No, California’s wage bump for fast food workers isn’t doomsday for restaurants. Here’s why

Today, the minimum wage for California fast food workers will increase to $20 an hour, or 25% above the state’s $16 level. And a first-of-its-kind fast food council will give workers, employers and state government the opportunity to come together and set standards for the industry.

But rather than celebrating, many headlines are predicting mass layoffs, major burger price increases and even the end of fast food as we know it in California.

These headlines reflect an unsophisticated understanding of an outmoded and simplistic theory: In Econ 101, if you increase the price of labor, employers will use less of it or pass along the higher costs to consumers.