Wage law is good news for . .. the robots

SIGN UP FOR THE DAILY JWR UPDATE. IT'S FREE. (AND NO SPAM!) Just click here.

In April, California imposed a $20-an-hour minimum wage on fast-food companies, a 25 percent hike. The results were swift and predictable. Within weeks, the Los Angeles Times reports, prices at McDonald's, Jack in the Box, Chipotle, Starbucks and other fast-food chains increased by "a mid- to high-single-digit percentage," one survey found.

Some operators have laid off employees — particularly delivery drivers. Other companies, the Times reports, have avoided layoffs by closing earlier, opening later and limiting employee hours. But the job losses are coming. Companies have also ramped up plans to automate and to use artificial intelligence thanks to the new wage floor.

"To hold the line on further price increases," the paper reported, "a growing number of fast-food operators are now racing to install as much automation as they can afford."

The owner of six El Pollo Loco stores in Southern California told the Times that she had resisted self-service kiosks because "we just didn't want to force our customers to use technology. We thought the personal contact was important." But the massive increase in labor costs forced her to reconsider.

Harshraj Ghai, whose family owns 180 fast-food restaurants throughout the state, said he has moved up his plans by several years to bring self-service kiosks to his stores. He's also looking at installing AI systems to handle the operations of the drive-thru windows. The economics of such moves pencil out now with the massive increase in personnel costs — one owner said the kiosk systems would pay for themselves within a year thanks to the concurrent savings in wages.

"Our goal isn't to get rid of people," Mr. Ghai told the Times. "We're in the people business at the end of the day." But because the wage mandate has forced more fast-food operators to embrace automation, in the long run, "we'll have fewer people."

That's not good news for the low-skilled workers who depend on such jobs, the retirees looking for a little extra income or the teenagers hoping to gain work experience. But it's the reality on the ground in California, where government central planners believe they can manipulate the marketplace with no ill effects.

The Democrats who dominate the Nevada Legislature should take notice. Following California on the minimum wage is a recipe for killing jobs.

(COMMENT, BELOW)

Previously:
• Joe Biden should commit to presidential debates
• Biden tax plan would pummel average Americans
• Iran's brazen attack on Israel was 'utterly unsuccessful'
• More free stuff
• Biden proposes another massive spending spree
• Dems increasingly desperate over No Labels
• Biden hams it up during stemwinder
• Economies roar in red states
• To establish 'absolute tyranny over these States'
• Biden condemns himself in attack on shrinkflation
• If only Taylor Swift were dating the national debt
• Biden bows to Putin, environmentalists
• Defenders of 'democracy' want Voter ID off ballot
• 'No one is safe if they had any hand in' Oct. 7
• Biden infrastructure bill: A failure to launch
• US government revenues hit record highs
• Why Biden can't convince voters he's beat inflation
• Why Biden can't convince voters he's beat inflation
• Biden needs to stop the mixed messages
• The hating class as brave defenders
• Blinken only emboldens Hamas terrorists
• White House green Slush fund throwing around cash
• Biden immigration policies souring even Dems
• Dems fret as the bad news mounts for Biden
• Billions in coronavirus money still sitting around
• Senate delegation reassures Israel; where's the House?
• Senate delegation reassures Israel; where's the House?
• Chicago takes victim blaming to an absurd new low
• The utter failure of money to improve education
• Group identity drives American division
• The downside of Biden's drug price control scheme
• WARNING: Here's why top insurers are fleeing
• 'They even laughed in my face'
• Red states power Biden's economy
• 'If you have private insurance, you can' … OOPS!
• Ignoring the Bill of Rights when its convenient
• Hunter cops a plea --- but the Biden probes continue
• Will we every truly know the depth of pandemic fraud?
• Hello there, Big Brother! Please, come right in
• Its not perfect, but it's a start on immigration reform
• IRS wants to branch out
• Gas stove ban conspiracy theory comes true
• Biden's busy bureaucrats beef up regulatory state
• Don't even dare think of emulamating New Yawk!
• Where have all the nation's college students gone?
• Soft-on-crime policies hit hard wall of political reality
• Joe Biden and Monty Python is no comedy
• Global warming was supposed to wreak havoc on polar bears. Looks like someone forgot to tell the polar bears