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Photograph by Kathy De La Torre
The Los Gatos Coffee Roasting Company, a veritable icon in downtown Los Gatos, has raised prices and reduced hours in an effort to retain staff in a market that has left the service industry scrambling for employees.
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Bad Timing
Los Gatos employers do all they can to retain their employees. Are the restricted parking hours downtown working against them?By Nathan R. Huff
There was a time not so long ago when Sue Ann Van Epps, owner of the Great Bear Coffee shop, waded through two-inch stacks of job applications every month. Now, only five to 10 applications trickle in each month.
Around the corner, Los Gatos Coffee Roasting Company is closing four hours earlier on Saturdays and Sundays than it has in its 18-year history.
In newly remodeled Old Town, California Cafe managers receive regular calls from outside recruiters interested in hiring managers and experienced waiters for valley restaurants. Even when California Cafe manages to hire enough staff, the increasingly dire parking situation often pushes employees into taking more convenient jobs.
Photograph by Kathy De La Torre
Old Town employees say the Miles Avenue parking lot is too isolated and dark. The short-cut on the creek trail still leaves a long walk at night.
These are far from isolated incidents in downtown Los Gatos. A quick stroll down N. Santa Cruz or University avenues reveals countless "help wanted" and "now hiring" signs. Los Gatos' service employee shortage has been steadily worsening for the past couple of years, a small symptom of a larger problem facing Silicon Valley residents and businesses.
"It's gotten worse and worse over the eight years I've been here," Van Epps said. "Last year I cut hours for a short while, and this year I had to cut even more." While the Great Bear is now open its normal hours, for a while the coffeehouse was closing at noon on Mondays--traditionally, coffee is available until 10 p.m.
The hours when hot joe is available at the Roasting Company have also declined. Owner Teri Hope has modified her business' hours for the first time in 18 years. "To maintain a quality level of service," Hope said, "we've had to take our employee resources and use them during the peak hours and cut back on the slow hours."
The high cost of living combined with the abundant availability of jobs in high-tech fields--jobs with high salaries and competitive benefits--have created a serious vacuum in the service industry.
Town of Los Gatos Chamber of Commerce executive director Sheri Lewis said her organization is aware that the employee shortage "is an issue for our members." Lewis expects the topic to come up at the Chamber's November board meeting, but solutions to the multifaceted problem will be hard to find.
Parking Problems
Los Gatos adds its own twist to the labor shortage as well--employees are at the center of the parking crunch in Los Gatos. Businesses must respect the employees who keep their stores running, while at the same time ensuring that customers can find nearby parking.
Nowhere is the problem more acute than in the south end of downtown. In Town Lot 4, where many Old Town employees park all day, parking between 9 a.m. and 9 p.m. was scheduled to be restricted to three hours, starting Nov. 1.
The new restriction was half of a two-part proposal made by the Chamber to the Town Council. The second half--opening University Avenue in the Edelen area to limited employee parking during the holiday season--was rejected by the council after Edelen residents complained about the plan at the Oct. 1 council meeting.
Lewis and fellow Chamber members were caught off guard at the Oct. 1 meeting, and were unsure whether the time limits should be imposed without creating alternate parking areas for employees.
"It was a really tough call," Lewis said about the Chamber's decision to support the time limits. "The council had made a promise to the Edelen residents to wait until Old Town was open before reevaluating the parking situation there. We're going to be asking them to revisit that on Nov. 1."
California Cafe manager Ben Afraimi said restaurant employees just do not have the flexibility to run out and move their cars every three hours. "It's going to be impossible for an employee to run out in the cold for 10 minutes to repark their car, and still maintain the same level of customer service," Afraimi said.
Hope, who came to the Oct. 1 meeting with several of her employees to protest the time limits, later described the worsening parking situation as "yet another disincentive for employees to work in Los Gatos."
Employees of Old Town-area businesses are being asked to park in the Miles Avenue lot near the town service area. Afraimi said the long, dark walk is a little too much to ask of employees who work late into the night. He said one employee has already hired an attorney "to sue the town and Old Town if she gets mugged."
