Cost of housing drives workers out, survey says

百宝箱 · 发表于 2006-12-13 10:01:54

Employers in San Luis Obispo County have collectively lost hundreds of employees in the last few years in part because of the high cost of housing, according to a survey conducted by The Tribune.

The majority of the respondents to the survey said that the cost of housing was a "major problem" in attracting and retaining employees. In particular, midlevel or higher professionals, many of whom have household incomes that approach or exceed six figures, are most at risk for leaving the area.

Confronting employers and employees alike is the fact San Luis Obispo County is one of the least-affordable markets in the nation. The latest median-home price, taken in October by the California Association of Realtors, stood at $560,980. (At that, half the homes sold for more and half for less.)

Desperate to attract employees and keep the good ones they have, many employers in the county are relying on persuasive tactics like paying relocation costs or helping with down payments, the survey revealed.

Mid-level overlooked

The Tribune recently surveyed employers in the county to understand the impact housing prices are having on worker recruitment and retention. Of the 125 employers that responded, 64 percent identified housing as a "major problem," having lost collectively approximately 300 employees over the last three to four years in part because of skyrocketing home prices.

In total, 70 percent of the respondents said they had lost workers in recent years in part because of the cost of housing, while 58 percent of the departing employees cited housing costs as the primary reason to leave.

Not one respondent said housing costs are not a problem.

"Affordable housing has lost its meaning from my perspective," said Steve Fleury, president of Cambria Bicycle Outfitter. "When we talk about affordable housing, I don’t think that midlevel employees are being addressed. They don’t qualify for the low-income housing, but they still can’t afford to buy a house."

In the third quarter of this year, only 18 percent of first-time buyers in San Luis Obispo County were able to purchase an entry-level home, priced at $496,500 or 85 percent of the overall median home price, according to the California Association of Realtors. To afford that home, a buyer would need a minimum household income of $102,570, according to the association.

"Wages are insufficient for midlevel workers to buy a house. Virtually every business in San Luis Obispo County has a recruitment problem for higher skilled levels," said Bill Watkins, director of the UCSB Economic Forecast Project, a group that studies the local economy, including housing and wage trends. "But if you are a business competing with companies outside of the area, you can’t raise wages. For many people, they must move."

Fight or flight

The pressures of housing costs and the lack of affordable space to expand his business motivated Roger Malinowski to move his business — B.O.B. Trailers and Strollers — to Boise, Idaho, this past January.

Half of the company’s employees moved as well and nearly all have purchased a home in Boise. According to Money magazine, Boise was ranked one of the best places to live in 2006 with a median home price of $183,008.

The company has relocated to a facility that is three times the size of its former home in San Luis Obispo and costs about one-third of what it would here. Revenues are up 40 percent over last year and the employee base has grown from 13 to 20.

"It was a simple mathematical exercise for us. If you are not selling into the local market, there is no reason to be located here from a business perspective," said Malinowski. "Response to stress is flight or fight. We looked at the fight and we chose flight. It’s a battle that we couldn’t win."

That math makes it just as difficult for area employers to attract individuals living and working in other markets. Linda Quinones-Vaughan, a Bakersfield resident, had to turn down the position of program director for the Women’s Business Partners program at Mission Community Services Corp. in San Luis Obispo this fall because of the cost of housing.

"The job was so attractive and I love San Luis Obispo, but our standard of living would have changed significantly," said Quinones-Vaughan. "The cost of living was just too high to justify."

The departure of area businesses concerns Michael Manchak, president and chief executive officer of the Economic Vitality Corp. of San Luis Obispo County.

"This problem is worse today than it was a year ago and there are no signs of it getting better," said Manchak, who works to promote the start-up, expansion and attraction of businesses in the county. "There are many groups of people working to solve this problem but the solutions have not come."

百宝箱 · 发表于 2006-12-13 10:02:10

Options for home buyers

City and county officials counter that housing remains at the top of their agendas. Increasing the supply of housing, they say, will help to offset the problem.

"We are spending lots of taxpayer dollars in terms of staff time in trying to both preserve what affordable housing we have and creating more workforce housing," said Dana Lilley, supervising planner for San Luis Obispo County Department of Planning and Building. Work-force housing is designated for families of four that make 160 percent of the county median income, or $102,000.

In Paso Robles, officials are looking at redeveloping the west part of the city and are re-evaluating density, said Ed Gallagher, city housing programs manager. He also noted that two new neighborhoods encompassing 500 acres in southeast Paso Robles are currently in the planning stages. The communities would showcase a variety of housing, including apartments and smaller single-family units.

"(Home) prices will go up. We can’t expect that we can turn those prices around. So we are trying to come up with more options for home buyers in Paso Robles," said Gallagher.

Dave Romero, the mayor of San Luis Obispo, points out that the city has made "significant progress" in the last four years at increasing housing, noting that the city has 2,000 units currently at various stages of development.

However, he is worried about businesses leaving the area.

"I am concerned. A successful city is one that attracts businesses to come here and thrive," said Romero.

Business solution

Many business owners have had to become creative at retaining employees and bringing new ones on board. Those who responded to the survey said they were paying relocation costs, helping with down payments, paying sign-on or generous annual bonuses, providing flexible hours or telecommuting to employees, hiring trailing spouses and offering generous benefit packages.

Individuals like the EVC’s Manchak and Fleury of Cambria Bicycle Outfitter would like to have a broader discussion with other businesses aimed at a more communal solution.

"This situation would best be served not just by the government but also with a private-sector approach," explained Manchak.

Manchak was recently approached by Fleury, who had learned of a public program in Long Island, N.Y., that assists employers in retaining and recruiting employees by providing financial assistance toward a home purchase. As part of the program, an employer can contribute up to $10,000 to an employee and the government will match the contribution 3-to-1.

While Fleury would like to find a solution that does not depend on public money, the program does provide a model for discussion within the local business community, he said.

"If we want to retain employees and help our local businesses thrive," said Fleury, "we have to become pretty damn creative."

What needs to be done to make SLO County affordable again for working families? Go to sanluisobispo.com to post a comment.

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Cost of housing drives workers out, survey says

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