Process
Status Items Output None Questions None Claims None Highlights Done See section below
Highlights
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Business groups and Republican politicians have argued for decades that minimum-wage increases harm the very workers they are supposed to help, and this one—passed in September 2023 and setting a salary floor of $20 an hour for fast-food workers—appeared to be no different. Headlines such as “California Restaurants Cut Jobs as Fast-Food Wages Set to Rise” and “California’s Minimum Wage Woes Are a Cautionary Tale for the Nation” proliferated.
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Except it hasn’t. In the six months after California’s new minimum wage came into effect in April, the state’s fast-food sector actually gained jobs. If anything, it proves that the minimum wage can be raised even higher than experts previously believed without hurting employment. That should be good news.
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the policy has been portrayed as a catastrophic failure. That is a testament to how quickly economic misinformation spreads—and how hard it is to combat once it does.
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when the minimum wage goes up, low-wage jobs suddenly become more attractive to workers, who respond by staying in those jobs longer. Less turnover means that companies have to spend less time recruiting and training new hires, and that the workers themselves are more productive and less prone to rookie mistakes—all of which lowers an employer’s labor costs.
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In June, the California Business and Industrial Alliance took out a full-page ad in USA Today declaring that the state’s fast-food businesses had shed nearly 10,000 jobs in anticipation of the new law. Similar claims began appearing in right-wing media, local newspapers, and the national business press, blaming the new minimum-wage law for mass layoffs and restaurant closures. That narrative, however, was based on a statistical illusion. The 10,000-jobs number originated in an article by the Hoover Institution, a free-market-oriented think tank, which analyzed raw employment data from September 2023 through the end of the year. But as the anonymous blogger Invictus and the Los Angeles Times columnist Michael Hiltzik have pointed out, the fast-food industry always sheds jobs during the fall and winter months, simply because people go out to eat less. (It then gains those jobs back during spring and summer, when demand recovers.) According to “seasonally adjusted” employment numbers, which are widely considered more reliable because they account for these regular ups and downs, California’s fast-food industry gained more than 5,000 jobs during the period in question.
✏️ Attempt #1 at cherry picking stats to make a point. 🔗 View Highlight
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In September 2024, an industry press release cited new numbers, this time seasonally adjusted, appearing to show that the state’s fast-food sector had lost thousands of jobs since the beginning of the year because of the new minimum wage, while the neighboring states of Oregon and Nevada had gained jobs. This resulted in a second wave of negative press. Once again, the statistics were misleading. This time they came from the Employment Policies Institute, a nonprofit with deep ties to restaurant industry lobbyists. The analysis conveniently chose January 2024 as its date to begin measuring employment, which happened to be one of the few starting points that showed subsequent job losses; choosing a start date of either September 2023 (when the law was signed) or April 2024 (when it took effect) would have shown that the number of jobs had risen. Simply comparing each month’s job growth with the same month the previous year, which avoids the problem of picking a start date, reveals that California’s fast-food sector gained jobs in all but one month since September 2023.
✏️ Attempt #2 at trying to use cherry-picked stats to make one’s point. 🔗 View Highlight
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In November, California voters narrowly rejected a ballot measure that would have raised the state’s minimum wage for all industries to $18 an hour, following a massive industry-led campaign centered on the claim that the state’s fast-food minimum-wage experiment had been a disaster.
✏️ Propaganda and lies worked, even in the face of actual success. 🔗 View Highlight