At least 16 fast-food restaurants have closed across the Fresno area since the start of 2025, and franchise owners point to the same culprit: California's $20-an-hour minimum wage for fast-food workers, a mandate that took effect in April 2024 and has been grinding down operators who already run on razor-thin margins.
The closures stretch from downtown Fresno to Clovis, Hanford, Merced, Kerman, and Visalia, a rolling wave of locked doors and darkened drive-throughs that spans some of the best-known chains in the country. KFC alone has shut six locations. Carl's Jr. closed three. Five Guys, Wendy's, Popeyes Louisiana Kitchen, and Jack in the Box have each pulled out of at least one site.
The damage is not abstract. These are storefronts that employed local workers, served working families, and paid local taxes. Now they sit empty, monuments to a policy that Sacramento's leaders sold as a win for workers but that, by every available measure, is shrinking the very industry it claimed to help.
Assembly Bill 1228, signed by Governor Gavin Newsom, set a $20-per-hour minimum wage for employees of fast-food chains with at least 60 locations nationwide. The California Legislature approved the measure, not voters. It took effect April 1, 2024, leapfrogging the state's general minimum wage of $16.90 an hour by more than three dollars.
The gap matters. A franchise operator running a burger joint under a national brand now pays substantially more per hour than the sandwich shop or taqueria next door. The cost difference does not buy better equipment, faster service, or cheaper beef. It simply raises the floor beneath one class of restaurant while leaving its competitors untouched.
Jot Condie, CEO of the California Restaurant Association, told the Fresno Bee that the wage has become one of the most "devastating" financial burdens facing qualifying operators. He did not mince words about the math:
"In the industry that has roughly a 1 to 3% profit margin on average in California, there's no room for error."
One to three percent. That is the margin a franchise owner works with before a single cost increase, in labor, food, energy, or insurance, tips the ledger from black to red.
The closures are not clustered in one unlucky strip mall. They span California's Central Valley, hitting communities that can least afford to lose employers and tax revenue.
KFC's retreat has been the most dramatic. Six restaurants from downtown Fresno to Clovis shut their doors beginning in 2025, including a "next-gen" location in northwest Fresno, a store presumably built to showcase the brand's future, now abandoned. The chain also closed its Kerman restaurant earlier this year.
Carl's Jr. closed its McKinley Avenue location near Winery Avenue in Fresno in February. Its First Street and Shaw Avenue store followed on June 27. A third Central Valley location, on Chinowth Street near Highway 198 in Visalia, also went dark.
Five Guys shuttered its Merced restaurant on June 26 and its Hanford location on July 4, Independence Day, of all dates, for a business that could no longer afford to stay independent.
Popeyes Louisiana Kitchen closed its First Street and McKinley Avenue spot in Fresno in the spring. Wendy's exited both its downtown Fresno restaurant and its West Shaw Avenue location. Jack in the Box recently closed at Cedar and Nees avenues.
Add them up and the picture is stark: nationally recognized brands, operating in a mid-size California metro, deciding one after another that the numbers no longer work.
The $20 wage did not land in isolation. Condie described an industry facing pressure from every direction at once.
"Almost 80% are expecting costs across the board to go up, energy costs, insurance costs, labor costs, food costs."
He added a blunt assessment of how operators explain their decisions to close:
"When you talk to restaurant operators who have closed locations, they will always cite that."
"That" is the $20 wage. Not the only factor, but the one operators name first, the one imposed by Sacramento, and the one they had no power to negotiate.
The squeeze is straightforward. A franchise owner facing higher labor costs can raise menu prices, cut staff, reduce hours, or close. In a region like the Central Valley, where household incomes trail the coastal metros, customers have less room to absorb price hikes. Fewer customers mean less revenue. Less revenue on higher costs means the math breaks.
AB 1228 did more than raise wages. It also created the California Fast Food Council, a state body charged with overseeing the industry. The council operates on a $1.1 million taxpayer-funded budget.
It has not held a full meeting in months.
The last gathering of any kind was a minor subcommittee hearing in February 2025. In May, the council's chair, Nick Hardeman, resigned after Newsom appointed him to a separate state housing board. The governor has not named a replacement. State law requires the council to meet at least once every six months, but state officials acknowledge it cannot legally convene without a chair.
So the body Sacramento created to monitor the fast-food industry sits idle, burning through public money, while the industry it was supposed to watch over sheds locations across the Central Valley. The governor pulled its leader away for another assignment and never bothered to fill the seat.
That is not oversight. It is abandonment dressed up as governance.
The people hurt most by these closures are not Sacramento legislators or Silicon Valley executives. They are the line cooks, cashiers, and shift managers in Fresno and Merced who showed up for work one day and found the doors locked. They are the franchise owners who invested their savings in a business model that California's government made untenable. They are the customers in working-class neighborhoods who lost a convenient, affordable meal option.
The $20 wage was marketed as a raise. For the workers who kept their jobs at surviving locations, it may be exactly that, for now. But for the workers at 16 shuttered restaurants, the raise is worth zero. A higher minimum wage means nothing when the job no longer exists.
Governor Newsom has not publicly addressed the Fresno-area closures. He has not explained why the Fast Food Council he championed cannot convene. He signed the bill, took the credit, and moved on.
California's political class treats minimum-wage increases as cost-free moral victories. Raise the number, hold a press conference, move to the next issue. The assumption is that businesses will absorb the cost because they have no choice.
But businesses always have a choice. They can leave. And in the Central Valley, they are leaving.
Sixteen closures in one metro area in roughly six months is not a statistical blip. It is a pattern, one that confirms what critics of AB 1228 warned about before the ink was dry. When you force wages above what the local market can support, you do not lift workers up. You eliminate the jobs they depend on.
Condie's numbers tell the story plainly. An industry averaging one-to-three-percent profit margins cannot absorb a wage floor that leaps past the statewide minimum by more than three dollars an hour, not when energy, insurance, and food costs are climbing at the same time. Something has to give. In Fresno, what gave was the restaurants themselves.
The Fast Food Council's paralysis deserves its own scrutiny. A $1.1 million annual budget, funded by taxpayers, sustains an agency that has done essentially nothing since February. Its chair left for a different board appointment. No replacement has been named. The law says the council must meet every six months, yet it cannot legally do so.
If a private company spent $1.1 million on a department that produced no work for half a year, shareholders would demand answers. Taxpayers deserve the same.
The council's dysfunction is a mirror of the broader policy failure. Sacramento mandated a wage, created a bureaucracy, funded it generously, and then walked away. The wage is doing damage. The bureaucracy is doing nothing. And the governor's office has offered no public explanation for either.
The 16 closures reported so far may not be the end. Condie's survey figure, nearly 80 percent of operators expecting costs to keep rising, suggests more franchise owners are running the same grim arithmetic that already pushed their competitors out. If energy and insurance costs continue climbing, and if consumer spending in the Central Valley stays flat, additional closures are a matter of when, not if.
Every vacant fast-food building is a visible reminder that policy has consequences. The workers who lost their jobs know it. The franchise owners who lost their investments know it. The neighborhoods left with fewer options and fewer employers know it.
Sacramento may be the last to figure it out, if it bothers to look at all.
You can mandate a wage. You cannot mandate a customer willing to pay for it, or a business willing to lose money honoring it. Fresno's empty drive-throughs are proof enough of that.
