The Californian Exodus Continues as a Major Pizza Chain Relocates to Georgia
CLARIFICATION, June 13, 2024: Los Angeles Times business columnist Michael Hiltzik noted that the figure of nearly 10,000 jobs lost because of the $20 minimum wage in California was not seasonally adjusted. The article has been updated to make that clear and to identify the source of that number.
California has been one of the top states to flee for both citizens and businesses — and now the Golden State has lost another major company.
Blaze Pizza announced last week that it is abandoning California to re-establish its headquarters in Georgia.
The fast-casual dining establishment, which was founded in California in 2011, is known for its Subway-like setup where customers pick the toppings they want from various fresh ingredients as employees assemble their specially ordered pizza in front of them.
But California no longer will be the home base for the company, which counts NBA star LeBron James as an investor, the industry site Restaurant Business reported June 4.
Blaze Pizza said its move to Georgia will be completed by September. Most of the company’s 60 corporate employees will work remotely, while a small percentage will be asked to relocate to the new campus in Atlanta.
“California is where this brand was born more than a decade ago, and we have a tremendous heart for communities across the state where so many of our restaurants are,” CEO Beto Guajardo said in a statement. “Moving our corporate headquarters to Atlanta will help us drive our next wave of growth.”
As 2023 came to a close, the pizza chain counted 295 restaurants in the United States — with 93 locations in California, KTLA-TV reported.
According to data compiled by Build Remote, at least 100 companies have fled the Golden State since 2020. Nearly half of them went to Texas, but other states are increasingly welcoming California companies, including Arizona, Florida, Colorado, North Carolina and Ohio.
Blaze Pizza did not offer any reasons for its big move, but California recently burdened its fast-food industry with a new $20-per-hour minimum wage.
The legislation, signed into law by Democratic Gov. Gavin Newsom, has cost the state some 10,000 jobs and counting in the restaurant sector, according to an April 24 report by Hoover Institution economist Lee Ohanian.
(That figure was not seasonally adjusted, as noted by Los Angeles Times business columnist Michael Hiltzik on Wednesday.)
The loss of revenue and jobs has been so steep that the California Business and Industrial Alliance trade group published a full-page ad this month featuring an “In Memoriam” rundown of the companies that have fired workers thanks to the rising costs in the anti-business state.
📢 Today, we called out @GavinNewsom in a full-page ad in USA Today for the harmful impact of California’s recent minimum wage hike on fast-food restaurants. Nearly 10,000 jobs lost since AB 1228 was signed into law. CA deserves better policies that support growth and stability.… pic.twitter.com/CCpAk3L2j0
— @cabia (@cabia_speakup) June 6, 2024
The ad noted that two Pizza Hut owners eliminated all delivery drivers, and more than 1,200 drivers were impacted.
Then there is the franchise owner who operates 140 Burger King locations and said he intended to “slash worker’ hours and expedite the rollout of self-service kiosks to cut down on labor costs in response to the state’s new $20 minimum wage,” the ad said.
CABIA also reported that Scott Roderick, a McDonald’s franchisee who owns 18 California locations, said he has had to “rethink his business strategy in the wake of the new law.”
“There is more than extraordinary labor costs stressing restaurants P&Ls right now,” Roderick said, referring to profits and losses.
The new minimum-wage law has also negatively affected employees at Cinnabon/Auntie Anne’s, El Pollo Loco, Excalibur Pizza, Mod Pizza, Rubio’s, Vitality Bowls and other businesses in the state.
Last week, Rubio’s Coastal Grill was the latest to announce that it was closing restaurants in California. The company said it was shuttering 48 locations because of the new minimum-wage law.
“Making the decision to close a store is never an easy one,” the company said. “The closings were brought about by the rising cost of doing business in California.”
The minimum-wage law was approved by the Democrat-controlled state Legislature last year and went into effect April 1, forcing most — but not all — fast-food operations to pay workers $20 an hour.
These onerous laws are business killers and take more jobs away from the very people they claim to want to help. Such laws also end up chasing both businesses and citizens out of the state and to other, more prosperous states. California has lost so many citizens that the state is on track to lose several seats in Congress.
It’s all more evidence that, as Dennis Prager says, the left destroys everything it touches.
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