Californias new $20-an-hour minimum wage law for fast food workers plunged visits to popular chains as restaurants like McDonalds, Wendys and Burger King hiked prices to offset higher costs, according to a study.
Californias new $20-an-hour minimum wage law for fast food workers led to price hikes and decreased foot traffic at popular chains including McDonalds, Wendys and Burger King, according to a study.
Since the new law went effect in April 1, foot traffic at Burger King fell 3.86%, while Wendys was down 3.24% and McDonalds slipped 2.5%, according to a report by analytics firm Placer.ai.
In-N-Out Burger, the popular fast food chain which also recently raised its menu prices on key items to cope with the increased labor costs, saw 2.59% fewer customers, while Jack in the Box visits were down 0.8%.
“Its early, but were starting to see the ripple effect of the minimum wage increase across the broader restaurant industry,” R.J. Hottovy, the head of analytical research at Placer.ai, wrote in the report.
The law which raised the minimum wage for fast food workers from $16 an hour to $20 — was also blamed for forcing companies like Rubios Coastal Grill to shutter dozens of locations across the state.
Rubios, which last week filed for Chapter 11 bankruptcy protection, cited significant increases to the minimum wage in California as a reason for the closings.
Another fast food restaurant, Fosters Freeze, recently closed a location near Fresno, saying the franchise owner could no longer afford to pay workers the upgraded salaries.
In the six-month period leading up to the new law being enacted, fast food prices in California rose on average by 7% — forcing franchisees in the state to slash work hours, postpone capital improvements and expedite the deployment of automation features such as self-serve kiosks.
The Placer.ai report found that casual dining chains may be benefiting from the erosion of traffic at fast food restaurants.
Olive Garden and Chilis locations in California have seen an uptick in visits that outperformed the national average since the minimum wage law went into effect, according to the report.
Between February and March of this year, Olive Garden saw a 1% increase in customer visits throughout California.
Since the increased minimum wage law went into effect, the figure jumped to 1.88%, according to Placer.ai.
Chilis saw a 3.6% decrease in visits throughout California in February and March.
But in the eight weeks spanning April and May, it saw an increase of 0.19% in visits, the report found.
Casual chains such as Chilis and Buffalo Wild Wings have sought to entice customers through value meals, such as the latters all you can eat wings promotion on Monday and Wednesday that has so far proven successful.
Fast food companies warned that the increased labor costs would be passed on to the consumer in the form of higher menu prices.
In Los Angeles County, a double-double burger combo at In-N-Out now goes for $11.44 — a $0.76 increase from last year, KTLA reported.
In San Francisco’s tourist-heavy Fishermans Wharf location, a double-double burger coupled with french fries and drink costs $13.63 after taxes.
Less hungry customers would still have to shell out $7.50 for the double patty without the sides or beverage, KRON4 reported.
A report published earlier this year by Kalinowski Equity Research found that fast food chains such as Wendy’s, Chipotle, Starbucks and Taco Bell raised their menu prices by as much as 8% in preparation for the new minimum wage law coming into effect.
Wendys raised its menu prices by around 8% while Chipotle Mexican Grill hiked its prices by approximately 7.5%, according to the report.
Starbucks, the Seattle-based coffee chain, raised the prices of its menu items at its California locations by around 7%, while Taco Bell hiked its prices 3%.
Seven people have been killed and dozens are injured after two bridges collapsed in Russia overnight.
A train derailed after a bridge collapsed on to it in the Bryansk region, killing the driver and six others.
Some 69 people were injured in the crash, with the train travelling from Moscow to Klimov at the time.
Earlier, local authorities blamed “illegal interference” for the incident.
Later, a bridge collapsed in Russia’s Kursk region while a freight train was passing over it.
Local officials said one of the train’s drivers was injured in the crash.
Image: The scene of the train crash in Kursk region. Pic: RIA/Telegram
Russia’s Baza Telegram channel, which often publishes information from sources in the security services and law enforcement, reported, without providing evidence, that the bridge in Bryansk was blown up, according to initial information.
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There was no immediate comment from Ukraine.
Since the start of the war that Russia launched more than three years ago, there have been continued cross-border shelling, drone strikes, and covert raids by Ukrainian forces into the Bryansk, Kursk and Belgorod regions that border Ukraine.
Image: Pic: Moscow Transport Prosecutor’s Office
Bryansk regional governor Alexander Bogomaz said: “Everything is being done to provide all necessary assistance to the victims.”
Emergency workers are at the scene of the train derailment, attempting to pull survivors from the wreckage.
Russia’s federal road transportation agency said the destroyed bridge passed above the railway tracks where the train was travelling.
Images from the scene show passenger cars ripped apart and lying amid fallen concrete from the collapsed bridge.
Other footage on social media appeared to be taken from inside vehicles which narrowly avoided driving onto the bridge before it collapsed.
At least 21 people have been killed in Gaza as they went to receive aid from an Israeli-backed foundation, according to a nearby hospital run by the Red Cross.
The hospital, which received the bodies, said another 175 people had been wounded in the incident in Rafah on Sunday morning.
The Associated Press also reports seeing dozens of people being treated at the hospital.
Witnesses have said those killed and injured were struck by gunfire which broke out at a roundabout near the distribution site.
The area is controlled by Israeli forces.
Ibrahim Abu Saoud, an eyewitness, said Israeli forces opened fire at people moving toward the aid distribution centre.
“There were many martyrs, including women,” the 40-year-old man said. “We were about 300 meters (yards) away from the military.”
