$8.25 an hour in a million-dollar world

It was hard for lower-end workers to make ends meet in the Bay Area of the dot-com boom. And it's still hard in the bust.

By King Kaufman
Published April 27, 2001 7:30PM (EDT)

Downturn? What downturn? While high-tech workers gather at "pink-slip parties" and fret about the alternative minimum tax they've been saddled with by their now-useless stock options, Starbucks is hiring.

"Starting at $8.25/Hour," shouts a banner hanging in the window of the cafe near the corner of Market and Stockton streets downtown. Jason DiPatria already works the counter there. He hasn't noticed a drop in business as the economy has slowed. "The economy doesn't affect people's need for caffeine," he says.

Anna Petrovic (not her real name), who cleans houses in San Francisco, says she's felt almost no effect from the economic slowdown. "There really hasn't been for me at all," she says. In fact, at $15 an hour, she's still overbooked. One of her clients, trying to cut costs, asked her to come every three weeks instead of every two, "which is fine because I have people waiting for the slots," she says.

But Martin Campos (who, like Petrovic, asked that his real name not be used), a bellman at a Union Square hotel, has felt the pinch. "All the guests and our groups were kind of eliminated right now," he says. The loss of business means a loss in tips that can cut his take-home pay nearly in half. "The hourly is not much to rely on," he says as he stands on the sidewalk and smokes one of the cigarettes he's taken to conserving lately.

The boom didn't make millionaires out of everyone in the Bay Area, contrary to what you might have heard. Only about one in 17 civilian workers here works in a high-tech industry, though that figure includes, say, a dot-com's janitors and excludes related fields that have benefited from the boom, like advertising. And now in the bust, life goes on for the working folks in the earthbound sectors of the economy. It was really, really hard to make ends meet in San Francisco on an hourly wage during the dot-com days. It's really, really hard now.

The average rent for a newly vacant one-bedroom apartment in San Francisco the first three months of this year was $1,888 a month, according to Rent Tech, a listings agency. In February, the median price of an existing one-family home in the city was $573,530, reports the California Association of Realtors. The Bay Area median was $485,980. Only one in nine Bay Area residents can afford to pay that, the association says. Nationally, the median home price is $138,800, which nearly three in five people can afford.

Bay Area residents don't necessarily know these figures, but they can feel them. "I will never own a home here," says a housecleaner and bartender named Denise, echoing many. "It stinks." Ask the people who have been serving coffee, or cleaning houses, or carrying bags what would happen if they lost their jobs or the low-rent living situations they've lucked into, and you keep hearing the same answer: "I'd be fucked."

Denise, a 36-year-old native of Chicago's northern suburbs who asked that her full name not be used, has been cleaning houses and tending bar in the East Bay for 10 years, since she arrived from New York. How'd she get into those lines of work? "I came out here during the recession," she says, laughing. "The only job I could get was at a cleaning company where they paid nothing. I was making like $350 every two weeks, and that was for -- we would get there at 8:30 and work till 3:30, five days a week. It was awful." She eventually began working at a bar as well, and quit the cleaning company. "The people I cleaned for there found me slowly, like one or two of them, and then they recommended me to people, and so on and so on."

She didn't rise with the dot-com tide, though she blames herself for that. "I guess I should have been more ambitious," she says, "but it's like, you know, I wasn't. And you can clean two houses a day, and you're kind of killing yourself with three houses. So I didn't. And I didn't make a lot of money. With an old car, debts."

Like many who live on lower-paying jobs, Denise gets by thanks to a sweet rental situation that she finds herself clinging to desperately. "I'm really blessed in this area," she admits. She lives in what she calls a "weird compound thing," a group of cottages in Oakland, and she pays an incredible $410 a month to live alone. The landlord is elderly, Denise says, and his wife recently passed away. He's thinking of selling.

"He's getting ready to give it up, and I'm like, no!" she says. "I'm safe for six months. He said he just paid all the insurance and taxes, but he's starting to think about it."

Thanks to a friend hooking her up, Denise recently began working part time at a San Francisco staffing agency for "creative professional-type people," mostly in advertising. She works 32 hours in three days. "I'm making incredibly good money at the city job," she says. "They're paying me -- which I still can't believe -- $24 an hour." She still works two nights a week at a Berkeley Irish pub (a genuine one, it should be noted, not one of the prefab models that pop up across the bay), and has cut down on the housecleaning, though she keeps a few clients. All told, she works 52 to 57 hours a week, she says.

The staffing agency where she works has had to lay off one person, and Denise is hoping that the downturn will spare her, at least for a while. "I'm using this opportunity to try to get out of debt, and I'm hoping and kind of praying that it'll continue, but I have a kind of sick feeling in my gut that it's not going to," she says, "and it's like, shit, you know? If I can get out of debt I won't be so scared. But I don't know. If I'm not out of debt, I'll probably have to leave the area, and that terrifies me because then what? Where do you go? I'll probably have to get out of here."

