
'It's a crisis': Facebook kitchen staff work multiple jobs to get by - sandino
https://www.theguardian.com/us-news/2019/jul/22/facebook-cafeteria-workers-protest
======
ZhuanXia
Increasing wages will not help as they will be captured by rising rents. I
hate to get all Georgist here, but landowners are not creating economic value.
In fact, by supporting zoning laws they are vastly worse than landowners
historically. They are leaching off the productivity of the city. The
moustache-twirling villains are not the business owners nor even the
corporations, it is the land owners who created nothing yet receive most the
value these workers generate. Just because this is a tyranny of a majority who
owns, this does not make their yoke any less evil.

From a policy perspective, I like federal land-value taxes that tax based on
the counterfactual value of the land absent zoning restrictions, which would
internalize the costs of zoning on landowners.

But almost no common law jurisdiction has escaped the zoning-law trap, save
for Texas. So I don't see it getting better any time soon.

~~~
ihm
Increasing wages obviously would help. The other workers at Facebook (i.e.,
these people’s coworkers) who make six figures are able to live comfortably.

I agree with you that our economic model for housing and land ownership needs
to change though.

~~~
methehack
It might help short term, but I don't think its obvious it would work long
term. The idea is that it wouldn't solve the structural problem.

The structural problem is that nothing prevents landowners from charging
whatever the market will tolerate and so sucking all plausible value out of
the people paying the rents -- even to the degree that renters are forced to
work so much they do nothing else and should expect a shorter life. Since
there's no structural impediment to doing so, if you pay the renters more, the
landowners will take the value...at least eventually.

~~~
agent008t
But it's supply and demand at work. Limit rents, and people will have to queue
for housing.

~~~
methehack
Markets are a brilliant tool. We have to decide on the society we want, and
use markets to shape it. Very few scenarios that make any sense would allow
markets to function w/o purposeful shape.

I think managing a queue might be a better way to preserve everyone's dignity
than letting raw market forces work it out. Either that or I think you'll end
up paying engineers to make $50 sandwiches, which doesn't seem like it would
generate maximal economic value for the parties involved.

------
forgotmyhnacc
Many restaurant owners in the bay area are annoyed at Google and Facebook,
because they keep on hiring away their line cooks and other staff with higher
pay and better benefits.

I suppose this article is on the front page because it bashes tech companies
though.

~~~
sandino
So what you're saying basically is -- because (some of) the restaurant
industry pays even worse than tech --

That the tech industry's pay levels are, ergo, no problem at all?

~~~
whatshisface
The parent is saying that if you're going to fight for labor you should
probably start with the local restaurants, because they're the biggest
problem. If that doesn't fit the "stick it to the big corp" thing then I guess
things might be more complicated than that.

~~~
sandino
Another way of looking at the issue is - we can also make a lot of progress if
we set certain standards for those companies that are clearly able to pay
more.

~~~
conanbatt
Or simple cut out the benefit altogether, which will depress the wage below
what it is now plus increase unemployment.

------
thorwasdfasdf
The bay area Housing situation is hopelessly screwed up. There's no way in
we're going to be able to undo 50 years of political insanity and build enough
housing for everyone in just a few years. It's time we accept that hiring in
the bay area is no longer feasible. Right now, this isn't Facebook's problem.
As long as there's still desperate people to hire, then they'll always be able
to hire more.

We (the people that work for these companies and the voters within the city)
need to take a stand, and start lobbying these companies to get out of the bay
area. Or at the very least, we need to start asking for much higher salaries.
600k to 800k needs to be the norm to live in palo alto to afford an average
house (2.5M - 3.5M).

Personally, I don't think people are going to be able to do it. There's such a
vast oversupply of labor, that the employers have a much stronger bargaining
position.

There's still many other cities with plenty of tech people to hire. i don't
see why all tech companies have to be in the 1 place where local voters don't
want any residential growth.

~~~
chillacy
Employment has inelastic demand, people will work for anything to survive
because they have to. It’s that or get your way into disability, which an
increasing number of people do.

------
floren
I hope these people manage to get better pay. I hope the same thing happens
all across the Bay Area in all service jobs, and I hope the pressure trickles
up until the tech employees feel the squeeze of $25 burritos, plus even worse
rents as the people making their lunches can afford to live in the city and
compete for housing. Then I hope people either stop accepting tech jobs in the
Bay Area, or companies decide it's a losing proposition to set up shop in a
place where you have to pay $250k a year to a new grad.

We've got better communications and networks than any time in history. Why do
software companies, which consume no raw materials and produce no physical
product (both good reasons for setting up in a port city), all need to cluster
in half a dozen spots? Think how much more runway you could get out of your
seed funding if you set up shop in Missoula or Albuquerque, where you can rent
a whole house for $1500/mo, can hire from the local university, and have
beautiful outdoor recreation within a 15 minute drive?

