Prosperous Firms Prove Ungrateful Citizens, Compton Officials Complain

Each weekday morning, thousands of workers stream off the 91 Freeway here and go to jobs with some of the best-known names in business.

Xerox, Toyota, Nissan, Northrop and the headquarters for Ralphs Grocery Co. share a Compton address with more than 100 other companies in four flourishing industrial parks. There are furniture makers, electronics importers, tire distributors and computer firms, some with only a handful of employees, others with 100 or more.

“If you look at a map, it’s the exact epicenter of our operations in Southern California,” said Byron Allumbaugh, chairman of the 126-store Ralphs chain. “Plus it has wonderful freeway access. . . . The location is absolutely perfect.”

But when night falls, the vast majority of the workers file out the way they came, leaving behind one of the region’s most economically depressed cities.

“If you stand over there in the evening,” City Councilman Robert L. Adams said recently, “you can see them going on the freeway. They don’t live in this community.”

In predominantly black and increasingly Latino Compton, unemployment runs about 12.1%, more than double the most recent rate for Los Angeles County. State employment figures do not isolate the degree of black joblessness, but as chairman of a city task force on employment and labor, Adams believes it could reach as high as 40%.

So instead of viewing the businesses as a valued local resource, Adams takes offense at the influx and exodus that swirls around the manicured warehouses and manufacturing plants flanking the freeway from Long Beach to Carson.

“The firms along that 91 corridor, no, they haven’t participated (in city affairs),” Adams said sourly. “As far as hiring citizens of this community, (their record) has been very poor.”

In recent weeks, as the council has struggled to shore up slumping budget revenues and still satisfy a community demand that more police be hired to combat crime and gang violence, Adams and others have complained that major firms in the 10-square-mile city are doing little to lend a hand.

When business leaders showed up at City Hall last month and helped block what some officials considered a vital 40% increase in the utility-users tax, Councilman Floyd A. James accused the freeway firms in particular of delivering “a slap in the face” to taxpayers. The firms profit from Compton’s strategic location and municipal services, he said, without showing an equivalent concern for its economic distress.

“I think it’s time for the big corporations to start making some commitments to employing people in our community,” said James, one of several business and government leaders interviewed for this report. “It’s just good business to try to employ the unemployed in the city” where a company has operations.

“We definitely use their products,” James said. “We buy their clothes, we eat their food--and Ralphs doesn’t even have a market in the city.”

Business leaders counter that they already help keep Compton afloat by paying millions of dollars in county property taxes, some of which flow back to the city, plus millions more in utility-user taxes and a total of $950,000 in license fees.

“I’d hate to see their plight without us,” said Richard Sinclair, president of Executive Office Concepts, a maker of business furniture with headquarters along the freeway.

Ralphs, which chairman Allumbaugh said is probably the city’s largest corporate taxpayer, said the company wrote checks to the city and county last year totaling almost $1 million, of which $445,000 went directly to Compton.

“We’re paying everything that’s imposed upon us,” he said, although city officials complain that the company has fought them for years over the amount of its business license fee.

Gene Brown, public relations director for Ralphs, said the company once had a grocery in Compton at Long Beach Boulevard at Alondra Avenue, but it was closed years ago when it “just simply did not do the business” and stores around it were dying out.

Made Contributions

As far as community involvement, Allumbaugh said, “We participate in all the civic things that Compton has done.” The company has sponsored local high school students on field trips, made contributions to neighboring California State University, Dominguez Hills, and continues to be active in various food donation efforts. Brown serves on the regional board of United Way, and Allumbaugh last year served as fund-raising chairman.

And “we certainly meet all of the equal rights and fair employment” requirements, Allumbaugh continued, noting that 25% of Ralphs’ 656 headquarter employees are members of minority groups.

But executives for Ralphs and several other firms said they do not know exactly how many of their workers actually live in Compton. And that touches another sore spot.

When factory jobs are made available to local residents, business and government leaders agree, they tend to be most often filled by Latinos--despite the fact that blacks outnumber Latinos in Compton by more than 3 to 1, according to census data. Councilman Maxcy D. Filer said some employers end up playing one group against the other, in effect, by satisfying minority hiring requirements with workers who may not be among the city’s hard-core unemployed.

“When I go to a plant and I see all Hispanics I have to assume you have excluded blacks,” Filer said. “And I see quite a few plants around here that have no blacks.”

Adams said that officials from President Reagan on down now “show more interest in assisting Hispanics than blacks. My personal feeling is I think they’re catering more to Hispanics. . . . They’ve relaxed so many (immigration) laws,” said the councilman.

“They (Latinos) can come in and get various employment, while blacks are already here and can’t get employment,” Adams said.

Seen as Economics

John Quicker, a sociology professor at California State University, Dominguez Hills, said Compton is similar to other places in Los Angeles County where employers now draw from a work force made up of “migrant” as well as “indigenous” workers. When Latinos are hired over blacks, Quicker said, “my feeling is that rather than it being a case of racism, it’s likely to be a case of economics in that one group works cheaper than another.”

Most migrant Latinos come from countries where the pay is low, Quicker said, so wages here “tend to be lower for Hispanics than blacks.” Because many Latinos have been undocumented, they feel powerless to complain, whereas blacks “have a little more legal power to contest unjust treatment” because they are citizens.

James maintained that Compton blacks do not harbor ill feelings toward Latinos because “we know they’re not creating a problem being hired; it’s the person who’s doing the hiring, who is white.”

