Historic Restaurant Shuts Down Due To Wage Increases

(IntegrityPress.org) – Businesses across California are feeling the effects of the hike in fast-food industry worker’s minimum wages.

One such business is a McDonald’s restaurant that has been in operation for more than 30 years. The Stonestown Galleria McDonald’s sits about eight miles away from San Francisco’s downtown area and has proved a popular spot for three decades. However, the owner of this particular franchise has announced its closure due to the untenable costs of operation.

Scott Rodick posted a farewell note on the door of his now-closed McDonald’s restaurant in which he described his gratitude to his former customers. He also said that all of his employees had been offered job opportunities at another nearby McDonald’s restaurant. He later confirmed that most of his employees had accepted job roles within the McDonald’s chain following their store’s closure.

Speaking to reporters about his decision to close the store, Rodick explained that the reasons were purely financial. Describing the decision as “gut-wrenching”, he said that he had not been able to negotiate a reasonable rent with the property’s landlord, and that property taxes in the area were high. He also had an additional tenancy fee to pay to the mall that his McDonald’s restaurant was a part of.

As well as these property-related costs, Rodick attributed some blame to the large hike in salary costs. With minimum wage for fast-food workers jumping in April from $16 per hour to $20 per hour, Rodick and many other business owners have struggled to be able to afford to pay their staff. Rubio’s Grill, a popular chain restaurant, closed dozens of its Californian restaurants in June. It then filed for bankruptcy just days later.

Fosters Freeze, a fast-food chain, has closed its Fresno outlet. The company directly blamed the wage hike for the closure. Other businesses have managed to stay open but have passed their increased costs onto the customers. Chipotle, Burger King, and Starbuck’s are all reported to have increased their prices by around 8% in their Californian locations.