Thirteen Rubio’s Coastal Grill locations in California are closing this week after the cost of living in California continues to soar.
“The closings were brought about by the rising cost of doing business in California. While painful, the store closures are a necessary step in our strategic long-term plan to position Rubio’s for success for years to come,” a spokesperson for Rubio’s said.
The restaurant chain said they would keep 86 locations open throughout California, Arizona and Nevada.
The move comes after California raised its minimum wage to $20 for fast food workers in April 2024.
The law, passed by Democrats in the state Legislature last year, is part of an effort to support adults working in the fast food industry.
Many franchise owners in the state have stressed the impact the law is having on them, especially during a time of record high inflation.
“I try to do right by my employees. I pay them as much as I can. But this law is really hitting our operations hard,” Alex Johnson, owner of 10 Auntie Anne’s Pretzels and Cinnabon restaurants in the San Francisco Bay Area, said.
Johnson said sales have slowed in 2024, forcing him to lay off his office staff and rely on his parents to help with payroll and human resources.
Increasing his employees’ wages will cost the franchise owner about $470,000 each year, causing him to raise prices anywhere from 5% to 15% at his stores.