Meaning out of the Bay Area. And why not do that? Why pay these prices? "I would love to live in some weird-ass small town," Denise says, "but I don't have any marketable skills. You know, people clean their own houses in weird-ass small towns. And I don't carve burls, you know, whatever, those burl tables, bears and stuff. I don't do that. So I'm kind of screwed in the small weird-ass towns. And I don't make methamphetamines either."

She says that, assuming she's still making city-job money, she'd be willing to pay up to $900 to live alone, which she'd like to do, because otherwise "I would have to live in a house with a bunch of vegans or some weird-ass shit you find in the [free weekly East Bay] Express. I just don't want to live with a bunch of people anymore, but I would probably have to, and it would just be awful."

But as nervous as she is, she sees real fear in the young people who have known nothing but economic boom times. "It's really amazing because I'm seeing résumés every day -- that's my job, I'm the one downloading all these résumés -- and people are desperate. They're calling and updating their availability, and they're scared," she says. "But, at the same time, people are hiring. I mean, there's hiring freezes, everyone's really scared in that [advertising] industry, but they just don't know that they can clean a house or something. They don't realize that because they're all like a bunch of 24-year-olds who just think that they're always gonna be wealthy."

And if the downturn does turn her into what she calls "a minor-blip victim," Denise knows she has options. "I think rich people are always gonna have people clean their houses, I really do," she says. "And if I get laid off I guess I'll just find more houses to clean. I mean, I'm not afraid of it."

DiPatria, 24, has been working part time at the Starbucks just outside an entrance to the Powell Street BART station -- one of 10 Starbucks in a quarter-mile radius -- for about three months. He says he makes about $1,000 a month, and that he figures he'll bring in an additional $1,000 from a new second job selling shoes down the block at Skechers.

Like Denise, DiPatria has an amazing living situation. He and two roommates pay a total of $900 to share a place in the expensive Noe Valley neighborhood with DiPatria's girlfriend, whose father owns it. He's been with his girlfriend for six months -- and living with her for five. Before that DiPatria, who is from Santa Rosa, an hour north of San Francisco (but only if you go in the middle of the night to avoid the traffic), was living in Petaluma, which is 15 minutes closer. His rent there? "Outrageous. It was like $1,100 for a one-bedroom apartment."

According to the FAQ on the Web site of Rent Tech, the listings agency, landlords expect tenants to gross three times their monthly rent. By that scale, a person making Starbucks' $8.25 starting wage, working full time, would be able to afford rent of about $475 a month, about a quarter of the average asking rent for a vacant one-bedroom apartment in the city. DiPatria, making $2,000 a month, ought to be able to afford about $665. Even Denise's "incredibly good money," $24 an hour, would only be enough to afford about $1,385 in rent -- $500 below the average one-bedroom -- and then only if she worked full time.

The downturn has brought some good news on the rental front, though. San Francisco's housing crunch has eased as laid-off dot-commers pack up the car and head back to, say, Des Moines, Iowa (average rent for a one-bedroom: about $470 in most parts of town, less in some areas), telling themselves that their sojourn to California has been, if nothing else, a valuable learning experience and résumé builder. There are actually vacancies now, and the days of would-be renters showing up at vacant apartments with briefcases full of cash or offers of sex or drugs are in the past. "We've got almost five times our normal inventory of vacancies," says Rent Tech owner Grey Todd. "Last year what we did all day long was work intensely to try and find people places, and now it seems we're working intensely to try to find landlords tenants."

That's translated into a drop in rents, though it's a slight one: They're down $25 over the first three months of the year. "But I don't think they will go down that much," Todd says. "It's a glut that may last a few months, maybe through the summer, but I don't think it will last beyond that because there just is not enough housing here, and I just think that the market will adjust itself accordingly."

DiPatria jokes that as long as he's nice to his girlfriend, he won't have to worry about such matters. And despite the fact that he'd prefer to make his living DJing at nightclubs, which at the moment costs him money because "I'm buying records and buying records and buying records," he likes the work at Starbucks. His job doesn't seem to have been affected by any economic slowdown. "I work with really cool people, and everyone that comes in here, I see them every day," he says. And as far as he knows, Starbucks hasn't had trouble finding workers to fill its openings.

Down the street at McDonald's, manager Harry Ng says the strength of the economy has less to do with finding workers than the location of the restaurant. "We're hiring for a different group of people," he says. "We mostly hire new immigrants and [students or retired workers], so if you're closer to Chinatown or something like that, then it's easier to hire people. But in other places, in areas where there's a lot of high-tech places, they can hire with higher wages; it's a lot of competition around there. Like Starbucks, Walgreens, they're fighting for the same group of workers."

