ECONOMY
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‘Underground’ Businesses Upbraided at Meeting: California’s burgeoning underground economy, consisting of unlicensed businesses or those that pay cash to workers and evade taxes and workers’ compensation premiums, has grown to a $60-billion phenomenon, or almost 7% of the state’s total gross domestic product, costing the state about $3 billion in tax money a year, according to testimony at a state Senate committee hearing in Los Angeles. At an informational hearing of the Senate Committee on Industrial Relations, senators also heard from legitimate construction industry contractors who argued that such underground firms are underbidding them routinely and threatening to drive them out of business.
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