Spring 2024
- California Raises its Minimum Wage to $20 an hour
Written by: Gianna Zheng (4/4/2024)
In an effort to improve the living standards of fast-food workers, California Gov. Gavin Newsom signed
into law a bill that would increase the minimum wage at fast-food places from $16 to $20. Effective as of
April 1st, 2024, this move has sparked widespread discussion of whether its impacts are more harmful than beneficial.
The legislation specifically outlines that chains with 60 locations nationally will be subject to this increase, however numerous smaller businesses have expressed concerns. Due to dominant chains paying $20, small businesses will face pressure to match the $20 wage in order to stay competitive, resulting in many owners worrying they will have to close operations. This $4 hike will be a significant increase, abandoning the trend of around $1 annual increases over the past decade. Anticipating the impact, restaurants took preemptive measures, such as reducing hours, laying off staff, and turning to automation prior to the bill’s implementation. Moreover, to offset the increased labor costs, many places have opted to raise menu prices, with adjustments ranging from 6% to 10%.
Despite most places increasing prices, some establishments, such as Cava, a Mediterranean-restaurant
chain, have opted to absorb the losses and keep menu prices as is. In-N-Out, a burger chain, had its
minimum wage set at $20 as of at least a year ago, meaning it will likely be able to maintain similar menu prices despite the implementation of the new bill.
As a result of this wage increase, numerous consumers have gone on social media to express their support and frustration with the bill. Advocates point out how the wage increase can serve as a catalyst for better wages across other low-paying industries. However, widespread backlash is evident, with opponents highlighting significant job losses, reduced hours, and higher prices as immediate consequences.
Sources:
https://fred.stlouisfed.org/series/STTMINWGCA
https://www.nytimes.com/2024/03/28/business/economy/fast-food-minimum-wage-california.html
- A Good Week for Stocks
Written by: Gianna Zheng (2/23/2024)
The performance of the S&P 500 this week was at an all-time high, rising 3%. This increase was caused primarily by the technology sector, with Nvidia Corporation (NVDA) standing out as a key player. Nvidia’s release of its revenue reports for the last quarter of 2023 resulted in a 16% rise in its shares and served as the main catalyst. These figures exceeded many analysts’ predictions and triggered a stock rally while securing Nvidia’s spot as the top-performing stock within the S&P 500. This momentum created a ripple effect within similar companies. For example, two chip-making companies, Advanced Micro Devices, and Applied Materials rose 11% and 5% respectively.
Other major U.S. stock indices showed mixed results. For instance, the Dow Jones Industrial Average experienced similar upticks ending with a modest 0.2% rise. Interestingly, the Nasdaq Composite, an index weighted heavily in technology ended the week down 0.3%. Despite this week’s Wall Street stock rally, the loom of a recession is still in the air with the Federal Reserve keeping a close eye on inflation waiting for the right time to start cutting interest rates.
Internationally, Japan’s main stock index, the Nikkei 225, also experienced a bullish trend, reaching its record-breaking high. This milestone is particularly significant as it marks the Japanese stock market finally returning to levels before Japan’s recession in 1989. The rise of the Nikkei 225 drew great optimism among both Japanese investors and residents given that it reflects the long-awaited recovery of Japan’s economy and a resurgence in global market confidence.
Sources:
https://www.reuters.com/markets/asia/nikkei-parties-like-its-1989-scales-record-high-2024-02-22/
https://www.cnbc.com/2024/02/22/stock-market-today-live-updates.html
https://www.nytimes.com/2024/02/22/business/stock-market-today.html?searchResultPosition=1