McDonald's pays $6.25 to start, with a 25-cent raise every three months if the employee learns a new area, Ng says. After 27 years of such raises, that employee, working full time, would be able to afford today's average one-bedroom apartment in San Francisco.

In the wake of welfare reform, writer Barbara Ehrenreich wanted to see if it was possible to live on such wages, so she went undercover, so to speak, working entry-level jobs for monthlong periods in Maine, South Florida and the Twin Cities. She tells of her experiences in a new book, "Nickel and Dimed: Or (Not) Getting By in America."

"I held a total of six jobs, sometimes working more than one at a time," she says. "I averaged about $7 an hour, and often less, and the bottom line is: No, it's not possible. I can't even imagine the Bay Area." Ehrenreich says she last spent time in the Bay Area a year ago, when she taught at UC-Berkeley's journalism school, "and, you know, being paid generously, as a professional and so on. But it was a losing proposition with the rents there."

"It's just good to have good friends. Especially here," DiPatria says when asked to consider what he'd do if his current living situation ceased to be. "I got a couple other friends that I can go live with. Without a close-knit unit as far as your friends go -- I'd be fucked."

The dot-commers get the ink, but San Francisco remains a tourist and convention city. More than twice as many people work in those and related industries (restaurants, for example) than work in high tech.

"Don't forget tourism is a major engine generating a lot of these kind of low-end jobs," says Paak-yin Tam, an analyst in the San Francisco office of the state Employment Development Department. "Hotels, motels, restaurants, retail, these are all tourist-oriented industries. You can see lines at hotels and restaurants and Fisherman's Wharf, right?"

Not, bellman Campos says, at his hotel. Campos, 41, has worked near Union Square for 16 years. A member of the Hotel and Restaurant Employees and Bartenders Union Local 2, he says he takes home about $500 a month from his wages, plus as much as $500 from tips in a good month, but less than $200 in a not-so-good month. Lately, the months have been not so good.

"Actually, I talked to one of the assistant supervisors," he says. "He told us that for now we're going to get very much slow till June."

Campos lives with his parents in Daly City, immediately south of San Francisco, and helps out with the rent. Unlike DiPatria and Denise, Campos has the added responsibility of a family -- he has a wife and 2-year-old daughter "back home" in his native Philippines. He sends money to them every month, "absolutely," and is hoping to arrange to bring them here someday.

Getting by in the Bay Area when you are just supporting yourself is difficult enough, but when children are added to the mix, the problems become enormously compounded. Right now, Campos is just trying to make ends meet. "I just tried to cut off some of my expenses," he says. "I eliminate some things that I don't need especially, like, your personal things. You know, beer, of course. Cigarettes -- cigarettes are too high right now, you know? So I'm cutting, just like, not to smoke two cigarettes per five minutes, make it one cigarette for 10 minutes."

Campos says he has no hope of ever owning his own place in the Bay Area, but doesn't want to return to the Philippines because the economy is even worse there. He says he sometimes thinks about moving to Nevada, where it's cheaper to live, but he doesn't sound serious about it. "If I be like this for the rest of my life, I'll take it," he says, "but if I have a chance to improve myself, I'll do that. Just basic, not very much wishing for myself, but to get my own place, bring my wife and kid over to the States, and then, that's it. That's all she wrote for me."

Petrovic, the housecleaner who is still overbooked despite the downturn, isn't going to be returning to her home country either. Petrovic, 55, a Serb who came to this country in 1997 on a refugee visa, has been cleaning houses since shortly after her arrival, when a man approached her on the street and offered her $15 an hour to clean his house. She's now housesitting for him as he works in Europe.

Though she worked for 15 years as a forensic analyst and speaks five languages fluently, as well as several others not so fluently -- "you don't use it, you lose it, you know" -- she sticks with the housecleaning rather than, say, translation work. That might pay a little better, she admits, "but I don't take taxing."

Petrovic's rent-free living situation has allowed her to save a little money. But it ends in October when her boss returns home. She says she's not worried, though. She's lived in the shelter before and "if the very worst ever happened, I'm sure I can go to the shelter again if I had to. But I think things will be all right."

Whatever happens, an economic downturn, however serious it gets, would probably pale when compared to what Petrovic had to deal with in her native Belgrade, where, she says, "it was just bad."

"You know, if you had been through the things that I have been through in my life, you would not be worried, trust me. There is no one with a gun looking at me, you know?"

King Kaufman

King Kaufman is a senior writer for Salon. You can e-mail him at king at salon dot com. Facebook / Twitter / Tumblr

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