With soaring cost of living, San Francisco businesses can't find new low-cost employees

[Newsjock]

Source: Mission Local

While the boom in San Francisco has helped boost business, shops and restaurants are finding that they have no one to make the sales. “We’re desperate,” said Jefferson McCarley, the owner of Mission Bicycle.

... “It’s because the working class of San Francisco is disappearing,” said Chewy Marzolo, who manages Escape From New York pizza on 22nd Street. Despite the recent minimum wage hike, he said, the city is too expensive. “Even with that jump, which is huge… People can’t afford to work for it.”

... At Harrington Galleries, a furniture store on Valencia Street that has been in business for more than 40 years, finding workers is a struggle. ... Owner-manager Fiona O’Connor needs a part-time manager with some experience in interior design, who would start at around $16 an hour. After a month, she still hasn’t found anyone.

... “Honestly, to survive in San Francisco on $15, $16, $17 is not easy,” McCarley acknowledged. Which, he and others observed, is simply resulting in driving people out of the city and attracting more commuter workers.

Read more: http://missionlocal.org/2015/10/sf-businesses-finds-employees-are-scarce/

[Egnever]

1. $16 / hr for a manger?

That is ridiculious

[joeybee12]

45. In SF it should be at least double...nt

[BuelahWitch]

57. Part-time

So under 40 hours.

[hatrack]

2. Short version: "We can't find good workers at shit wages! Waaaahhhh!!!"

[Populist_Prole]

74. Bingo

And class disdain for the working class will impede any dynamic to raise wages vis-a-vis supply/demand.

Just read a story in some business rag last week or so of trucking companies complaining about a shortage of drivers. Though a couple of firms have done so, the article said raising pay wasn't high on their lists. Their solution: lobby for hiring teenaged OTR drivers.

[smirkymonkey]

3. I expect there will be more of this all around the country as rental and housing prices increase in

major metro areas while wages, particularly working class wages, stagnate.

[davidn3600]

12. It's in most places around the country already

Stagnant wages are only part of the problem.

The mortgage crash created a flood of renters. So now renting is a bubble and pushing the cost of living up. Some people may also be moving back more towards the urban centers in order to find better work. That's increasing demand.

[madville]

5. Makes sense

A $16 an hour job here in my rural area would have a bunch of applications. I left making about $32 an hour in a city to $24 and being able to live in a rural area. Housing is half as much, property taxes are 2/3 less. $100,000 here will get you a decent house on 1 to 5 acres of land, in the city it would get a fixer-upper on 1/4 acre at most.

In the last job I had in a city we had problems finding and retaining decent employees at around $18-22 an hour. Our three biggest turnover reasons though were substance abuse (alcohol and drugs), DUIs (couldn't drive a company vehicle any longer) and stealing (seen employees lose a $50k a year job for stealing a tank of gas of the company gas card or scrap metal to recycle). Maybe if they had paid more it would have attracted a higher quality employee.

[appalachiablue]

6. Very important issue and dilemma, self inflicted by gross income inequality. The gentrification

in major metro areas like SF, Sea, Portland, Chicago, NY, DC, London and more cannot continue. It's destroying people, communities, states and our country.

[Texasgal]

8. It's happening quickly

in my hometown of Austin, TX as well.

[appalachiablue]

11. I believe it. The cities I mentioned are rapidly undergoing change in the last 5-15+ years and

it's so very damaging. Without knowing specifics, I didn't include other cities like Austin but I've heard extreme gentrification is widespread. Many people in the suburbs are barely hanging on too and there aren't a lot of services in those communities usually but the problem isn't mentioned as much. As far as the rural poor in the Ozarks, Dakotas, Appalachia, southern Delta, etc. they've been too left out it seems unfortunately. There's a good OP on the reality of rural America posted on DU now. Very distressing conditions-

[KamaAina]

47. Oh. That's mine!

http://www.democraticunderground.com/10027284008

Mahalo (thank you)!