Lewis said the Los Gatos Police Department has committed to increasing nightly patrols in the area. The Chamber is also pushing the town to improve the lighting along the trail leading up to University. Lewis said employers might also have to consider scheduling their employee hours so that workers can leave in groups. The Chamber has also discussed businesses banding together to provide shuttles or escorts.
Afraimi said employees are circulating a petition protesting the lack of employee parking. Lewis said that the employees, whose presence has been missed at past council meetings, need to come to the council with specific requests.
When several of Hope's employees showed up at the Oct. 1 council meeting, they managed to convince the council not to impose the three-hour limit on Town Lot 7, a lot used by many employees of Main Street and University Avenue businesses.
Whatever is done needs to be done soon, according to Afraimi. "It's a rising concern for every downtown employee," he said. "As long as we come up with a solution, it works for me."
Help Desperately Wanted
Throwing corporate competition for both customers and employees into the mix makes it that much harder for small businesses. Van Epps mentioned that she recently came across ads in a Santa Cruz newspaper for job openings in Starbucks and Peet's Coffee in Los Gatos.
High-tech companies can take outreach one step further, and do--Oracle, Cisco Systems and Hewlett-Packard all donate large amounts of money and equipment to schools to train future employees.
Local small businesses have to be a little more creative. "Employees get a $100 bonus if they recruit someone who ends up being hired," Hope said. "Word of mouth has always worked pretty well."
Sometimes, however, competition for employees can get downright nasty. Lewis said the Chamber received several complaints over employee theft--predatory hiring practices--by local businesses. "Three or four months ago, when Old Town was staffing up, several hiring recruitment companies for Old Town businesses tried it," Lewis said. "In a small community that's very hard to take."
Afraimi said these practices are common. "I got a call this morning from a recruiter seeing if I was interested in a manager's job ... When I said no, he asked if I knew anybody else that was," Afraimi said.
While the bulk of Roasting Company and Great Bear employees are still high-school students and other local young people, Hope said, that's changing. "We used to employ almost exclusively local people," Hope said. "Now we find we have more and more employees from outside of Los Gatos."
Living on Less
One would think that all the competition for employees would at least be good for job hunters, but that's not necessarily true either.
The difficulty in finding "good help" is directly tied to the booming Silicon Valley economy. As the high-tech businesses, which face their own employee shortages, bring workers in from other areas and increase the valley's population, the demand for more services is created. However, what seems like an ideal economic opportunity for service businesses is actually a mixed blessing at best.
The influx of high-tech employees and salaries has led to skyrocketing housing costs. According to a study done by Joint Venture Silicon Valley, housing costs in the valley have leapt 30 percent in the last two years. Commuting time and cost has also increased. The end result is that those jobs which once offered an adequate--if not impressive--living wage, no longer do so. And while demand for service is up, the number of "servers" is down.
That's no surprise to Afraimi. While he said he doesn't even know how to close a file on his computer, his 13-year-old son is a computer whiz. "When my kid is 15 or 16, he's not going to be a bus boy making $10 to $12 an hour; he'll be working with computers making $15 to $20 an hour."
Van Epps and Hope both said they have increased wages to try and entice potential workers and hold on to experienced employees. But even those workers who Van Epps described as "preferring to work with people rather than behind a desk" are increasingly being drawn towards office jobs.
Their motivation is simple. "We pay well above minimum wage, in addition to tips and benefits," Hope said. "Still, it's not enough to pay the cost of living in Los Gatos."
Employee benefits have been increasing at the Roasting Company over the past five years, and now include medical, dental, and vision coverage. Hope said the primary purpose of benefits and higher wages is to hold on to the "loyal and dedicated staff that's so important to providing good customer service."
Small businesses must also make competitive offers to get new employees. As Hope pointed out, small businesses can't offer stock options and the same opportunities for advancement that larger corporations and high-tech companies can.
The recent 25-cent rise in coffee prices is just part of Hope's effort to cover rising overhead--rent and salary alone cost over $30,000 a month. Having to be constantly hiring is just another burden on the small business-owner. "People have no idea of the overhead costs, and the volume needed to meet that overhead," Hope said. "It's a lot of coffees and cappuccinos."
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Los Gatos, California Since 1881
