AssetID: 53602579
Headline: UNCAPTIONED: Fast Food Chains Warn Consumers That Worker Pay Increases Will Impact Prices
Caption: Fast Food Chains Warn Consumers That Worker Pay Increases Will Impact Prices. 'Newsweek' reports that franchises have warned an increase of the minimum wage for fast food workers in California could also force menu prices to climb. As of April 1, fast food restaurants in California will have to pay employees at least $20 an hour, an increase of four dollars from the current $16 an hour. Business owners have warned that the new law, signed in by Democratic governor Gavin Newsom, will have an impact on margins and consumer costs. At the end of October, McDonald's CEO Chris Kempczinski said that the impact of the minimum wage rise would be partially "worked through with higher pricing". According to McDonald's numbers, the price of the signature Big Mac burger is currently $5.89 in California, the 10th highest in the United States. The latest data compiled by 'The Economist' shows that the average price of a Big Mac nationwide is currently $5.69, which is up from $5.36 at the same time in 2023. Last year, McDonald's reported net profits of almost $8.5 billion. According to the company's latest financial reports, sales increased 8.7% in the U.S. in 2023, which the company attributed to "strategic menu price increases". Meanwhile, Jack Hartnung, the CFO of fast food chain Chipotle, told investors that the wage increase would impact consumer prices with a "mid-to-high single digit" percentage increase. In December, Pizza Hut cited the wage increase as the reason behind laying off the company's in-house delivery drivers. THIS VIDEO MUST NOT BE EDITED FOR LENGTH TO COMBINE WITH OTHER CONTENT
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