[appalachiablue]

66. Excellent KamaAina, glad you spoke up! A very troubling issue, American Rural Poverty

that is touched on less and less as time goes by. So very bad for those people and communities.

Suggestion, put a title above your link so people here can spot it, it's relevant and important. Thanks again.

A new DUer wrote a good comment that I want to reply to, person from KY who moved to large cities. A Hillbilly like me.

[Eleanors38]

17. You know it. I live near BS Springs, and my place is worth 550k, but the taxes...

are high, and I can see folks in lower paying jobs crashing in hugely expensive housing. They will eventually cut out, then real estate prices will drop. My challenge is to seel out before that happens, and find a 24 wide somewhere on the Edge of Night, somewhere.

[Texasgal]

22. I grew up in Central Austin

In an old house located in Travis Heights. My parents still live there and have owned the house for 30 years or more. The taxes are getting ready to drive them out. It's insane!

[Warpy]

40. Vancouver, London, Dubai, San Francisco and a few other places

are having their prices completely skewed by international 0.1% plutocrats snapping up all the prime real estate, especially the fancy new builds, and allowing it to sit empty as an investment. That means there is a scramble for all other types of housing while the people building the new, glitzy towers are all hoping to make a killing selling to robber barons with too much money and no brains, meaning that all those fancy new places represent a net loss in housing and no gain for the people who live and work there. Gentrification also has a role, converting SRO buildings that house a couple dozen workers into mansions that house 2 yuppies, one rugrat and maybe a nanny.

Exhibit A: http://www.crackshackormansion.com/index.html

[stevenleser]

62. The difference re: NYC is that there are cheaper Burroughs with good mass transit for commutes

I lived in Astoria, Queens for some time. The train from there gets you into midtown Manhattan in 20 minutes. Rents were less than half of Manhattan. They have gone up a bit since then. But there are plenty of parts of Queens, Brooklyn and the Bronx that have cheaper rents than Manhattan but from where you can still commute easily using mass transit.

Harlem and Inwood are other options within Manhattan.

I am not saying NYC is Nirvana or anything, but it has advantages over other cities with high rents downtown. It's a lot more like the higher priced European cities in the sense that sure, the city center is expensive, but there are options if you are willing to commute and the commutes aren't bad thanks to good mass transit.

[GOLGO 13]

71. Lived in the Bronx for 40+ years. Rents are getting critical there too...

Moved upstate to a Orange County townhouse for $1400 a month (oil included). Same money will get me a 2 bedroom in a nasty, foul Bronx neighborhood with bonus gladiator school for my young kids.

A lot of what you say is true about the transit system

[mmonk]

75. Yes.

[geek tragedy]

7. San Francisco is a gated community.

The solution is to really raise taxes on higher income residents.

[mythology]

78. That wouldn't address the lack of affordable housing

There would need to be some sort of rent control and more affordable housing built.

[geek tragedy]

79. who's going to build the affordable housing? nt

[Downwinder]

9. Better get those robots up to speed.

See if you can operate without humans.

Then where will the customers come from?

[dreamnightwind]

10. A problem with a national minimum wage

I've been saying this for a long time, economies are local, not national. From a worker's perspective, it makes no sense to have the same minimum wage in SF as in Alabama (or insert your favorite affordable locale here, I don't know, I live in the bay area where it is expensive).

$15/hour in SF is really sub-poverty, can't get housing and pay for food and living expenses for one person for that, let alone support a family.

Why not index it to local economies? Any better solutions?

[Kilgore]

14. Great Idea!

A universal one size fits all approach hardly ever works.

[moondust]

15. It seems obvious.

I've never heard anybody in office propose it and I don't know why unless it is to prevent poorer people from moving to expensive gentrified areas they can't afford under the current minimum wage scheme. Something like the MIT living wage calculator would seem to make it fairly easy to calculate at least at the county level, maybe further.

