MTA Strike Derails Business

October was supposed to be a good month for Leticia Bucio.

The hair salon she opened in September on Broadway in downtown Los Angeles was steadily developing a customer base, and a mention in a downtown newspaper gave a sense of validation to the investment she knew was risky in weak economic times.

Then the buses stopped rolling.

“And look at what happened,” Bucio said, standing in her empty Letty’s Beauty Parlour, where not a single customer had come in since the opening hour. “Now this comes. My God, I don’t even know how I am going to pay the rent.”

From little businesses such as Bucio’s to the massive Hollywood & Highland shopping center and the freshly painted shops along the path of the Gold Line in Pasadena, the 3-week-old strike against the Metropolitan Transportation Authority has stranded profits along with the 400,000 commuters who normally take the agency’s trains and buses every day.

Among the hardest hit areas are the business corridors along Broadway downtown, where Bucio has her shop, on Pacific Boulevard in Huntington Park, and in parts of Panorama City in the San Fernando Valley -- areas where customers as well as employees depend on public transportation. But businesses across the city are feeling the pain.

At Starline Tours in Hollywood, business is down and complaints are up, said Liz Badros, director of marketing and sales for the company that specializes in tours of stars’ homes.

She said Starline has been broadsided on two fronts: Some customers can’t get to the tour line’s Hollywood offices, and those who do find that the strike has severely increased traffic, causing tours to start and finish late. “We’re getting a lot of complaints,” Badros said. “People are on very tight schedules.”

On Wednesday, Badros was trying hard to retain the business of a group of Florida travel agents who had come to Los Angeles to try out the amenities they sell back home.

The 15 agents had planned to take the Red Line subway on Sunday from their downtown hotel to the tour company’s Hollywood offices. Instead, barring a quick conclusion to the strike, they may have to charter a bus to pick them up at their hotel, which would increase the cost of their tour by $100 to $400.

“We’re trying to work with them because they do sell L.A. and it could impact everybody negatively if they can’t take the tour,” Badros said.

At Hollywood & Highland, the $600-million retail development that sits atop a Red Line station, conventioneers whose hotel packages included subway tickets have had to find new -- and more expensive -- ways to get to their downtown meetings.

Jon Harger, 43, of State Center, Iowa, was in town for a national wastewater convention when the strike began last month.

Harger, who sells water reclamation equipment, was staying at the Renaissance Hollywood Hotel at Hollywood & Highland, and riding the subway to the Los Angeles Convention Center downtown.

But when the strike started, he said, he and other business travelers staying at the hotel were forced to rent cars or take taxis. “We wouldn’t have stayed out here if we’d thought there would be a strike,” Harger said.

Business is down at Hollywood & Highland’s upscale Sephora cosmetics store, said manager Ana Martinez, and the company has had to provide transportation for two employees who work at night and have no way to get home.

It is too soon for economists to put a precise figure on the financial impact of the strike.

Using data gathered during the last transit strike in 2000, the MTA predicted that the region would lose about $4 million a day in the current work stoppage.

But those numbers are hard to verify. And even when the data come in for this last quarter of 2003, it will be far more difficult to judge the economic impact of the strike than, say, the financial bite of the recent wildfires.

“In the case of the fires, you can take the number of houses and multiply it by rebuilding costs, but here it’s much more subtle and difficult to measure,” said Lisa Grobar, professor of economics at Cal State Long Beach. “It’s one thing to say we’ve got to rebuild 2,000 houses, but it’s another thing to judge to what extent people are able to find substitute transportation.”

Some businesses -- particularly the tourist-oriented stores and restaurants around Hollywood & Highland -- have seasonal declines in patronage, and it’s hard to tell how much the strike is to blame.

Still, the anecdotal evidence is piling up.

Traffic is measurably worse, a 4% increase in cars and trucks that the Los Angeles Department of Transportation says is enough to clog the roadways.

Barbara Levine, a regional manager for the Los Angeles County Economic Development Corp., said she worked for a year to entice ALT Group, a garment-industry concern based in Germany, to locate a business here.

The company’s commitment to settle in South Gate survived a wave of civic scandals, along with the rocky California economy.

But the transit strike grounded the firm’s plans for hiring 80 workers to put the finishing touches on its textile products, Levine said.

“They’ve put off hiring,” she said. “They can’t find routes for people to come to work.”

“If you ask the profile of businesses most likely to be hurt by the strike, it is absolutely those who cater to people who are dependent on the transit system,” said Alec Levenson, a labor economist at the Center for Effective Organizations at USC.

Along Pacific Boulevard in Huntington Park is a 10-block stretch of discount shops, small stores serving the Latino community and clothing outlets.

Most customers there take the bus -- or, at least, they used to.

“It’s going to be difficult to pay the rent this month,” said Carmen Mujica, owner of Mujica’s Botanica San Jose, a tiny shop full of candles, herbal medicines, cigars and flowers.

“I hope this gets resolved soon,” Mujica said. “Everyone here thinks this is fatal for us.”

Annie Hong, who opened a clothing outlet on Pacific just a week before the strike began, has taken to picking up customers in her car and driving them back home again.

“If the bus doesn’t come, no one comes,” she said

Across the economic divide from Huntington Park, the Holly Street Village Apartments in Old Pasadena are shiny and new, built in the mid-1990s in hopes that the Gold Line light railway would help draw tenants to the rental units and customers to the ground-floor stores.

When the trains began running in July, business really popped.

Lynn Beria opened her Arete salon at Holly Street Village four years ago in anticipation of the Gold Line’s completion. In the first two months after the line opened, she signed up 245 new customers.

But over the last three weeks, she said, “there’s been a complete drop-off.”

It’s the same story at the cafe next door, which gained new regulars after the Gold Line opened, only to see them vanish during the strike.

“I’m not seeing the guys who were coming before,” said Amanda Gerhart, working the counter on Wednesday.

“It’s a bummer,” she said. “I used to take the train too.”

Times staff writer Jean-Paul Renaud contributed to this report.