How Much Can a McDonald's Employee Actually Make in California After the $20 Wage Hike?

When California enacted its $20 per hour minimum wage for fast-food workers in April 2024, it sparked intense debate about whether restaurants could survive the policy. A year and a half later, data tells a more nuanced story—one that directly impacts how much a McDonald’s employee makes a year and what that means for their financial stability.

The Math: From $12 to $20 Hourly

For workers like Zane Marte, who spent seven years at Jack in the Box in the San Jose area, the wage floor meant substantial improvement. He started at $12 per hour and gradually worked his way up through raises and promotion to management. When the $20 mandate took effect, his hourly rate finally reached that threshold—translating to roughly $41,600 annually for full-time work (assuming 40 hours per week).

Research from UC Berkeley’s Center on Wage and Employment Dynamics found that the average pre-policy wage for California fast-food workers was $17.13 per hour. The new $20 minimum represents approximately a 17% pay increase for the typical worker. For someone working full-time throughout the year, this could mean an additional $5,800 to $7,000 annually compared to the old wage structure.

Real Workers, Real Impact

The increased compensation has made tangible differences. Marte noted that the raise allowed him to support his family more effectively and purchase his own groceries rather than relying on parents. For Julia Gonzalez, 21, working at multiple fast-food locations in Los Angeles, the higher wages enabled her to save money despite receiving fewer scheduled hours.

However, reduced scheduling has become a common tradeoff. Operators have trimmed labor hours in response to rising costs, meaning some workers now earn close to the theoretical maximum while others experience less consistent income due to abbreviated shifts. This creates variation in actual annual earnings—some employees might reach $40,000+ while others fall short depending on their scheduled hours.

The Operator’s Side of the Story

Restaurant franchisees faced genuine pressure. Harshraj Ghai, operating over 200 Burger King, Taco Bell, and Popeyes locations across California and Oregon, implemented 10-12% menu price increases but found it insufficient to offset labor costs. He’s subsequently closed approximately 10 California locations over 18 months, with plans to shutter another dozen within two years. His Oregon locations, where this wage floor doesn’t apply, remain “significantly more profitable.”

Despite these challenges, the feared industry collapse hasn’t materialized. California added nearly 2,300 fast-food restaurant locations between Q1 2024 and Q1 2025—a 5% growth rate exceeding the national average of 2%. Widespread closures haven’t occurred, though individual operators report difficult circumstances.

The Spillover Question

Critics initially worried that non-fast-food restaurants would need to raise their own wages to compete for workers. Berkeley researchers found no evidence of wage spillover into full-service restaurant chains like Denny’s, Applebee’s, or Outback Steakhouse. The University of Kentucky study similarly found no widespread wage increases among other low-wage employers, suggesting the fast-food sector’s higher compensation didn’t trigger broader labor market disruptions.

What About Job Losses?

Data on employment remains contested. The Employment Policies Institute identified roughly 16,000 fast-food job losses since the law took effect. However, UC Berkeley researchers using seasonally-adjusted data reported no significant job losses, attributing this partly to California’s climate moderating seasonal employment fluctuations.

One consistent finding: turnover declined substantially. University of Kentucky research showed that while hiring slowed initially, workers’ retention improved markedly. For an industry historically plagued by expensive turnover and constant retraining, this represents meaningful operational benefit.

The Bottom Line on McDonald’s Employee Earnings

A McDonald’s employee in California now makes $20 per hour—equivalent to approximately $41,600 annually for full-time work, up from the previous $16 statewide minimum that would have yielded roughly $33,280 yearly. This represents real wage advancement for front-line workers, though actual earnings vary based on scheduling, with some experiencing reduced hours offsetting the percentage gains.

The policy remains controversial among operators facing thin margins and rising costs, yet hasn’t produced the catastrophic outcomes both sides initially predicted. Workers have more secure employment and better compensation; restaurants continue operating and even expanding, albeit with greater operational discipline required.