~~~
chillacy
I would be cool to see YC try remote cohorts or build a cohort in a cheaper
location.

~~~
conanbatt
They've tried and found it very unsuccessful, unless they buil the entire
batch-infrastructure.

But companies will definitely start opening more and more satelite offices
everywhere. The same salary for the same company in SF or Seattle yields 2-3k
a month more for a software employee, and housing costs 1/2\. Eventually the
table turns and then SF won't be able to do anything about it.

------
cameronbrown
The answer of course is to distribute. Silicon Valley has an echochamber
problem already, maybe it's time for these companies to spread out/move their
HQs across the US. There's plenty of room.

What's so special about the bay area? Surely if FAANG move somewhere else
their employees will follow.

~~~
sct202
Toyota moved their headquarters from LA to Dallas a couple years ago, and they
retained 2/3's of their HQ employees in the move. FAANG isn't exactly the same
but it's the closest example I could find of a recent large scale move from
California.

If there is a point where the tech industry starts to grow less and be more
stable, you'll probably see some companies trying to make the move. But right
now it'd be too disruptive to potentially lose 1/3 of your HQ employees in a
move and screw up any growth plans you had.

------
roenxi
I have a huge amount of sympathy for these people. Clearly something is going
wrong and they shouldn't be the ones dealing with it. That said...

> "When a company is trying to pay you the same rate that they pay in other
> cities, we can’t accept that." [said a line cook]

If it works for other cities, the problem clearly isn't the rate of pay. The
problem is probably local politics of housing. Demands like that are not
completely reasonable.

~~~
ashelmire
> If it works for other cities, the problem clearly isn't the rate of pay.

Ok. So if they earned 5 dollars a day, it would be ok because it works for
cities in third world countries? I think it's obvious that the local cost of
living is always a relevant factor in pay.

~~~
roenxi
The US has a federal minimum wage of $7.25/hr. This isn't a comparison with
the 3rd world, this is a comparison with civilised, livable and comfortable
lifestyles in other US cities.

It is obvious that the cost of living is a relevant factor. The question is
why are the costs of living higher in California than elsewhere? It isn't
because rich people exist. It is because California doesn't have enough houses
for the marginal house-hunter.

Paying the marginal buyer more isn't going to create more houses. If there
wasn't a place for them to rent before, there still won't be when you pay them
more. If it were possible to create more houses, the current prices would
already be making it happen.

~~~
ashelmire
You've moved the goal posts a bit, but regardless:

> The US has a federal minimum wage of $7.25/hr. This isn't a comparison with
> the 3rd world, this is a comparison with civilised, livable and comfortable
> lifestyles in other US cities.

There is no where in this country where $7.25 is a liveable, comfortable wage.
It is the lowest amount legally allowed. And very few work for that wage - and
very few of them are independent adults. See [1]. Nowhere in the United States
can a minimum wage worker (or even close to it) affording the average 2 br
apartment (say, if they had kids); and there are only a few places in the
country where someone working 40 hrs / week on minimum wage can afford a 1 br
apartment [2].

> It is obvious that the cost of living is a relevant factor. The question is
> why are the costs of living higher in California than elsewhere? It isn't
> because rich people exist. It is because California doesn't have enough
> houses for the marginal house-hunter.

I hope the above mentioned points make it clear that this is not a problem
just in California, but nationwide. Which means wages are insufficient
nationwide and cost of living is too high nationwide.

> Paying the marginal buyer more isn't going to create more houses. If there
> wasn't a place for them to rent before, there still won't be when you pay
> them more. If it were possible to create more houses, the current prices
> would already be making it happen.

I'm going to assume you're arguing in good faith here and respectfully
disagree. The problem isn't that there aren't homes for them to buy or rent;
the problem is that those homes and rentals are at too high a price. At $20/hr
maybe they can afford to live in .5% of available rental units; and at $30/hr
maybe they could afford 5%. That's a tenfold increase in potential living
spaces, without those living spaces becoming more affordable.

Yes, the other issues in the bay area exist, with the NIMBYism and such. But
these problems still exist nationwide. There are a few potential ways for
government to help solve this issue. The main ways (hopefully I didn't miss
any obvious ones) are: increase minimum wage or average wages via law or other
influence; increase taxes on home ownership, especially for non-residents;
introduce rent control laws; provide incentives for and remove obstruction
from building new construction, especially high density construction.

1\. [https://www.bls.gov/opub/reports/minimum-
wage/2017/home.htm](https://www.bls.gov/opub/reports/minimum-
wage/2017/home.htm) 2\. [https://www.citylab.com/equity/2019/06/affordable-
housing-mi...](https://www.citylab.com/equity/2019/06/affordable-housing-
minimum-wage-rent-apartment-house-rental/592024/)

------
dehrmann
Is this a Facebook-specific problem, or are most Bay Area food service workers
in a similar situation?

~~~
cheeze
This is not a Facebook specific problem, but FB is easy to pick on because
they are sitting on so much cash.

But I agree, you could replace FB with almost any company down there.