Still, some Compton Latinos say they feel resented. Raymundo Morales, president of Compton’s Latino Chamber of Commerce, notes that four of the five City Council members are black and none are Latino. “The first thing they say (to a business representative) is, ‘How many blacks have you hired?’ ” Morales said. “They don’t say, ‘How many Hispanics have you hired?’ ”

Such a question was asked by Adams when Dick Stover, vice president of Kraco Manufacturing, an auto-parts maker, appeared before the council last month to oppose the utility-users tax increase. Stover, whose 800-employee firm lies outside the freeway industrial parks, replied that he had no ready statistics.

In a recent interview, however, Stover said “about half” of Kraco’s 500 “factory workers” reside in Compton.

Few Black Applicants

“Quite honestly,” Stover said, “the majority of our factory workers are Hispanic, and that stems from the fact that when we need to hire people the word gets out” and current employees tell their friends and relatives, who then apply.

“We just don’t get many black applicants,” Stover said, although he concedes that Kraco may not be doing all it could to advertise jobs in local newspapers or make full use of government employment referral services.

“Americans don’t want to work for low wages,” Stover said. “Whereas the Hispanic worker . . . they work for us and they send their money back to Mexico or wherever.”

Stover said his company pays starting workers $3.67 an hour, slightly over the $3.35 federal minimum wage. (The state Legislature has given Gov. George Deukmejian a bill that would raise the minimum wage to $4.25. But the governor is said to favor letting his appointed Industrial Welfare Commission adjust the rate. In a tentative action earlier this month, the commission proposed making the minimum wage $4 for adults. However, full-time students under age 21--the bulk of the minimum-wage work force--would get only 5 cents more. The increases will not become law until they are approved after three more commission hearings.)

Kraco’s average worker already receives “probably somewhere between $5 and $5.50,” Stover said, as well as an “above-average” benefits package that costs the firm another 30% to 40% beyond what it pays in salaries.

“Were it not for this Hispanic work force, our costs would go up tremendously,” Stover said. “We would not be competitive and we would be going offshore (to lower-wage countries) for our work force.”

60% Are Latino

At freeway-based Scandiline Furniture Corp., which has about 55 employees, President Ajit Patel said 60% of his factory workers--especially upholsterers--are Latino.

“Certainly, I don’t think they (Compton blacks) get their fair share” of local jobs. “I personally feel that a majority (of workers) should be coming from that neighborhood, even in our own plant,” where he said the average wage is $9 an hour.

But because low-paying furniture manufacturing jobs have historically been filled by Latinos, Patel said, those workers now have more experience in the industry.

“We attempt to hire (black) people locally,” Patel said, “but unfortunately the skill level isn’t there. We get 30 or so Latino people applying and two or so black people.”

Sinclair of Executive Office Concepts blames area trade schools for not turning out more skilled woodworkers of any race. “I don’t think this is just a problem with the black community,” he said.

Sociologist Quicker said businesses need to be more attuned to “the fact that there has been structural unemployment (among blacks) in Compton that has topped 50% for years. I don’t think that--unless we address that problem--that some of these issues are going to go away,” he said.

“The businessman looks at it from a very narrow sense,” Quicker said. “He’s looking to make money. He’s not in business to provide support for the entire (body of) unemployed,” so he turns to the least costly worker.

Yet when that happens in Compton, the remaining unemployed often resort to crime, which only creates more of a community problem, Quicker said.

“I’ve talked to blacks in Compton who do deal drugs,” he explained, “and that’s what they tell me. ‘Why bust my back for the minimum wage when I can make 10 times that selling drugs?’

” . . . A lot of businessmen would take offense that their employment policies are driving people to the illegal economy, but the fact is it is,” Quicker said.

Claim of Indifference

City officials contend--and some business leaders admit--that there is widespread indifference among the freeway firms about Compton’s economic dilemma.

Kraco’s Stover was dismayed, for example, when he approached “between 30 and 40” companies and found that none were interested in actively joining his opposition to the proposed utility-users tax hike. “I was unable to interest these guys in coming out against the tax,” Stover said, even though many said they opposed it.

Others such as Dan Schrader, director of administration for Kubota Tractor, said he did not know the city was close to raising the utility tax, although it had been a highly publicized subject of City Council debate for weeks. “I did not hear about that one,” he said. “I don’t think there’s any business that wants to pay more taxes.”

Wilson Cudd, industrial relations manager of Allen Industries, an automobile seat maker, said hisfirm, which employs 100 workers, is not active in the Compton Chamber of Commerce because the group often takes on “issues that don’t directly confront us.”

At the same time, business leaders like Scandiline’s Patel say city officials do not seem to be doing much to open communication lines.

Indeed, when asked to supply basic information for this article, various city administrators either did not return repeated calls from the Times or were unable to provide data such as the amount of property taxes that businesses pay into city coffers.

Eager to Help

Officials at the Compton Chamber of Commerce were eager to help, but their only list of business members was outdated by several years and contained inaccurate or incomplete employment figures.

“I’ve never seen a city official come out here and say, ‘We’d like you to help us,’ ” Patel said. “The year that I’ve been over here (since assuming management of Scandiline), I don’t think I’ve got a letter or a phone call from any city official. They have to actively pursue this. We are willing to cooperate.”

Councilman Filer said the city operates a federally subsidized job training program that has some contact with major employers. But “we could do much, much more” to “go out and let these companies know” that more residents need jobs.

“I don’t know what more we can do in terms of communication,” Councilman James said. “If we call a meeting with them, we don’t get the response we need” unless the subject involves police security.

“They are in Compton,” James continued, “and they are part of it. . . . Everyone should make an effort to take care of it.”