One alternative to a minimum wage is the Swiss "1:12 Initiative" that limits top pay in an organization to 12 times that of the bottom pay. Something like that would seem to prevent runaway greed and gross exploitation.

[dreamnightwind]

28. I hadn't seen MIT's living wage calculator

I'm still sifting through their doc seeing what criteria they used and what the results mean. I checked two areas that I know and was surprised how little difference the results showed so was wondering about te criteria. Anyway it's a great idea and if the methodology is good it's an excellent tool, thanks very much forr providding that link.

Agree that the 1:12 rule or something similar is good, I didn't know about the Swiss but I had heard the Japanese have such a rule, perhaps with a different ratio.

Also a Maximum Wage might be an idea whose time has come. It isn't that simple, of course, a lot of comensation comes in non-salary forms (stock options, bonuses, perks, etc.) but though complex it seems there would be a way to set a ceiling on compensation. To some that might sound "un-American", but seeing how late-stage capitalism has developed, I think it's a good idea. There is a certain level of compesation after which society could reasonably say it's more than enough, and detrimental to society.

I hope Bernie gets behind and articulates ideas like these, if he isn't already doing so. Common-sense socialist tweaks on a runaway capitalist society.

[moondust]

29. Similar to a maximum wage,

I think a "reasonable" cap on inheritance would help temper the greed and strengthen meritocracy. If you can't pass it all on to somebody who may have done nothing to deserve it when you kick the bucket, then why bother accumulating billions and billions in the first place? Especially if the big bad government is going to take the excess and use it to build and maintain high-speed rail services, fix highways and bridges, etc., for the benefit of the "losers." It would tend to cut down on the number of Trumps, Kochs, and Waltons calling the shots simply because they have the fattest bank accounts rather than the best qualifications and ideas.

[dreamnightwind]

32. A good idea, what about foundations and the like?

The oligarchs accumulate wealth to use it to shape the world with their own ideas as much as to pass it on to their kids. I would like a world shaped by the interests of those whose needs are not met not by the ideas of people who have never known such needs, can't understand them in any tangible way, and in many cases, as you suggest, just view less fortunate people as losers.

So my point here is we would also need a way to curb this kind of influence. they create foundations and institutions to shape the world to their liking that persist long after they leave this earth. Inheritance won't touch that. A maximum wage, or better a cap on total compensation, some way of preventing this wealth from accumulating to that degree in the first place, might have a better shot at returning the balance of power from the few very rich to democratically run institutions.

The other component of course is putting the democracy back in government. Another current OP had a link down thread to this study, I'll just paste here:

http://www.democraticunderground.com/1251724264#post52

http://journals.cambridge.org/download.php?file=%2FPPS%2FPPS12_03%2FS1537592714001595a.pdf&code=e40d65fc61c134913e3ad43a422129d3

Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens
Martin Gilens and Benjamin I. Page

What do our findings say about democracy in America? They certainly constitute troubling news for advocates of “populistic” democracy, who want governments to respond primarily or exclusively to the policy preferences of their citizens. In the United States, our findings indicate, the majority does not rule — at least not in the causal sense of actually determining policy outcomes. When a majority of citizens disagrees with economic elites or with organized interests, they generally lose. Moreover, because of the strong status quo bias built into the U.S. political system, even when fairly large majorities of Americans favor policy change, they generally do not get it.

The fix to this of course is public funding of elections, and ending revolving door relationships between government and industry.

There's a lot to do, and it will all be difficult to achieve. It starts by identifying the tasks, electing a leader who believes in them (Bernie for the win), and fighting like hell no matter how many times we are defeated.

[wordpix]

68. totally agree, and this extends to poverty calculations, too

for things like Medicaid, SNAP, etc. My state of CT has a Medicaid threshold of something like $13K/year, which you can't live on in CT. Maybe that works for _____affordable state, but not here. So if you make $14K, you still can't afford to live here but you're too "wealthy" to get Medicaid, so you go to O-care if your employer doesn't cover you. And then you've got the premiums, copays, etc. but you can't afford decent food or housing. And it's COLD here in winter.

