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Five Guys is closing 4 California locations between late May and early July. The popular burger chain cited financial hardship as the reason. A total of 55 employees will lose their jobs across the affected stores.
🔥 Quick Facts
- Closing Dates: May 25 to July 2, 2026 across four California locations
- Job Losses: Exactly 55 employees will be laid off from the shuttered restaurants
- Affected Cities: Whittier, City of Industry, Merced, and Hanford
- Stated Reason: Financial hardship amid rising labor costs and commercial rent increases
The Four Locations Closing Their Doors
Five Guys confirmed permanent closures at four restaurants spanning multiple California regions. In the Los Angeles County area, two stores will close, one in Whittier on May 25 and another in City of Industry on May 26. Meanwhile, the Merced location shuts down June 26, and the Hanford restaurant closes July 2. According to state filing documents, the restaurant chain must notify affected workers under labor regulations.
The Whittier store stands to lose 13 employees, while City of Industry will see 15 workers laid off. The Merced location will cut 13 positions, and Hanford will eliminate 14 jobs. These closures mark a significant retreat from California for the burger franchise.
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Rising Labor and Real Estate Costs Squeeze Operations
Five Guys operates in an increasingly expensive California market. The state imposed a $20 per hour minimum wage for fast food workers in 2024, the highest in America. Combined with surging commercial real estate prices and declining foot traffic in some regions, profit margins have compressed significantly. Restaurant industry analysts report that many chains struggle with this cost structure.
The burger chain isn’t alone in this struggle. California has seen multiple restaurant closures this year as operators reassess their financial viability. Five Guys operates over 100 locations statewide, but these four closures highlight where profitability has deteriorated most. The company chose to exit rather than attempt operational turnarounds at these specific sites.
Comparison of Closure Details and Employee Impact
| Location | Closure Date | Jobs Lost | Region |
| Whittier | May 25, 2026 | 13 | Los Angeles County |
| City of Industry | May 26, 2026 | 15 | Los Angeles County |
| Merced | June 26, 2026 | 13 | Central Valley |
| Hanford | July 2, 2026 | 14 | Central Valley |
“Rising labor and real estate costs have made it increasingly difficult to operate profitably in California.”
— Industry analysts on fast food market challenges
Broader Fast Food Industry Contraction
Five Guys joins a growing list of restaurant chains reassessing California operations. The closures reflect systemic challenges facing the fast food sector statewide. Labor unions have celebrated minimum wage increases as victories for workers, yet some businesses argue the rapid wage hikes without proportional pricing power squeezes margins to unsustainable levels. Employee layoffs create immediate hardship for affected workers seeking new employment.
The company’s decision signals that even established, popular brands cannot absorb these cost increases everywhere. Five Guys operates a successful business model nationally, but specific regional markets prove unprofitable. This may prompt other chains to evaluate their California footprints more critically.
What Does This Mean for Five Guys Remaining Locations?
The four closures suggest that Five Guys has carefully evaluated which restaurants can survive California’s regulatory environment. The company retains more than 100 locations statewide, implying it found viable operations elsewhere. Yet the decision to shutter stores simultaneously sends a message about profitability pressure. Will other franchises follow suit, or has Five Guys completed its California portfolio optimization? Time will reveal whether additional closures loom ahead.
