Rick Rosenfield, co-founder of California Pizza Kitchen, expressed concerns about the current business climate in California, stating that if he were to start over, he would choose Florida instead. He noted that California's environment has become less business-friendly compared to when he launched the restaurant chain over 40 years ago. Rosenfield cited factors such as labor shortages, increased regulations, and rising costs, including a new minimum wage law set to take effect in April 2024, which mandates that fast-food employees be paid at least $20 per hour. He indicated that while the restaurant typically pays above the minimum wage, such increases create a ripple effect, leading to higher overall labor costs.
Rosenfield highlighted that many businesses operate on thin margins, with the National Restaurant Association reporting that food and labor costs account for about 33% of restaurant sales, while other expenses make up approximately 29%. He warned that businesses often pass increased costs onto customers, which can harm affordability.
Rosenfield also pointed out that several major companies have relocated from California to states like Texas, where a more favorable business climate is reported. He noted that Florida has seen significant growth in new business filings, with over 561,000 new LLCs established in 2025 alone. In response to Rosenfield's comments, California Governor Gavin Newsom's office acknowledged the state's pride in hosting California Pizza Kitchen and emphasized its status as an economic powerhouse, despite the challenges mentioned by Rosenfield. He concluded by expressing hope that California would become more welcoming to businesses in the future.