Just keep the poor getting poorer, you rich asshat repukes, and find out what happens once the poor understand why it is this way. Go, Bernie!

[dreamnightwind]

73. Yes, this isn't rocket science

They could index it to local economies if they wanted to, just like they could find a mechanism to offset the wage differential of economies when companies want to hire workers in some other state or country (probably only makes sense for other countries). So my guess is they like it this way, it must be beneficial to business interests somehow. From a worker's perspective in a high-priced area it really sucks.

[Rex]

13. Aww...

I guess the only other thing to do is go out of business.

[hifiguy]

16. If you cannot pay a living wage by the standards/

cost of living in the community, you deserve to go out of business.

Though the reimposition of slavery is more likely to happen than that coming to pass.

[Nye Bevan]

18. This is how wages go up.

When businesses desperately need to hire people and can't find any, at some point they will realize that they need to pay higher wages to attract the staff they want.

[NBachers]

30. And the people who've been dutifully working for years get bypassed by the new hires.

[Nye Bevan]

42. And such people should have no trouble finding new jobs that pay them their fair market value (nt)

[LanternWaste]

46. It is fun to pretend as such.

"no trouble finding new jobs that pay them their fair market value..."

It is fun to pretend as such.

[Nye Bevan]

51. Isn't this thread about employers being desperate to hire people? (nt)

[Recursion]

19. Build. Taller. Buildings.

There's not enough housing to house the number of people who want to live in San Francisco. So they need to build more places for people to live.

This isn't rocket science.

[Sen. Walter Sobchak]

26. Yeah, 500 square foot condos starting at $1m will solve all SF's housing woes

There is no market solution to this.

[Recursion]

27. "The market" didn't get us here; nostalgia for Victorian architecture did

Last edited Mon Oct 26, 2015, 01:02 AM - Edit history (1)

And forcing people to give up on that nostalgia and actually build 20th (let alone 21st) century style buildings would actually solve a lot of SF's housing woes, as there would no longer be one quarter as many units as there are people who want to live in the city.

"The market" wants to build a ton of skyscrapers in SFO but current owners won't let it (precisely because it would drive their rents down -- every highrise full of million dollar condos makes rent on the brownstones that much cheaper).

[Sen. Walter Sobchak]

31. "the market" wants to build pied-a-terres for the super-wealthy and

and safety deposit boxes in the sky for Russian and Chinese gangsters.

Cities all over the world are building a fuck-tonne of residential skyscrapers of remarkably little benefit to anyone actually living there. These are the slums of the future.

I have worked on financing condo developments, it has been an enlightening experience.

[Igel]

41. "The market" complained for years.

But everybody knew that the way things were being done would yield wonderful results. The hypothesis was assumed true and the city was an experiment.

Cause --> effect. If the cause doesn't produce the desired effect, perhaps the experiment falsifies the hypothesis.

Protect large areas from development, make other areas too low-return to make development in the least profitable. You get less development overall, with "development" in this case meaning "living space."

"There is no market solution" immediately removes a mess of undesirable solutions that might work but which, if they did work, would cause massive (psych) damage. It's like saying, at the start of an armed conflict, "There is no military solution." You immediately reduce the solution space, and might a priori rule out the optimum solution entirely. While you search for the best remaining solution or the only remaining solution, though, things continue to get worse.

[Sen. Walter Sobchak]

44. And would an outcome like that in New York, London, Toronto or Vancouver be desireable?

Where a massive amount of development has not merely failed to improve the overall housing situation but has made it spectacularly worse?

Build this shit and in fifty years it will be the new Tenderloin, but in the meantime it will be a place for shady offshore investors to hide money or a place for the CEO of "Uber for Handjobs" to sleep off a $20,000 bender.

