The COVID-19 pandemic is exacerbating wealth and racial inequalities around the world. Nowhere is that more apparent than in San Francisco.
While many low-income employees in the service sector have been laid off or risk getting sick if they do go to work, the city’s high-paid tech workers have been mostly shielded.
The engineers and product managers who helped push up the cost of living in the area over the past 15 years are not nearly as affected by the pandemic, with companies such as Alphabet Inc and Facebook Inc giving them cash bonuses to upgrade their home offices and organizing virtual yoga sessions to help them stay fit.
Most tech employees are not worried about getting fired and the mostly digital nature of software work means they can safely do their jobs from home. Many have even left the Bay Area completely.
To help staff cope while working remotely, companies are rolling out perks. Salesforce.com Inc recently sponsored a virtual talent show and is running a week-long “adventurers club” to entertain workers’ kids while they are stuck at home, in addition to providing benefits such as six additional weeks of parental leave. Microsoft Corp is also offering parents extra leave time amid school and camp closings.
At the same time, service industry workers, such as Joe Grandov, who has a part-time security job at San Francisco International Airport, are struggling.
Grandov, 65, said that his hours have been cut by up to 20 a week since the pandemic began, because he has not been able to pick up overtime shifts.
He also used to earn extra money driving for Lyft Inc, but said he had to stop, because he was making as little as US$35 a week, hardly enough to justify the health risks the gig posed.
Business travel has come to a halt, which is hurting jobs like his that depend on a lively tech sector.
“It’s not been easy,” said Grandov, who is a member of the airport’s local union. “We’ve been selling things we don’t need, because we need the money more.”
The divide between the tech and service industry is compounding the income disparities that have plagued the Bay Area for years. Since January, earnings among low-income workers in San Francisco County have fallen 52.1 percent, among the highest in California, according to data from Opportunity Insights, a Harvard University research lab.
“The service sector already had stagnating wages, then you introduce a pandemic, and it becomes not just an income gap, but a stark divide between those who will survive versus those who can’t,” said Russell Hancock, chief executive officer of Joint Venture Silicon Valley, a nonprofit that analyzes the region’s economy.
The changes cut across racial lines too, deepening inequalities between white and non-white workers in the area. More than 30 percent of the Bay Area is black or Latino, according to the Bay Area Equity Atlas. Fewer than 10 percent of Facebook and Google staff are black or Latino, according to the companies’ latest diversity reports.
The inequalities extend to the virus impact: In San Francisco, Hispanic and Latino people make up 50 percent of cases and about 15 percent of the population. In Santa Clara County, Latinos are 47 percent of cases and 26 percent of the population.
Some of the companies boosting perks for their employees are also acting to address economic and racial inequities. Salesforce is adding diversity recruiters and spending US$200 million on organizations that are working to advance racial equality, and pledged to “advocate at federal, state and local levels for policies to address the equity gap, exacerbated by COVID-19.”
The effects of low-income job losses are already weighing on workers, South San Francisco Mayor Richard Garbarino said.
While the city of about 68,000 has not had major food insecurity issues in the past, it recently partnered with a food bank to distribute 750 meal boxes a week.
The pandemic has hit low-income families the hardest, because they often rely on multiple part-time jobs, Garbarino said.
San Francisco’s economy might face even more challenges the longer tech employees stay home. Google and Facebook have told their staff to prepare to work remotely until next year. Twitter Inc has said anyone who wants to can work from home forever.
“Restaurant and service workers are currently paid really well, because they’re supported by big companies. When they take their work away, or those jobs away, that ripples through the rest of the economy,” San Francisco Chamber of Commerce public policy director Jay Cheng said. If that happens, “San Francisco is no longer going to be able to be the golden child of the United States economy.”
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