Abu Saoud said he saw many people with gunshot wounds, including a young man who he said had died at the scene. “We weren’t able to help him,” he said.
The Gazans had been trying to receive aid from the Gaza Humanitarian Foundation – an American organisation backed by both the US and Israeli governments.
It operates as part of a controversial aid system which Israel and the US claims is aimed at preventing Hamas from siphoning off assistance.
Israel has not provided any evidence of systematic diversion, and the UN denies it has occurred.
Earlier, Hamas-linked media had also reported more than 20 deaths in Rafah, saying they were as a result of an Israeli strike on an aid distribution point. Israel is yet to comment.
The Gaza Humanitarian Foundation’s distribution of aid has been marred by chaos, and multiple witnesses have said Israeli troops fired on crowds near the delivery sites.
UN agencies and major aid groups have refused to work with the new system, saying it violates humanitarian principles because it allows Israel to control who receives aid and forces people to relocate to distribution sites, risking yet more mass displacement in the territory.
Before Sunday, at least six people had been killed and more than 50 wounded, according to local health officials.
The foundation says the private security contractors guarding its sites did not fire on the crowds, while the Israeli military has acknowledged firing warning shots.
The foundation did not immediately respond to a request for comment following the hospital’s claims.
In an earlier statement, it said it distributed 16 truckloads of aid early on Sunday “without incident”. It dismissed what it referred to as “false reporting about deaths, mass injuries and chaos”.
This breaking news story is being updated and more details will be published shortly.
The UK will buy up to 7,000 long-range missiles, rockets and drones and build at least six weapons factories in a £1.5bn push to rearm at a time of growing threats.
The plan, announced by the government over the weekend, will form part of Sir Keir Starmer’s long-awaited Strategic Defence Review, which will be published on Monday.
However, it lacks key details, including when the first arms plant will be built, when the first missile will be made, or even what kind of missiles, drones and rockets will be purchased.
The government is yet to appoint a new senior leader to take on the job of “national armaments director”, who will oversee the whole effort.
Andy Start, the incumbent head of Defence Equipment and Support – the branch of defence charged with buying kit – is still doing the beefed-up role of national armaments director as a sluggish process to recruit someone externally rumbles on.
Image: Sir Keir Starmer and Volodymyr Zelenskyy at a presentation of Ukrainian military drones. Pic: Reuters
Revealing some of its content ahead of time, the Ministry of Defence said the defence review will recommend an “always on” production capacity for munitions, drawing on lessons learned from Ukraine, which has demonstrated the vital importance of large production lines.
It will also call for an increase in stockpiles of munitions – something that is vitally needed for the army, Royal Navy and Royal Air Force to be able to keep fighting beyond a few days.
“The hard-fought lessons from [Vladimir] Putin’s illegal invasion of Ukraine show a military is only as strong as the industry that stands behind them,” John Healey, the defence secretary, said in a statement released on Saturday night.
“We are strengthening the UK’s industrial base to better deter our adversaries and make the UK secure at home and strong abroad.”
Image: Army Commandos load a 105mm Howitzer in Norway. Pic: Ministry of Defence/PA
The UK used to have a far more resilient defence industry during the Cold War, with the capacity to manufacture missiles and other weapons and ammunition at speed and at scale.
However, much of that depth, which costs money to sustain, was lost following the collapse of the Soviet Union in 1991, when successive governments switched funding priorities away from defence and into areas such as health, welfare and economic growth.
Even after Russia’s full-scale invasion of Ukraine in 2022 and a huge increase in demand from Kyiv for munitions from its allies, production lines at UK factories were slow to expand.
Image: A reaper drone in the Middle East. Pic: Ministry of Defence
Sky News visited a plant run by the defence company Thales in Belfast last year that makes N-LAW anti-tank missiles used in Ukraine. Its staff at the time only worked weekday shifts between 7am and 4pm.
Under this new initiative, the government said the UK will build at least six new “munitions and energetics” factories.
Energetic materials include explosives, propellants and pyrotechnics, which are required in the manufacturing of weapons.
There were no details, however, on whether these will be national factories or built in partnership with defence companies, or a timeline for this to happen.
There was also no information on where they would be located or what kind of weapons they would make.
Image: King Charles visits HMS Prince of Wales. Pic: PO Phot Rory Arnold/Ministry of Defence/PA
In addition, it was announced that the UK will buy “up to 7,000 UK-built long-range weapons for the UK Armed Forces”, though again without specifying what.
It is understood these weapons will include a mix of missiles, rockets and drones.
Sources within the defence industry criticised the lack of detail, which is so often the case with announcements by the Ministry of Defence.
The sources said small and medium-sized companies in particular are struggling to survive as they await clarity from the Ministry of Defence over a range of different contracts.
One source described a sense of “paralysis”.
The prime minister launched the defence review last July, almost a year ago. But there had been a sense of drift within the Ministry of Defence beforehand, in the run-up to last year’s general election.
The source said: “While the government’s intentions are laudable, the lack of detail in this announcement is indicative of how we treat defence in this country.
“Headline figures, unmatched by clear intent and delivery timelines which ultimately leave industry no closer to knowing what, or when, the MOD want their bombs and bullets.
“After nearly 18 months of decision and spending paralysis, what we need now is a clear demand signal from the Ministry of Defence that allows industry to start scaling production, not grand gestures with nothing to back it up.”
As well as rearming the nation, the government said the £1.5bn investment in new factories and weapons would create around 1,800 jobs across the UK.