There are more than 200,000 fast food restaurants across the United States. For decades, Americans have favorited these establishments because of their tasty, fast, and affordable options, but now, that’s all changing.
Fast food prices, including those at Subway, have increased significantly over the years. But with the new minimum wage law in California, costs are skyrocketing, and many Americans have decided these restaurants simply aren’t worth it anymore.
Prices at Subway
Before diving into the newest price tags at Subway, it’s essential to understand how much a sandwich at the famous fast food chain previously cost.
Costs can change between locations and specifically in each state; however, in the 1990s, most Subway sandwiches were priced between $2.49 and $3.99. By the end of the 2000s, prices jumped to $6.99 or even $8.99.
The Genius of the $5 Footlong
But in 2008, Subway came up with one of the most successful marketing campaigns of all time: The $5 footlong. At almost every Subway location in the country, customers could purchase a 12” sub of their choice for only $5, and sales skyrocketed.
In fact, some locations saw sales increase anywhere from 35% to 50%, and others experienced more than 50% growth with the promotion.
Subway Stopped the $5 Footlongs in 2019
Ten years later, the fast food chain decided to end the iconic offer; they reported that due to the increased cost of ingredients, they simply couldn’t afford to offer their sandwiches at such a low price point.
And over the past five years, the prices at the beloved sandwich shop have slowly but surely climbed higher than ever before. Now, a 12” sub can cost anywhere from $8.49 to $10.49, with some specialty sandwiches costing even more.
One Woman Just Paid $21 for Her Subway
About six months ago, a Reddit user posted that they “bought a Subway Sandwich for 21 bucks,” and the post has since gone viral.
Hundreds of Reddit users commented on the post, most of whom were absolutely outraged by the cost of a fast food sandwich. Others offered options for coupons and discounts from the Subway app, and still, some simply reported that Subway is now a waste of money.
The Reddit User Opted for a Specialty Sandwich
Several users commented that the poster likely opted for one of the restaurant’s specialty sandwiches. They said that a “build your own” footlong with only one protein only costs about $12 these days.
However, the general consensus was that, no matter how “special” the sandwich, a fast food meal that feeds just one person should never be more than $20.
Subway Isn’t the Only Fast Food Chain Under Fire
While Subway is certainly in the hot seat, it’s not the only fast food chain making headlines for its increased prices.
McDonald’s has also raised its prices, and at some locations, a Big Mac Meal now costs an almost unbelievable $18. People are outraged that a bacon cheeseburger meal at Five Guys now costs $24, and Chipotle has announced that several of its burrito bowls will now cost more than $12.
Why Are Fast Food Prices Increasing?
Of course, there are many factors that influence the cost of a fast food meal. The most significant component is inflation, which includes the growing cost of ingredients, rental prices for restaurants, and other operational rates.
But many argue that the most potent factor in the increased costs at fast food chains is the ever-growing expense of labor. Specifically, the raising of the minimum wage.
Gavin Newsom’s Newest Law Is to Blame
Many Americans are arguing that California Governor Gavin Newsom is directly to blame for the outrageous price tags at their favorite fast food restaurants.
Last year, the governor passed a new legislation that increased the minimum wage for fast food workers in California by 25% from $16 to $20. And since the law went into effect on April 1, 2024, several fast food corporations have responded by announcing price increases.
The Increased Cost of Labor is Significant
It’s important to understand that such a substantial increase in the hourly rate for minimum wage workers throughout the Golden State will unquestionably affect the labor costs of these corporations.
Companies such as McDonald’s, Chipotle, Domino’s, and Subway already pay billions of dollars in wages every year. McDonald’s reportedly spent $13.8 billion in 2023 on labor and Chipotle reported $2.44 billion that year. So a 25% increase, even just in their California locations, will be significant.
Others Argue That These Giant Companies Are Already Making Enough
But many Americans argue that these companies are using Gov. Newsom’s law to increase prices across California and the country, even though they really don’t have to.
McDonald’s, for example, reported a net income of $7.5 billion in 2021 and $8.46 billion in 2023. That’s a significant increase by anyone’s margin, so the question is: Why do fast food chains say they “have to” raise costs when minimum wage increases?
Americans Can No Longer Afford Fast Food
Sadly, it’s not the executives who will suffer from the increase in the minimum wage in California, it’s the American people. As prices skyrocket across the industry, many Americans say they simply cannot afford fast food anymore.
There will certainly be many Americans who refuse to purchase a Subway sandwich or a Big Mac for $20, but whether or not those losses in sales will be enough to affect the actual profit margins of these enormous companies is yet to be seen.
