Impact of AB 1228 on Full Service Restaurants in Fresno County
Background
In our last blog post, we explored the impact of AB 1228 on limited service restaurants in Fresno County, to see how our region stacked up against the statewide and nationwide effects of this mandate. While AB 1228 raised the minimum wage an astonishing 25% for employees of fast food establishments, employees of full service, sit-down restaurants remain subject to the state’s default minimum wage of $16.50, which was $16.00 when this law first went into effect. However, because these industries share a similar labor pool, it is highly likely that full service restaurants have been impacted by this law as well. Why work as a dishwasher or line cook at a casual dining establishment for $16.50/hour when you could go serve up McFries or McNugs at your local Mickey D’s for $20/hour? Obviously, this decision isn’t as straightforward as it seems, which we will explore later. But first, we need to dive into the data and see if any substantial effect can be observed on employment, average wages, and other metrics. We will be following the same methodology that was applied in our last analysis of limited service restaurants. Please refer to that blog post for more details.
Employment
Between September 2023 and September 2024, Fresno County lost 217 jobs in its full service restaurant sector, representing a 2.17% decrease in industry employment. By comparison, the State of California lost 12,024 jobs or 1.95% of its restaurant workforce over the same time period. The impact this had on the U.S. economy was minimal, but noticeable, decreasing overall restaurant employment by 0.17% year-over-year, which translated into 9,313 jobs lost. Gains were made in other states that helped offset the total decline.
Prior to the enactment of AB 1228, the full service restaurants industry was already struggling in Fresno County, with employment contracting by 0.75% between September 2022 and September 2023. At the state level however, restaurant employment increased by 1.26% during the same period, lagging behind the nationwide growth rate of 2.94%. The year before that, Fresno County faired much better with 3.07% growth in its restaurant sector between September 2021 and September 2022, but was still outperformed by the statewide and nationwide growth rates of 7.91% and 6.41%, respectively. Much of this accelerated growth between 2021 and 2023 can be attributed to covid-era restrictions ending. The statewide economy fully reopened on June 15th, 2021 which allowed for indoor dining at restaurants again. During this two-year period, over 52,000 full service restaurant jobs were added statewide, with 234 of these added in Fresno County. At the national level, nearly 465,000 jobs were added for full service restaurants.
In percentage terms, the share of these new jobs that were erased in the subsequent year was 23.0% at the state level, 92.7% in Fresno County, and 2.0% nationwide. Clearly, Fresno County faired 4x times worse than the state overall, despite being subject to the same mandate. This suggests that AB 1228 had an outsized impact on full service restaurants in Fresno County, compared to the rest of the state. This is a sharp contrast to our previous findings. As uncovered in our last blog post, Fresno County faired 4x times better in fast food employment compared to the statewide aggregate. Perhaps our fast food industry is more resilient than our full service restaurant industry?
Quarterly Averages
To remain consistent with the format of my previous blog post, I will again be providing the same analysis for the Q4 quarterly average data. This data is slightly more recent and also helps smooth out any monthly fluctuations. Between Q4 2023 and Q4 2024, Fresno County lost 193 jobs in its full service restaurants sector, representing a 1.85% decrease in industry employment. By contrast, the state of California lost 9,608 jobs or 1.57% of its restaurant workforce over the same time period. The impact on the U.S. economy was more significant, decreasing overall restaurant employment by 0.37% year-over-year, which translated into 19,650 jobs lost. This more recent quarterly data paints a slightly different picture across the board, with both Fresno County and the statewide aggregate shrinking their job losses. Combined with a steeper decline nationwide, this suggests that job losses in the full service sector may have been partly attributed to a broader national trend, and not just the collateral impact of AB 1228.
Employment gains in prior years were smaller than their monthly counterparts, with the exception of one observation — between Q4 2022 and Q4 2023, full service restaurant jobs increased by 0.20% in Fresno County. In the year before, the industry saw virtually no change at 0.03%. Despite this change, Fresno County experienced an overall decline in restaurant employment of 1.63% during the three years between Q4 2021 and Q4 2024, resulting in 169 jobs lost. By contrast, both the state of California and United States saw a net gain in restaurant employment during this three-year period, even with job losses recorded in the most recent year. The state ultimately gained 4.20%, adding over 24,000 jobs to its restaurant sector, while nationwide, nearly 357,000 jobs were added, representing a 7.23% increase in restaurant employment. As per usual, consolidated datasets will be available on our Explore Data page in the coming weeks.
Establishments
It is difficult to observe a clear trend in the number of full service restaurant establishments throughout the last three years. In the most recent observation year, Fresno County gained 2 restaurant establishments, while 235 were lost statewide. However, in the two years prior, Fresno County had lost 24 establishments while California overall gained 310. So ultimately, we saw a net gain of 75 establishments statewide, and a net loss of 22 in Fresno County. Full service restaurants in our region were already struggling prior to the enactment of AB 1228, and there is no evidence to suggest that this mandate resulted in any closures. This was not the case statewide however, where the upward momentum of new restaurants opening was abruptly stunted. Looking at the graphs for each, seasonal fluctuations become evident. The first quarter of each year is always characterized by a sharp decline in restaurant establishments. This is why only comparing year-over-year is crucial.
In the three years between Q4 2021 and Q4 2024, the U.S. gained over 11,000 new restaurant establishments, recording a 4.41% increase. The most recent year saw the fewest additions to the restaurant pool, perhaps indicating a winding down of the post-covid investment boom. Seasonal downturns are evident at the national level as well, but notably Q1 2024 saw the sharpest decline in comparison with the prior years’ first quarters.
Disclaimer: This blog post is an unfinished draft, last modified on August 14th, 2025. I have decided to publish the research I had conducted thus far for the benefit of my readers. Rather than attempting to finish this draft, I will be updating my analysis to include more recently available data, and share those findings in a new blog post.