When adversaries summon lawyers, a conflict can take an expensive turn. When they call in statisticians, as is happening right now in a war of words between California Gov. Gavin Newsom and the restaurant business, plenty more can be at stake.
The governor, a restaurateur himself, is apparently tired of hearing that the new wage-setting model his state created is devastating the fast-food business. His office issued a statement Wednesday that shows fast-food restaurants in California have actually stepped up their hiring since the minimum wage for quick-service workers was raised to $20 on April 1. Citing U.S. Bureau of Labor Statistics (BLS) data, the definitive source for labor stats, Newsom’s office noted that 10,600 workers have been added to the collective payrolls of fast-food restaurants in the state during April and May. So much for hurting employment, one of the warnings that was sounded by the business.
“Newsom is wrong – CA actually lost thousands of fast food jobs this year,” snapped back the Employment Policies Institute (EPI), a pro-industry group that’s part of Berman & Associates, the in-your-face Washington, D.C.-based lobbying force. In a statement issued Thursday morning, the EPI contended that Newsom was obscuring the truth by using seasonally unadjusted figures, or absolute numbers that reflect the upswings in hiring that usually come during the lead-in to summer and the year-end holidays. Those seasonal workers were on the books, distorting the picture, according to the research and lobbying group.
Yet its assertion is undercut by the seasonally adjusted figures from BLS. As EPI posted in its Thursday morning comeback, fast-food employment dropped by only 46 jobs in May, after rising by 56 positions in April. Those changes are off what Newsom’s office set as a base of 550,000 fast-food workers for whom the new $20 minimum wage applies.
The stats stated by EPI do show an elimination of 2,031 quick-service jobs in March. Arguably those positions were phased out in anticipation of the April 1 change in the pay floor. And June figures could also bring proof of attrition.
Or, maybe, a strong indication that the fast-food labor situation there is stabilizing.
The one certainty at present is that someone’s wrong. The situation proves once again that truth takes a beating when the politicking is ratcheted up.
Yet clarity is essential if the fast-food business wants a glimmer of what its future could truly be like. The union that negotiated the $20 minimum wage in California has made no pretense about the Golden State being the testing ground for a whole new way of setting wages for restaurant workers. Under a compromise brokered by Newsom, the state has shifted responsibility for setting fast-food pay from the legislature to a non-governmental body, the Fast Food Council, whose members include proxies for the workers themselves. The union—and allies like Newsom—would like to establish a similar model in other markets, if not all of them.
If the situation blows up, as the industry has warned, chances of duplicating the Fast Food Council would wane significantly. But if the new system should work, the business would clearly find itself on the defensive. Self-protection will be that much more difficult if the trade appears to be yelling wolf.
Indeed, either side can hurt itself with ham-handed politicking, thereby losing credibility in the eyes of the public. What’s really at stake in California is the sympathy of voters-slash-consumers, and they’re smart enough to see through blown smoke. And what truly happens there will determine if the California fast-food model is exported elsewhere.
Selective data mining helps no one in the long run. Besides, lawyers don’t want to lose billable hours to statisticians.