Service Crunch Sends Firms on Search-and-Employ Mission
In a recruitment push unprecedented in its 45-year history, Disneyland is paying its staff as much as $500 to round up new employees--more than a week’s wages for most park workers.
At the nearby Orange County School of Culinary Arts, restaurants are snapping up graduates as soon as their training is over.
And at a recent gathering sponsored by Anaheim’s hotel association, the talk was not only of boosting pay and benefits, but of busing in help from faraway places.
Although tourist centers throughout the nation are begging for service workers, the scramble figures to become particularly intense in Anaheim, which is gearing up for a huge expansion of attractions, hotels and restaurants.
With a new Disney theme park scheduled to open next year and other major projects under construction or on drawing boards, employers will be hiring thousands of workers--just as the county experiences its tightest labor market in history and record housing prices that are driving lower-paid workers out of the area in search of affordable homes.
Disneyland, for example, will add 5,000 jobs in the next year for its new park, another hotel and a major retail/entertainment zone in a move to encourage tourists to stay several days. Other major developments--an expanded convention center as well as several proposed hotel, retail and entertainment projects--could create 10,000 additional jobs in the coming years, city and tourism officials say.
But where will they get the workers? With national unemployment at 4% and Orange County at half that rate, nearly every business is facing a dwindling pool of workers willing to fill traditionally low-paid service jobs.
“You’re going to see it become very, very difficult to attract the type of quality workers Anaheim has had in the past,” says H. Edwin Buffkin, western regional manager for the company that runs the Quality Hotel Maingate near the city’s convention center.
Indeed, finding talented employees ranks as one of the biggest concerns of Walt Disney Attractions’ president, Paul S. Pressler, who led the expansion planning.
The competition for workers already has provoked drastic recruiting measures in other booming tourist centers across the nation.
In Orlando, Fla., where the jobless rate is under 3%, airwaves are filled with ads for hotel and theme-park help, and Walt Disney World sends emissaries to Puerto Rico in search of full-time workers. Disney also is recruiting part-time workers at colleges around the nation, and even has built apartments for 3,200 college-student workers.
In Las Vegas, mega-resorts have boosted wages for housekeeping work to more than $10 an hour, and one company with four casinos is building 24-hour day-care centers for workers’ children. Stories of waiters making $100,000 a year in exclusive restaurants have been added to the urban lore in the desert gambling and entertainment center.
But the recruiting challenges seem particularly daunting in Anaheim. Higher wages and cheap housing in other areas, along with an abundance of job openings nearby, present far more alternatives for entry-level workers than in the past.
And the local economy’s surging technology segment has helped create prosperity that has made home prices and rents here among the nation’s highest. The $132,000 it takes to buy the typical condo within 15 miles of Disneyland, for example, would cover the purchase of a typical single-family home in Las Vegas.
No wonder, then, that industry executives are contemplating the kinds of actions already taken in Nevada and Florida, such as bumping up wages, increasing benefits and busing in workers.
Many Disney World workers, for example, receive higher pay in a much cheaper housing market than Orange County. Pay for dishwashers at Disney in Orlando tops out at $10.43 an hour compared with about $8 at the Disneyland Hotel or the Hilton Anaheim, union leaders say.
The gap is even bigger in Las Vegas, which lures workers from around the country with the promise of an easier time making ends meet.
It’s not uncommon for casino dealers to earn $60,000 a year and servers in top restaurants to make $50,000 to $100,000, says Arthur “Arte” Nathan, vice president of human resources at the Bellagio resort in Las Vegas
More important, he says, many workers holding down low-skilled jobs find $85,000 starter homes within their reach in Las Vegas, where there is no state income tax.
“You figure a maid makes $10.35 an hour at the union hotels. That’s not bad. You can start to raise a family and save money when you get over $10 an hour,” Nathan says.
Maids make less than $8 an hour in Anaheim.
Nathan’s hotel and others on the Strip operate under union contracts requiring them to pay the premiums for full family medical coverage for workers including maids, porters and kitchen workers. In Anaheim, only the Disneyland Hotel, the Hilton Anaheim and the WestCoast Anaheim Hotel offer similar no-cost health plans, union officials say.
Some nonunion operations in Las Vegas provide more elaborate benefits. Station Casinos Inc., which operates four Las Vegas-area gambling halls, is building round-the-clock child-care centers for workers, in addition to offering health and retirement plans comparable to union hotels.
Station Casinos also provides a legal-services plan in which employees pay a flat $14 a month for access to lawyers who draft wills, help them adopt children and even handle traffic-violation cases. Next month, it will roll out a program offering discounts and special deals on 20 categories of products and services from oil changes to pets, negotiated with local merchants by the company.
And workers are flocking to the area. In the last three years alone, 231,878 people traded out-of-state driver’s licenses for Nevada licenses issued in Clark County. More than a third of the arrivals are from California.
If the wage and benefit disparities pull enough workers away from Southern California, local hospitality employers will be pressured to raise their wages and benefits, says Esmael Adibi, director of Chapman University’s Anderson Center for Economic Research.
“I run into people all the time who tell me they can’t get good employees,” he says. “What they really mean is they can’t get good employees for what they’re offering.”
Still, he thinks that Disney’s appeal will help it find recent high school graduates and college students to happily work at the company’s parks and hotels before moving on to better jobs or moving up in the company’s hierarchy.
Local businesses already are seeing the hiring pressures build.
