Saturday, May 31, 2014

Fast food CEO: Minimum wage hikes closing locations

All those papers and studies that showed that it was inconclusive that raising the minimum wage would hard businesses?

They lied.
CKE Restaurants' roots began in California roughly seven decades ago, but you won't see the parent company of Carl's Jr. and Hardee's expanding there much anymore.

What's causing what company CEO Andy Puzder describes as "very little growth" in the state?

In part it's because "the minimum wage is so high so it's harder to come up with profitable business models," Puzder said in an interview. The state's minimum wage is set to rise to $9 in July, making it among the nation's highest, and $10 by January 2016.

In cities in other states where the minimum wage has gone up considerably, Puzder said "franchisees are closing locations" after riding out lease expirations.

If the federal minimum hourly pay shoots up to $10.10 from the current $7.25-as many lawmakers and President Barack Obama are advocating-Puzder predicts fewer entry-level jobs will be created. If this happens, CKE would also create fewer positions, he forecast.


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