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Small businesses hit hard by strike

Mardy Sitzer hired a van to make several trips back and forth from the outer boroughs to pick up her employees and bring them to her small printing and packaging business, at 18th Street and First Avenue, and then take others home.

That'll cost Sitzer $250 a day -- which isn't peanuts for her company, called Backofficenyc. But Sitzer had a bigger problem: a lack of customers and no deliveries of packages on what should be her busiest day of the year.

Sitzer, who started the business on Sept. 11, 2001, and was finally beginning to see improvement, said a long strike could be enough to shut her down. "It's not just an inconvenience," she said. "It's an economic disaster for some of us."

As business owners and employees alike began to endure a transit strike without an end in sight, they started to tally the damage -- and it's not pretty. Tuesday alone cost the city $400 million, according to city Comptroller William C. Thompson Jr. If it lasts through the weekend, it will cost the city $1 billion more.

But while those numbers seem huge, they're not destructive to a city economy that produces more than $2 billion a day in output, according to Mark Zandi, the chief economist of Moody's Economy.com, who analyzed the strike's potential impact for Newsday. "It's measurable but very manageable," Zandi said. "But the strike has to come to an end, or the costs will mount."

Zandi said a turning point would come if the strike stretches into January.

The impact on Long Island is more difficult to quantify, but certainly not as negative. If Long Islanders stay home, they may shop in local malls and eat at area restaurants. That could help the Island's economy, said Pearl Kamer, the chief economist of the Long Island Association. A longer strike could be a negative, she added.

Most large city companies seemed to have the situation under control yesterday, with contingency plans ready to go, said Kathryn S. Wylde, the president and chief executive of the Partnership for New York City, a business group. It's the smaller businesses that were hurting most, she added.

For now, the strike certainly isn't helping Ester Horowitz. The sole proprieter of M2Power, Inc., a Merrick small business counseling firm, Horowitz said she lost $10,000 as of early Tuesday, and expects more to come, especially since she's trying to expand to Manhattan.

For them, the end of the transit shutdown can't come soon enough. "This is our homestretch and this is when we do a very large portion of our business," said Kip Veasey, the co-owner of Our Name is Mud, a pottery retailer and wholesaler.

Our Name is Mud, which has four stores and several holiday season booths throughout Manhattan, had seen a 30 percent decline in sales last weekend, just because of the threat of a strike, Veasey said.

As of Tuesday afternoon, the retailer saw a stunning 75 percent drop in sales compared with Monday. "It's a little disheartening in a big way," she said. "It's truly awful."

Retailers could lose about 19 percent of their daily output, according to Zandi's analysis. The entertainment, restaurant and tourism industries will face a 25 percent loss, Zandi said.

The primary impact of a strike will occur in Manhattan, according to Rae Rosen, the senior regional economist for the Federal Reserve Bank of New York, because that's where most commuters end up.

But the outer boroughs aren't spared. Agape Blends, a cafe in the shadow of the Jamaica subway and commuter rail hub, saw half its usual commuter clientele Tuesday morning, as everyone either stayed home or rushed past the cafe to catch their trains, said co-owner Charlotte Worsley.

In small consolation, Agape got some new business, too: a catering order for coffee and cookies for the reporters gathered outside the train station

Copyright © 2015, Los Angeles Times
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