“Every single day we get faxes from the Hilton, the Hyatt, Disneyland, restaurants down in Rancho Santa Margarita, all looking for qualified cooks,” says Danny Escandon, manager of the Orange County School of Culinary Arts, a state-funded vocational cooking school in Fullerton. “The minute our students see the faxes [and apply], 90% get hired.”
But getting hired and getting ahead are two different things. Despite heavy demand for cooks, even well-trained ones start at well under $20,000 a year, largely because waves of immigration have kept wages down over the years.
Twenty years after immigrating from Mexico City, four years after becoming a Disneyland Pacific Hotel cook, Armando Rojo is a union shop steward making $10.56 an hour--top scale, but not nearly enough to realize his dreams.
Rojo, 37, who lives with his wife and five children in a one-bedroom Fullerton apartment to save money, moonlights an additional 25 to 30 hours a week at the Sun Theatre, a live music and dining venue in Anaheim.
The extra job brings his total pay to about $700 a week--enough for the $500 monthly rent, making sure his kids get to play soccer, and saving a little--but not enough to buy a house in a good area, he says.
“If I can’t do it here, I’m going to Las Vegas,” says Rojo, estimating he could improve his wages by more than 50%. “They’ve got better pay for the cooks there, and there’s lots of work.”
Despite such talk, Disney says it expects no major difficulties filling the 5,000 mostly part-time positions it will need next year, when it opens its new California Adventure theme park, Grand Californian luxury hotel, and Downtown Disney entertainment and shopping zone. Current Disney employment in Anaheim is 12,000, rising to 15,000 in the summer.
“We take in a five-county area in searching for our cast members, all the way to north San Diego County. It’s vast,” says Disney spokesman Ray Gomez. Workers willing to commute further can find more affordable housing farther inland in such places as San Bernardino and Riverside counties, he says.
The Anaheim job crunch may be eased somewhat because many hotel and retail projects have been stalled by lack of financing and concern over low room occupancy rates in north Orange County.
Inspired largely by the Disney and Convention Center expansions, developers tossed up proposals to build more than 12,000 Orange County hotel rooms. But just 481 rooms actually opened in the Anaheim-Garden Grove area near Disneyland last year, a study by Atlas Hospitality Group of Costa Mesa found.
And of the more than 7,500 rooms proposed in that immediate Disneyland area, only 1,300 are currently being built, including 750 by Disney.
Still, existing hotels expect some staff will move on to more promising jobs in the area.
“If I were an assistant manager here or at another convention hotel, don’t you think I’d have an eye on a manager’s job over at Disney’s Grand Californian?” says Patrick Hynes, a spokesman for Hilton Anaheim, the area’s largest hotel with 1,572 rooms.
The scramble for workers already is under way at Quality Hotel’s 284-room tower near Disneyland. Anticipating increased demand for workers, the hotel began advertising entry-level positions last fall to build up a backlog of candidates.
Buffkin, the regional manager for the hotel’s owner, Sunburst Hospitality Corp., says the list of potential maids, janitors and busboys appears adequate--for now. But he shakes his head over the prospects for finding good hotel and restaurant workers--and especially for retaining them--in the face of increased local demand and the lure of Las Vegas.
“You’re always looking down the street,” Buffkin says. “If someone starts paying an extra quarter an hour, your workers can be out the door.”
His company is considering lowering the amount employees pay for family medical coverage--the most frequent complaint in surveys of workers. But Buffkin says that at meetings of the hotel association, the talk is of more radical measures, such as busing in workers from less affluent areas--a prospect housing experts say is likely.
“We just don’t have the housing infrastructure for wage earners who earn $10 an hour or below,” says Jill Dominguez, head of the Orange County Affordable Home Ownership Alliance. “And that’s what the tourist industry pays.”
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Help Wanted
Service workers are in high demand in such tourist centers as Orange County’s Anaheim, home of Disneyland; Orlando, Fla.; and Las Vegas. All three are experiencing labor shortages, with unemployment below the national rate of 4%. A look at hotel union wages, housing costs and tourist spending:
ORANGE COUNTY
Unemployment Rate (Dec. 29): 2.1%
Single-Family Home Price (4th qtr. ‘99): $284,900
Vistor Spending: $5.9 billion (‘99)
*
LAS VEGAS
Unemployment Rate (Dec. 29): 3.6%
Single-Family Home Price (4th qtr. ‘99): $131,600
Vistor Spending: $24.6 billion (‘98)
*
ORLANDO
Unemployment Rate (Dec. 29): 2.5%
Single-Family Home Price (4th qtr. ‘99): $103,300
Vistor Spending: $17.2 billion (‘98)
TOP HOURLY SCALE IN CURRENT UNION CONTRACTS
ANAHEIM
Maid: $7.97
Dishwasher: $8.08
Cook: $10.78
*
LAS VEGAS STRIP
Maid: $10.35
Dishwasher: $10.92
Cook: $14.24
*
WALT DISNEY WORLD
Maid: $10.54
Dishwasher: $10.54
Cook: $12.27
*
Sources: Anaheim/Orange County Visitor and Convention Bureau; Orlando/Orange County Convention and Visitors Bureau; Los Angeles Convention and Visitors Bureau; Las Vegas Convention and Visitors Authority; Hotel Employees and Restaurant Employees Union; Culinary Workers Union; Walt Disney Co.; Bureau of Labor Statistics; National Assn. of Realtors
