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News From Silicon Valley's Neighborhoods

Employees want more out of service-sector jobs than employers can offer Willow Glen--Some Willow Glen businesses are selling more than just their unique products and services these days. They're also selling jobs--but no one seems to be buying. "The unemployment rate is so low, no one's looking for jobs," said Terry Plaisted, manager of Victoria's Dance-Theatrical Supply. Plaisted said he's worked at the store on Lincoln Avenue for 16 years, and the past months have been the "the worst it's ever been. We've always been able to find some people. But it's been real touch and go." Willow Glen's business district is not immune to the effects of the economic boom and ever-increasing demand for workers in the high-tech sector. There are so many jobs available, employers are competing among themselves for the best workers. Retail and service-oriented businesses that can't offer high wages, short hours and big perks are left scrambling to keep their operations running. As of July 1, the White Dove Cafe had to close on Sundays because the restaurant couldn't hire enough people to cover the day's shifts. Other employers, who did not want to be named, said that they have lost potential workers to dotcom companies that were able pay twice as much. Turnover is rapid, and owners say they feel lucky to keep an employee for a week, much less get them to show up for the first day of work. With so many jobs going unfilled, employers are working harder and spending more to hire workers. In many cases, the employees they can find are less qualified and require more training. Customers end up paying higher prices and putting up with less service. "It's absolutely universal," said Steve Tedesco, president of the San Jose Silicon Valley Chamber of Commerce. "I think every business is having trouble. We're basically at negative unemployment right now. High-tech jobs are going unfilled. Everybody and more could have a job." According to California's Employment Development Department, the unemployment rate for the city of San Jose was 2.3 percent in August, and in Santa Clara County it was 2.0 percent. The unemployment rate for San Jose was 3.6 percent in August of last year. "Santa Clara County is the third lowest of 58 counties in the state in terms of unemployment," said Ruth Kavanagh of the Employment Development Department. She says reasons for this include the county's wide variety of operating industries, high education levels and sky-high housing costs. She also said that this is a nationwide phenomenon, and not just located here in Silicon Valley. Unemployment is at 4.2 percent nationwide. But the unemployment rate here is particularly low. "It is very low right now, not just low," she said. "This is the lowest unemployment rate in many, many years." California had a rate of 5.1 percent for August. Independent stores along Lincoln Avenue say they can't provide what most Silicon Valley workers are looking for in a job. "We don't have stock options. We don't have IPOs," said Dave Bertucelli, owner of La Villa Italian delicatessen. Jeff Michel, owner of the White Dove Cafe, agreed. "I can't offer Las Vegas weekend packages and $600 bonuses if you stay six months. I have 10 employees, and that would be $6,000." Plaisted of Victoria's Dance said that in six weeks he hired eight people who would work for one day before leaving, if they even showed up at all. It isn't easy for retail workers to live on their salaries in this valley. One employee, who asked to remain anonymous, said, "I can't afford what I sell. There are times when I wonder why I do this." The employee is working two jobs, and said, "I'm still at poverty level. You have to sacrifice living the high life for enjoying what you're doing." There are those who don't want to work in the high-tech industries and choose service-oriented professions. And they are even willing to make sacrifices. Michel said, "I had one girl come in. She did not have any experience as a line cook, and she offered to come in and volunteer to break into the job market." Michel said he is trying to find a way to hire her with pay. "Someone with that type of drive, it's quite commendable." Stores that specialize in service want to offer their customers the most qualified help they can. "You're only as good as your employees," said Bertucelli. The lack of qualified workers affects the quality of service businesses can provide. "Businesses are going to struggle to keep their quality up," said Tedesco. "This really is a quality issue." The difficulty in hiring enough qualified workers makes many businesses short-staffed. "It makes things more self-serve," said Plaisted. "We really try to give people good service. But when you don't have as many workers, we can seem a little short." Plaisted also said that he doesn't have enough time to do other tasks, because he is so busy doing jobs that he would normally hire out. "It's made it really hard to plan for growth," he said. Tedesco said, "It's an employees' market for people with skills. In some ways, small businesses are selling to potential employees. We're literally all out shopping for employees." Employers are getting more creative at finding workers. A classified ad and a sign in the window are no longer enough. Now, employers are asking around for people who may want to work and being more flexible about scheduling around workers needs. And they are using some services that the government offers to help businesses find employees that will work for them. Russ Bell, manager of The Glen, said, "If you're looking for quality, it narrows the availability of those kind of people. So we look a little harder and train a lot more." Tedesco said that businesses cut back hours because they don't want to provide customers with poor quality service. "I think this economy is going to continue growing. Everybody is kind of reaching down." He said that this means that the customer market is going to continue to grow. And, ultimately, the costs of raising salaries get passed on to customers. Bertucelli says he's almost doubled his payroll amount in order to attract workers, but he hasn't raised prices. Yet. "People want the same prices and the same service. The general public is going to have to cough it up. All prices are going to have to go up so we can pay people what they need." Tedesco said that business owners are having to be more flexible in accommodating the people they do hire. In addition to hiring more young people, he said, "Older people is where you've got to go market and work around their schedules." "The challenge is training and then really taking good care of your people," said Bell of The Glen. "You need to accommodate their needs and build their loyalty. Loyalty has to be won by businesses these days." Bertucelli wants the government to do something to help small businesses get the workers they need. "I think the city should have a plan. They've got to help all retailers, anyone who's not in the electronics industry." Caljobs is a program that has been offered to California employers and job seekers for about two years. It coordinates an Internet database of job listings and another of resumes, and functions as a "matchmaker" between the two. B.J. Sims, manager of the Campbell Caljobs office, said that the three offices in Santa Clara County average a total of about 300 new job listings a day, and last year almost 2 million jobs were listed. They don't keep records for how many of those jobs were filled through the Caljobs program, although they may have as many as 200 job seekers in their office on a busy day. "There are a lot of jobs available, but not a lot of people out there looking for them," Sims said. "They hear about these wonderful dotcom jobs. Everyone's competing for these Cisco jobs that will make them a millionaire." However, she also said the technical and professional jobs can be the ones that are the most difficult to fill. "Employers are into the cheapest possible recruiting methods," she said. "They pay for this service already in payroll taxes; there's no fee for job seekers or employers. We have just so many employers, you cannot believe it." Fernando Valcarcel is the manager of Employment Connection, a free program offered by Santa Clara County to help businesses recruit employees. Unlike Caljobs, which is Internet-based, Employment Connection works directly with businesses to help them better compete in the tough job market. "We meet with employers and identify their hiring needs," said Valcarcel. "If we don't have a service that meets their needs, we help employers explore options to be more competitive." Tedesco said that consumers can expect more franchise operations, instead of independent stores, because of the competition for workers and the rising wages. The larger chains will be able to continue to provide products and services more competitively than independent businesses. He suggested that independents use the Internet--ironically, one of the sirens calling away service-sector employees. Kate Carter [ San Jose | Metroactive Central | Archives ]