Shit, I'd be willing to bet that line cook at FB pays quite a bit more than
fast food, etc.

~~~
dehrmann
> FB is easy to pick on because they are sitting on so much cash.

It's also popular to pick on FB these days.

------
sct202
I was kind of shocked when I saw the $23/hr, because that's a pretty high wage
for a line cook. Like I could not imagine anywhere else except for maybe NYC
where a line cook would protest with that rate.

According to the MIT Living Wage Calculator, he would be able to support
himself on that but it'd be difficult if he had any dependents.
[http://livingwage.mit.edu/metros/41860](http://livingwage.mit.edu/metros/41860)

------
conanbatt
Its quite daunting that the employees find it easier to compel facebook to
increase their salaries, maybe 10%, than to complain on city hall that puts
the rules that made their rent 300% of what they were.

~~~
closeparen
At ~500k/unit, neither municipal nor state government can afford to build
public housing in any meaningful quantity. We just had a huge electoral battle
over a measure that raises taxes for only a few thousand units (Prop C).
Millions of them would be required. Rent control expansion is both popular and
technically doable, but would require repealing Costa-Hawkins, which survived
this year's challenge.

You will never see a left-leaning activist group representing the working
class in California support a "let the market work" sort of policy like more
for-profit development permits. Those ideas - public housing, rent control,
increased supply - are pretty much _the_ policy levers, and none are going to
happen at scale within this set of voter preferences.

~~~
ska
>You will never see a left-leaning activist group representing the working
class in California advocate for a market-based solution like permitting more
for-profit development.

Is that really true? Elsewhere I have seen left-leaning activists advocate for
higher density for-profit development housing so long as it is zoned to force
developers to target all income groups in some manner, not just the most short
term profitable ones. Is it really so different in California? You don't have
to have a completely free market to have market based solution, after all.
Which is a good thing as you're unlikely to ever see a truly free market
there.

~~~
whatshisface
Developers could target low income housing by building a bunch of megacondos
to suck programmers out of the old neighborhoods.

~~~
closeparen
They call this “trickle down” and oppose it pretty strongly.

------
dfxm12
On an economical level, what's a better solution? Facebook paying their
kitchen staff more (than the current $23/hr), or SF taking steps to lower its
cost of living so that "one job should be enough" to get by on minimum wage
(currently $15/hr)? Or something else?

~~~
traderjane
If you pay people more than the parties with the highest leverage will extract
more rent from your employees.

~~~
whatshisface
Then why do software developers have more spending money than line cooks?

~~~
conanbatt
Because the day they don't, they won't be in SF at all.

------
theshadowmonkey
Isnt this the common situation in most of Bay Area for service workers? Im in
no way associated to Facebook, but I think its a bit unfair to call them out
just to make the headline sensational. They're just another tenant in the Bay
Area.

------
docker_up
The truth is that the only way to increase wages is to protest or to quit
their jobs en masse so I support these workers protesting. The problem with
low-skilled jobs is that there's probably someone waiting to take their job at
$23/hr, but that's how the system works and unfortunately low-skilled jobs
don't have a tremendous amount of value. This is the counter argument to
allowing illegal immigrants - they are more willing to take these low-skilled
jobs and to suppress wages much longer.

------
thorwasdfasdf
Instead of creating a useless currency, Facebook should of allied itself with
20 other tech companies and created a brand new city, in the middle of
nowhere. One that was built from the ground up to be sustainable and
affordable where everyone can walk or scoot to work. A city unhindered by
zoning or burdensome regulations. Then connect it to some of the existing
cities with high speed trains or helicopter buses. It would be a win win
situation for everyone involved.

------
tempsy
I've recently reached a personal finance threshold where I'm making a
substantial return e.g. enough to live on on a relatively "low risk" mix of
index funds/stock investments. It made me realize that being in a position
where your money is "working" for you is really the starkest difference
between the rich and the poor.

------
fortran77
San Francisco city council wants to solve this problem by banning corporate
cafeterias:

[http://www.ktvu.com/news/sf-city-leaders-push-to-ban-
company...](http://www.ktvu.com/news/sf-city-leaders-push-to-ban-company-
cafeterias)

------
strooper
This housing crisis is going on for long time. I was wondering why don't these
tech giants build housing complex for their employees.

It would definitely solve a lot of issues, including controlled and balanced
housing cost for the employees, group/public transport, and above all a
vibrant community.

Is it a permit issue? Or something else?

~~~
teej
They are. Both Google and Facebook are actively working on housing
developments in the area.

[https://www.mercurynews.com/2019/02/08/facebook-unveils-
new-...](https://www.mercurynews.com/2019/02/08/facebook-unveils-new-vision-
for-big-willow-village-complex-in-menlo-park/)

[https://www.citylab.com/equity/2019/06/google-affordable-
hou...](https://www.citylab.com/equity/2019/06/google-affordable-housing-
california-real-estate-development/591991/)

------
cheeky78
When you live in a city/state that is pushing out the middle/lower classes
through increased government regulations and taxes, this is what happens.

This is not a blueprint for the rest of the US. I hope voters take notice.

