Beloved Mexican restaurant becomes the latest to shut its doors in California – after iconic chain closed 48 restaurants over the state’s $20 minimum wage

A popular Mexican restaurant is closing its doors for good Californiabecoming the latest business to close following the state’s minimum wage increase.

Launched in 2015, Salud Tacos is a staple in San Diego, serving satisfied customers with authentic Latin American cuisine for nearly a decade.

The owner of the renowned Mexican restaurant has identified several factors that contributed to the demise of their business: including problems with their leases and minimum wage increases.

On Salud Tacos Instagram page, they discussed their inability to secure a new lease for their eatery.

“This may be one of the hardest things I have ever had to express publicly,” the owner said in a statement.

Launched in 2015, Salud Tacos is a San Diego staple, serving satisfied customers with authentic Latin American cuisine for nearly a decade

Under Governor Gavin Newsom, California has passed a controversial new law requiring fast-foot restaurants to raise their minimum wage from $16 to $20 per hour effective April 1.

“This past year our lease in Barrio Logan came to an agreement, and we have attempted to negotiate a new lease for the same space, but nothing has materialized over the past year.”

They continued, “Not being able to secure what we needed, along with other setbacks beyond anyone’s control, forced me to realize that maybe things happen for a reason and are just meant to be that way.”

The owner concluded: ‘After many sleepless nights, after struggling with many thoughts and emotions, and after much reflection, I have decided to close our doors to Salud as we know it.’

La Bamba, a popular bar associated with Salud, is also closing.

The disappearance of Salud Tacos, dubbed “the king of all tacos” by exuberant locals, has left a hole in the community.

Under Governor Gavin Newsom, California has passed a controversial new law The fast food restaurants required their minimum wage from 16 to 20 dollars per hour from April 1.

The increase in the minimum wage has done just that has contributed to an economic slump that is plaguing many California restaurants.

Since Newsom introduced the $20 an hour wage, there has been a wave of closures, with one restaurant after another going out of business.

On Salud Tacos’ Instagram page, they discussed their inability to secure a new lease for their eatery

La Bamba, a popular bar associated with Salud, is also closing

Jonathan Maze, editor-in-chief of Restaurant Business, said he is not surprised by this outcome.

“This is a tough environment for restaurants right now. We’ll probably continue to see more of this,” Maze shared CBS8.

The food industry said the problem wasn’t just about the size of the wage increase, but also about how Newsom introduced it to the state.

‘It’s not just a pay increase. It’s the speed of it. It rose 25 percent basically overnight.

Maze noted, “The effect of this is significant.” Significant’ may be an understatement.

Since the minimum wage law came into effect, an estimated 10,000 jobs have been cut at fast-food chains such as Pizza Hut and Burger King as companies struggle to adapt to higher wages.

Since Newsom’s introduction of the $20 per hour wage, there has been a wave of closures, with one restaurant after another going out of business

This week, Rubio’s Coastal Grill, a beloved Mexican restaurant chain, filed for bankruptcy

Rubio’s Coastal Grill announced it would close 48 restaurants in the state (Photo: The grand opening of the third Rubio’s location in the Pacific Beach neighborhood of San Diego, California in 1986)

But not all companies are able to adapt. This week, Rubio’s Coastal Grill, a beloved Mexican restaurant chain, filed for bankruptcy. Across the state, Rubio’s has closed 48 locations.

The California Business and Industrial Alliance (CABIA) blasted Governor Gavin Newsom for pushing through the law, which also meant businesses in the state would have to raise prices.

To highlight the law’s impact, the trade group took out an ad in the USA Today edition Thursday featuring fake “obituaries” of popular brands.

The tongue-in-cheek ad, titled “In Memoriam: Victims of Newsom’s minimum wage,” highlighted the issues facing smaller brands, including Rubio’s, and fast-food giants, including Pizza Hut, Burger King, Subway and McDonald’s.

It contains news clips documenting the changes companies have made in response to the wage increase.

California Governor Gavin Newsom signed the fast food bill into law on September 28, 2023, surrounded by workers from SEIU Local 721 in Los Angeles

This includes raising prices, letting go of workers to reduce labor costs – and in some cases closing locations.

The law that Newsom signed last September raises the minimum wage for fast food workers to $20 an hour at chains with more than 60 locations in the US.

That’s 25 percent more than California’s standard minimum wage of $16 an hour, which itself went into effect in January.

At the national level, Congress hasn’t touched the minimum wage in decades; it is still $7.25 per hour. Instead, so-called “wage wars” are playing out at the state level.

“California businesses have been targeted and targeted for years,” CABIA President and Founder Tom Manzo told Fox Business.

“It’s just another law that further puts businesses at risk.”

He said civil servants are living in a “fantasy land” if they think drastic pay increases will actually help workers or businesses.

“You can only raise prices so much,” Manzo told the outlet. ‘And you see it. People aren’t going to pay $20 for a Big Mac. It’s not going to happen.’