

Let that sink in.

The workers themselves said they would rather make $16 an hour than $0 an hour.

If this is making you think differently about what is happening to fast food, hit that like button.

It helps more people see what is really going on.

But Monica pointed out something else that nobody talks about.

Those who still work in areas where wages went up to $20 an hour had their hours severely cut and far fewer people are working each shift.

So the jobs became much more difficult.

The Competitive Enterprise Institute found that 89% of California fast food workers have had their hours reduced since the wage increase.

89%.

And 35% lost supplemental benefits on top of that.

So, you might be making $20 an hour, but if you only get 20 hours a week instead of 35, you actually take home less money.

Edgar Ramos works at a Wing Stop in Los Angeles.

His pay bumped from 1725 to $20 in April 2024.

Sounds great, right? But now he only works about 20 hours a week.

He told CNN he fights to get more time on the schedule.

He said it makes no sense because if you are cutting hours for your current workers, why are you hiring new people and blaming the increase of the wage? That is the math that nobody wants to talk about.

Now, let me show you what happened to prices.

McDonald’s chief executive Chris Kempinski said it plainly on an earnings call.

He said, “There is going to be a wage impact for our California franchises, and certainly there is going to be some element of that that does need to be worked through with higher pricing.

” Translation, you are paying for the wage increase.

California restaurant prices increased 14.5% between September 2023 and December 2024.

The national average during the same period was only 8.2%.

California prices jumped nearly double the national rate.

Chipotle’s chief executive Brian Nickel put it simply.

He said the state is not making it easy.

Chipotle raised prices 6 to 7% in California in the first week of April 2024 alone.

But here is what really blows my mind about McDonald’s prices nationally.

According to Finance Buzz, McDonald’s menu prices have increased 100% since 2014.

That means they have doubled.

A McChicken sandwich went from $1 to $2.99.

A quarter pounder with cheese meal went from $539 to nearly $12.

McDonald’s President Joe Erlinger admitted that menu prices are up about 40% since 2019 alone.

Kemp Zinski also admitted customers making less than $45,000 a year have stopped ordering from McDonald’s.

He said eating at home has become more affordable.

And he said the battleground is certainly with that lowincome consumer.

When McDonald’s, the company built on affordable fast food, admits that eating at home is cheaper than its restaurants, something has fundamentally shifted.

Not everyone is failing.

Carrie Harper Howey and her sister Nicole own 21 McDonald’s restaurants across Los Angeles County.

They own every single McDonald’s in the city of Compton, and they employ over 1,400 people.

Their family has been in the McDonald’s business since 1984 when their parents cashed out their retirement savings to buy their first location.

and they are still operating, still employing people, still growing.

Same state, same wage laws, same economic pressures, different outcomes.

When asked about the wage increase, Carrie said, “You cannot raise prices enough to cover the costs.” But she is adapting.

She put a supervisor in charge of going to every restaurant and doing food cost analysis.

Are they giving out too many ketchup packets? Are they putting too many squirts of sauce on the Big Mac? That is what it has come to.

counting ketchup packets to survive.

The pattern is clear.

Higher costs, higher prices, fewer hours, fewer jobs, and for some businesses, closed doors forever.

California’s fast food industry is not dead.

McDonald’s still has over 1,400 locations in the state.

Chick-fil-A lines still wrap around the building, but the industry is transforming.

The workers who keep their jobs make more per hour, but often work fewer hours.

Customers pay more for the same food.

Franchises either adapt or close and the companies that cannot figure out the math, they disappear.

Monica Navaro from that Fosters Freeze said something that haunts me.

She said this is not the first business to close.

She said there are already a few local businesses.

She is right and based on these numbers, there will be more.

What fast food restaurants have disappeared from your neighborhood? Drop a comment and let me know.

I am genuinely curious what is changing where you live.

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Share this video with anyone who needs to understand what is happening to California’s economy.

The decisions being made today will affect millions of workers and families for years to come.

This is not just about hamburgers.

This is about the future of work in America.

Stay informed, stay aware, and keep watching.