Lowwage jobs surge; housing can’t keep pace
While the recent techfed boom has made San Francisco famous for its $200,000ayear coding jobs, less attention has been paid to the lowwage jobs that have grown almost as fast as the lucrative ones.
A new city report reveals the numbers and the challenge they pose: San Francisco would need to plan for an additional 9,300 affordable housing units — three times the number of approved units in the city’s pipeline — to keep up with the rise of lowwage jobs expected over the next six years, according to a report released Wednesday from the Board of Supervisors Budget and Legislative Analyst.
With fastgrowing companies like Salesforce, Facebook and Dropbox filling office towers in San Francisco, the city added 53,320 workers earning more than $118,000 a year over the last
three years. But for nearly every wellpaying job came an $18 or $20anhour position guarding office buildings, delivering packages, driving Uber or cleaning houses.
“There is often so much emphasis on the growth of highwage jobs in the tech industry, and our housing production tends to emphasize the highwage people,” said Fred Brousseau, an analyst with the Budget Analyst’s office. “But the highwage jobs and the lowwage jobs go hand in hand.”
From 2016 to 2018 San Francisco and San Mateo counties added 43,390 lowwage jobs, defined as an annual income below $68,800. That was an 11% increase from 2016 to 2018, driven by a 16% jump in food preparation positions, a 14% spike in cleaning and maintenance jobs, and a 13% bump in driving and transportation gigs. Of the top five fastestgrowing occupations, only one — software developer — pays more than $20 an hour. Software developers earn a median hourly wage of $67.39, according to the report.
But San Francisco clearly didn’t produce enough housing to keep up with the explosion of jobs. The city built only 12,096 homes from 2016 to 2018. Even though the lion’s share of those apartments and condos were for highincome people, it didn’t come close to matching the number of highwage jobs, and lowincome workers fared even worse with only 974 affordable homes created during that period.
The report, which was requested by Supervisor Gordon Mar, was seized upon by the Council of Community Housing Organizations — an affordable housing and tenants rights industry group — as evidence that the city should be focusing housing policy on lowwage workers and less on marketrate housing. Of the 8,500 units now under construction, 4,361 are market rate and 2,621 are affordable. But more affordable homes may be on the way. Voters will weigh in next month on a $600 million affordable housing bond, which, if passed, would generate 2,800 units of affordable housing.
The report shows the city should look at the types of jobs being created, how much they pay, and what kind of housing the workers filling those jobs can afford, representatives of the council said. Otherwise more and more workers will have to commute from farther afield.
“The policy question is: How do we house these workers or do we assume they will just commute from Antioch?” said said council Codirector Fernando Marti.
Conny Ford, a board member with Jobs with Justice, said the report “refutes all arguments that we need to build more housing for people of all income levels,” arguing that current construction is meeting the needs of “higher wage workers, but there is a clear and severe shortage for our city’s low and middlewage workers.”
Jobs and housing balance — a cause championed by the prohousing YIMBY movement — has increasingly become part of the city’s planning conversation. Planners made some lastminute changes to the Central SoMa neighborhood rezoning, for example, after critics complained that the techheavy plan would exacerbate the housing crisis by creating far more jobs than housing units. But the discussion has generally focused on total jobs and total homes, without considering how much the jobs pay or how much the units cost to rent or buy. In contrast, the new report looks at jobshousing “fit” to determine if the employment opportunities are in sync with housing costs.
Todd David, executive director of the Housing Action Coalition, which advocates for market rate and affordable housing, rejected the idea that the city is producing enough marketrate housing. He said 30 years of underproduction of housing has driven out much of the city’s middle class, and many more units need to be added to the city’s housing stock before prices start coming down.
“I don’t think pitting housing needs against each other is helpful,” he said. “If we were over building marketrate housing we would be seeing a significant dip in rents and a glut of empty units and that is not what we are seeing.”
David said the city continues to invest in affordable housing but that “a bunch of that affordable housing funding comes from marketrate housing.” Marketrate developers are required to either pay fees to subsidize affordable projects or include those units in their projects.
“It seems like these people hate marketrate housing more than they love affordable housing,” he said.
The report comes as the Board of Supervisors is gearing up to vote on increasing the jobshousing linkage fee, a tax that office building developers pay to help offset the demand for affordable housing. The measure, which will be introduced next week to the Board of Supervisors Land Use and Transportation Committee, would raise the current fee for most new commercial space to $69.60 per square foot from $28.57.
Lowwage workers interviewed said they are well aware both of the explosion of service jobs and the housing crunch, which makes living in the Bay Area so tough.
Jerry Longoria, a security guard at a South of Market office building, earns $18.65 an hour. For 16 years he has lived in a singleroomoccupancy building on Mission Street.
“I’ve been doing security for 18 years, and I can’t get ahead,” he said. “Once I pay for rent, cell phone, Clipper card and groceries, I have nothing left. I asked my boss for a raise, and she said I was being inappropriate.”
Steve Gregg, an Uber driver who said he has logged 15,000 rides for the service, said his income from driving has plummeted since he first started. After paying $200 a week for gas, he ends up with about $700 a week.
No longer able to afford the room he was renting in Castro Valley, a friend offered him a room in Antioch for $650 a month. Most of his friends who drive for Uber commute from Sacramento. Many of them sleep in their cars between shifts. “I am getting by on $600 a week. I don’t have a life. All I do is work.”
From 2016 to 2018, the number of drivers — a category includes package delivery and appbased services like Uber — jumped by 9,520 to 61,770 in San Francisco and San Mateo counties.
Mar said that he is working on legislation that will require a jobshousing balance report every year “so that we can more effectively manage growth in the city.”
“The policy question is: How do we house these workers or do we assume they will just commute from Antioch?”
Fernando Marti, Council of Community Housing Organizations