[KamaAina]

48. Brownstones?

I thought those were unique to NYC.

[Recursion]

60. Yeah, I couldn't remember the bay area word for "rowhouse" (nt)

[KamaAina]

63. Townhouse?

There aren't that many compared to Eastern cities. It seems to go straight from apartment buildings east of Twin Peaks to detached homes west, and in Pacific Heights, etc..

[threethirteen]

35. You know that taller buildings in this city creates more wind, right?

And where is all the excrement/sewage going to go? Where is the water going to come from? Where are the people going to walk? This city is 7 miles by 7 miles. That's it. Taller buildings isn't going to solve the problem. It will just make the city more gloomy and windy.

[Recursion]

38. OK, then high rents are there to stay for a while

As long as more people want to live in SFO than SFO can fit, that's going to drive rents arbitrarily high unless we set up a Danton-esque "Housing Committee".

If higher density really isn't possible (and I disagree with you on that -- there's a lot of room between where SFO is now and "skyscrapers", though I know I introduced that word), then you guys absolutely need to fix regional transit, yesterday. My wife is from Fremont, which isn't cheap but is certainly much more affordable. There needs to be a functioning train from there to Oakland and SFO.

That said, density doesn't have to only be in SFO proper: Palo Alto, Mountain View, etc. could build much, much more densely than they are, and should.

In the bigger perspective, this return to urban centers by rich people is exactly what urban activists were calling for for decades when they decried "white flight". The rest of the Bay just needs to catch up.

[KamaAina]

50. BART has ordered its "Fleet of the Future"

The first new cars since the system opened in the '70s (!!) will be coming on line in a couple of years.

Oh, and "SFO" is the airport.

[truedelphi]

20. Why are there so many posts that mention raising the wages, and NONE

mentioning the obscene rise in rents?

Why not stop a meteoric rise in rents?

Wages being raised means that:

One) the working recipient of the higher wages will lose any benefits they might now possess, such as food stamps and AFDC. They won't make enough EVER to afford a house with a mortgage, in a housing market like San Francisco Bay Area, so they will then be paying huge amounts in taxes. (Taxes could double or even triple.)

Two: Businesses will pass the cost of higher wages on to the services provided. So a family that eats at a fast food place will probably have to learn to east less. Even though they are being paid more.

[hedgehog]

23. It's not the worker who is the beneficiary of food stamps or AFDC; it's

the employer who doesn't pay a fair wage and gets a tax payer subsidy to keep his employees from starving.

[appalachiablue]

64. Very good point and a foul reality that's rapidly getting worse in metro areas.

THE RENT IS TOO DAMN HIGH!!! Remember that guy in NY? He was right!

[truedelphi]

76. I won't even mention my joint income with spouse

The year we left the SF Bay area as then people here would think I was one of the filthy rich.
(We left in 2005.)

And yet it simply was not enough money. Especially given the fact that we were locked out of having a mortgage deduction, as even a delipidated garage was selling for around $ 200,000.

After taxes took away 28% + 15% for Social Security (Since I was self employed) then the high cost of food, and so we were always broke. And we were living in a very low rent situation, so the high rents did not even affect us.

One of the amazing things about Lake County is that food prices are so very low. (At least in comparison with SF grocery stores.)

BTW, I don't know what guy in NY you are meaning? Any link? Love to hear about it in detail.

[msongs]

21. simple - hire the homeless and street people nt

[Sen. Walter Sobchak]

24. The only people I know who still live in SF...

Live in houses they inherited.

And even they are cashing out and leaving the open-air mental institution on the bay.

One of my colleagues just sold her grandma's teardown house near Presidio to some some space cadet from India for enough that she is retired at 44.

[mountain grammy]

25. I live in a resort community.. lot's of empty second homes

or vacation rentals, but few places for people to live, and housing costs reflect the supply and demand. The great American working class is being priced out of the market.

