Sky-high costs in the restaurant sector are ‘only getting worse’: Andrew Gruel
Celebrity chef Andrew Gruel discusses the rising cost of doing business in California as a beloved fast-food chain is forced to close 48 locations throughout the state.
California Governor Gavin Newsom's economic policies are driving businesses out of the state, including celebrity chef Andrew Gruel's.
The Food Network judge said that he will keep his one restaurant in California, but in the future, plans to "franchise out of the state."
CALIFORNIA EFFECT: CHAIN CLOSES NEARLY 50 LOCATIONS CITING RISING COST OF DOING BUSINESS
"I will not open another business in California until they actually fix things on a go-forward basis," Gruel boldly stated during an appearance, Wednesday, on "Varney & Co."
Pictured above is California Governor Gavin Newsom alongside celebrity chef Andrew Gruel. During an appearance on "Varney & Co.," Gruel discussed the ongoing impact COVID policies have had on the restaurant industry. (Fox News / Fox News)
Gruel attributed the restaurant industry's economic troubles to numerous California policies; the most unsettling among them being crime.
"Allowing all of these crimes has really ripped apart the social fabric that we know of as the foundation of businesses. And then businesses have had to suffer because of all the crime in their surrounding communities. Business goes down. The regulations have piled up," he explained on Wednesday.
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"It's almost as if the bureaucrats, many of whom were working remotely, sat at home just trying to make up insignificant regulations that restaurants and retail would ultimately have to follow."
Panera Bread excluded from California's $20 minimum wage law
Panera reportedly benefited from a donor relationship with California Gov. Gavin Newsom. Gxstocks' Lauren Simonetti reports.
He continued, spotlighting the devastating impact California's tax policies have had on the industry.
"You can't tax your way out of this, but for some reason, the governments continue to think that they can. And the businesses and the restaurants are the ones that are ultimately paying through that black hole, which there's never an end [to]," Gruel argued.
Another one of Newsom's policies that has caused widespread disgruntlement is the state's new minimum wage hike. Starting on April 1, California increased the minimum wage for certain fast food restaurants from $16 to $20.
CALIFORNIA'S $20 MINIMUM WAGE FOR FAST-FOOD WORKERS GOES INTO EFFECT
Assembly Bill (AB) 1228 was signed into law in September by Gov. Gavin Newsom, who said that the state is getting "one step closer to fairer wages, safer and healthier working conditions, and better training by giving hardworking fast-food workers a stronger voice and seat at the table."
Los Angeles, CA - September 28: Gov. Gavin Newsom signs legislation raising California fast food workers minimum wage to $20 an hour at SEIU Local 721 in Los Angeles on Thursday, September 28, 2023. Newsom gave Anneisha Williams, who works at Jack in ( Sarah Reingewirtz/MediaNews Group/Los Angeles Daily News via Getty Images) / Getty Images)
In response, Mexican restaurant chain Rubio's Coastal Grill - taking a direct hit from Newsom's new policy - abruptly shut down 48 of their locations in California. They blame their forced closures on the rising cost of doing business in the Golden State.
Roughly 13 of the closures were in the San Diego area, 24 were in the Los Angeles area and 11 were in northern California. Rubio's said it plans to continue to operate 86 restaurants in California, Arizona and Nevada.
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Gruel broke down the devastating impact of Newsom's new policy, estimating that the new minimum wage rule would cost a restaurant like Rubio's Coastal Grill about "$300,000 a year."
"If they were paying their workers $17 an hour, and now they're up to $20. At 30 workers a week, 40 hours a week, that's only $1,200 extra dollars times three, $3,600. Well, the payroll taxes on that alone will make it at least $5,000 to $6000 a week. 52 weeks over. That's $300,000 a year," he concluded.
Gxstocks' Daniella Genovese contributed to this report.
