Blaze Pizza joins other businesses leaving California for 'growth' elsewhere

(The Center Square) - Blaze Pizza is relocating its headquarters from California to Atlanta, a move that will reduce its state corporate tax rate by more than a third. Blaze said its relocation is driven by a desire for its “next wave of growth.” Georgia’s annualized GDP growth was 11.8% for April, while California’s grew at an annualized 3.8% based on the latest data from the end of 2023.

Founded in Southern California, Blaze has approximately ⅓ of its over 300 locations in California. In a statement, Blaze said its 7,500 restaurant-level employees would largely be unaffected by the move, and that a handful of non-remote corporate employees are being offered “relocation opportunities.”

Blaze’s relocation follows Rubio’s announcement it is closing 48 California stores, shedding an estimated 1,250 jobs, and a report from the Hoover Institution finding California lost nearly 10,000 more fast food jobs after the state’s $20 per hour fast food minimum wage law was signed into effect last fall.

Today, the California Business and Industrial Alliance ran a full-page advertisement in USA Today against the fast food minimum wage law with an obituary-style message on resulting business shutdowns. Some of the ad’s examples were from Blaze’s pizza competitors, including Mod Pizza, which is shutting down five of its California locations, Pizza Hut, which is laying off 1,200 delivery drivers, and Round Table Pizza, which laid off 73 drivers.

“You can only charge so much for a Big Mac,” said CABIA president Tom Manzo to The Center Square. “What business owners are doing is either they're selling, they're not expanding in California — they have expansion plans in different states — or they’re going out of business.

On its franchise website, Blaze lists California as a state where it has only “limited availability” as franchises while other states are tagged with “inquire today.”

“The biggest laugh was we’re going to give the healthcare workers a minimum wage of $25 per hour, and then they have this budget deficit, and then they’re like ‘We’re not sure if the government can afford that.’ Well, wait a minute, you can’t afford it, but business owners are supposed to?” continued Manzo.

Last year, California passed a $25 per hour healthcare minimum wage that would start phasing in at $23 per hour on June 1. Because the bill would cost the state $4 billion in its first year, and the state faces a $7 billion deficit, Newsom urged legislators to pass a bill delaying the wage’s adoption. Newsom signed the delay into law on May 31, at the last possible moment.

Small businesses are not directly subject to the fast food minimum wage, but face pressure to raise wages as they compete for the same pool of minimum wage employees.