[Hydra]

34. Same here, and the employers are screaming for (low wage) workers

But there's no housing, even for the people who usually pack the places like sardines.

Our system is collapsing because the basics are ignored in favor of obscene profits.

[jamzrockz]

33. One has to wondering

how much longer before there is a correction in the cost of living in that city. San Fransisco is not like other big cities where workers can get away with living in not up to code living areas.

[threethirteen]

36. And where were they when all those people that would have filled those position were being evicted?

Let's look at this logically. If I have been living in a rent controlled apartment for 10 plus years, then I can probably take a job that pays closer to min wage. If I am evicted because real estate speculators want to sell an empty building of rental units with a guaranteed min rent, then I can't take that low wage job now can I? I won't be there anymore.

They made their bed by doing nothing to help people getting evicted from rent controlled apartments. Now they have to lay in it.

[Recursion]

39. This is a furniture store, so they were probably cheering the approach of another DINK couple

to the neighborhood.

This could all be made a lot better by a more robust regional transit system. Even DC -- hell, even Atlanta -- has a better transit system than the Bay.

[Luminous Animal]

55. It is a used furniture store next to a used clothing store.

[spiderpig]

58. Thank you for bringing up the pathetic SF public transportation system. Recursion

In addition to being dirty and stinky, it costs a fortune. BART doesn't have monthly passes and doesn't run on schedules where a lot of people actually WORK. I was paying $13 a day to commute 3 hours round trip to my $20/hr job. And I had to drive 16 miles to the nearest BART station.

I've ridden public transportation around the world for decades, but SF is off-the-charts worst.

[Warpy]

37. You're not desperate enough to PAY THEM, McCarley

Until you are, go fuck yourselves.

[LuvNewcastle]

43. Poor widdle assholes can't find help

to work in their McMansions and make their sushi. I'll trade problems with them any day.

[brentspeak]

56. I don't think the small business owners here

are spoiled, sushi-eating McMansion rich jerks. You're confusing them with vulture fund capitalists and banksters.

They're just small business owners, struggling to maintain their businesses.

[wordpix]

69. as one who's been both employer in a big city and employee

I see both sides of the issue, too. The problem is about income inequality and the rigged system

[jwirr]

49. About time that you realize that you cannot turn a whole

city into a gated community. As any good Democrat knows someone has to do the real work.

[KamaAina]

52. Xposted to California group

http://www.democraticunderground.com/?com=forum&id=1040

[Arugula Latte]

53. Hey, good news, everybody! In a few decades this won't matter because SF

will be under water!

[KamaAina]

59. Not all of it

Those hills are awfully high. Mt. Davidson tops out at 925 ft.

"Historians are unsure whether San Francisco was a city or a chain of independent islands off the coast." -Robert Anton Wilson, Illuminatus!

[ohheckyeah]

72. 925 ft. is a

mountain? Seriously?

[Starry Messenger]

54. Oh who could have foreseen that?

[TeeYiYi]

65. Good. Fuck them!...

I'm tired of the direction this country is headed with their lopsided economy and dedication to the 1%. I remember when the concept of living in San Francisco was open to everyone, so fuck them. Let the 1% provide housing for the 99% of people who are serving them and waiting on them, hand and foot.

TYY

[yuiyoshida]

70. Seems like when I left Santa Barbara

it was becoming just that. The rich people living with the poor who are their gardeners, and kitchen Help. I love San Francisco, but must admit, despite Rent control, this city is getting harder and harder to live in. When the middle class disappear here, this city may see some changes it definitely won't like.

[wordpix]

67. same with DC soon

There are a few neighborhoods left with reasonably priced housing but the crime there is not good. DC attracts lots of immigrants but they have to live outside the city, the farther the cheaper. And then you get gridlocked traffic...

[Victor_c3]

77. Supply and demand?

Basic rule of capitalism.

Supply is lower than demand then the price needs to go up. If businesses want employees, then they need to pay more for those employees if there aren't enough.