California’s controversial $20-an-hour fast-food minimum wage is taking another bite out of the restaurant industry, with at least 16 fast-food locations across the Fresno area shutting their doors since the start of 2025.
The wave of closures has left vacant storefronts stretching across Fresno, Clovis, Hanford, Merced, Kerman and Visalia, as franchise owners warn the state’s soaring labor costs have become the latest blow to an industry already battling sky-high food, insurance and utility bills.
Among the chains that have lost locations are KFC, Carl’s Jr., Five Guys, Wendy’s, Popeyes Louisiana Kitchen and Jack in the Box.
Restaurant operators say the rash of closures shows just how difficult it has become to keep fast-food restaurants afloat in California, where expenses continue to outpace sales.
“Almost 80% are expecting costs across the board to go up — energy costs, insurance costs, labor costs, food costs,” Jot Condie, CEO of the California Restaurant Association told the Fresno Bee.
At the same time, consumers worried about the economy are cutting back on restaurant spending, leaving operators squeezed by rising expenses and weaker demand.
“In the industry that has roughly a 1 to 3% profit margin on average in California, there’s no room for error,” Condie said.
Condie said California’s $20 fast-food wage has become one of the most “devastating” financial burdens facing qualifying restaurant operators.
“When you talk to restaurant operators who have closed locations, they will always cite that,” he said.
The $20 hourly wage took effect on April 1, 2024, after Gov. Gavin Newsom signed Assembly Bill 1228 into law.
The law applies to fast-food restaurants that are part of chains with at least 60 locations nationwide.
California’s statewide minimum wage is $16.90 per hour.
The measure was approved by the California Legislature rather than California voters, meaning residents never cast ballots on the statewide wage mandate.
For franchise owners, the higher wages are paid directly out of business revenue, adding to a growing list of expenses that many smaller operators say are increasingly difficult to absorb.
KFC has been among the hardest hit chains, closing six restaurants from downtown Fresno to Clovis beginning in 2025, including its “next-gen” location in northwest Fresno.
Its Kerman restaurant also closed earlier this year.
Carl’s Jr. closed three Central Valley restaurants, including its Fresno location at First Street and Shaw Avenue on June 27, its McKinley Avenue restaurant near Winery Avenue in February, and its Visalia location on Chinowth Street near Highway 198 last month.
Five Guys shuttered its Merced restaurant on June 26 before closing its Hanford location on July 4.
Jack in the Box closed its Cedar and Nees avenues restaurant recently.
Popeyes Louisiana Kitchen closed its First Street and McKinley Avenue location in spring 2025, while Wendy’s exited both its downtown Fresno restaurant in late 2025 and its West Shaw Avenue location earlier this year.
Meanwhile, the state body created to oversee California’s fast-food industry has been unable to meet for months despite operating with a $1.1 million taxpayer-funded budget.
The California Fast Food Council has not held a full meeting since a minor subcommittee hearing in February 2025.
Chair Nick Hardeman resigned in May 2025 after Newsom appointed him to another state housing board.
Because the governor has not appointed a replacement, state officials acknowledge the council cannot legally convene, even though state law requires it to meet at least once every six months.