Where are all the workers? Part V

Wages are the disease while housing is the symptom

By Zach Hagadone and Lyndsie Kiebert-Carey
Reader Staff

This article is the fifth and final piece in an ongoing series during which the Reader has examined various aspects of the labor shortage affecting area employers. Part I was published Sept. 16, Part II on Sept. 23, Part III on Sept. 30 and Part IV on Oct. 14. Find the entire series on sandpointreader.com.

When Danya Rumore looks across the communities of the Mountain West she sees a “probletunity” — that is, a problem and an opportunity posed by the crush of in-migration from high-wage coastal and inland urban centers to rural, amenity-rich areas, including her hometown of Sandpoint.

“It’s a terrible place; no one wants to live there,” she joked at a meeting of the Idaho Chapter of the American Association of Planners, which took place virtually from Oct. 6-8 and drew experts from throughout the state.

Rumore is a professor of law and planning at the University of Utah, director of the Environmental Dispute Resolution Program, and founder and co-director of the Gateway and Natural Amenity Region (GNAR) Initiative. In those capacities, she delivered the keynote address at the recent conference, keying in on “big city problems in small rural towns,” which have only grown more complex amid the upheaval spurred by the COVID-19 pandemic.

Minimum wage earners such as fast food employees are some of the hardest hit by workforce housing shortages. Courtesy photo.

GNAR communities have between 150 and 25,000 residents; are located within 10 miles of a national park, state park, national forest, lake, scenic river, ski resort or other such natural amenity; and are further than 15 miles from an urbanized area. Based on that definition, Rumore said there are more than 1,500 GNAR communities nationwide, including 811 incorporated cities and 701 Census-designated places. More than 30% of those communities are in the Mountain West.

“We’re talking about a significant chunk of the Mountain West,” she said, noting that Sandpoint, McCall and Salmon are all considered Idaho GNAR communities, as well as Jackson Hole, Wyo.; Tahoe, Calif.; Park City, Utah; and Moab, Utah.

All of them have been especially vulnerable to sweeping social and economic changes that have been occurring for the past two decades, but proceeded as if on “steroids” over the past 20 months. Quoting from a colleague, Rumore said, “COVID-19 expedited amenity migration to the rural west by 15 years. … That’s really hard to plan for.”

In her work with the GNAR Initiative, Rumore has conducted extensive research and surveys with designated communities, isolating the top concerns facing them all — top of the list being affordability and availability of housing, and the second being average wages compared to the cost of that housing.

The latter point, she said, is the “leviathan in the room.”

“We need to deal with wealth inequality in this country,” she added, citing the oft-referenced anecdote that even as McDonald’s offers an $18-per-hour wage, it’s still not enough for entry-level workers to afford the average rent in most communities, which can rise into the $2,000 per month range even for one- and two-bedroom rental units. 

As employers, government officials, economic development experts, planners and employees themselves fret about the difficulty of securing and retaining workers, the conversation invariably returns to the extreme high cost of housing, but in many instances, attempting to solve the housing issue is an exercise in treating the symptom while ignoring the disease. At its basic level, the problem with the worker shortage starts with historically low wages — especially in amenity-rich communities where low-wage tourism and service industries play an outsized economic role. 

That’s the problem — the opportunity is capturing tax revenue and intellectual capital. However, in many ways, those places have for years been courting disaster, relying on quality of life to compensate for high rates of poverty, tethering an underpaid workforce to a precarious and ultimately untenable economic position that has been obliterated by a tsunami of out-of-town cash — gobbling up housing and stressing local infrastructure with sudden increased demand, all while continuing to expect services that even in less tumultuous times weren’t adequately supported by local wages.

“Growth is as much a threat or more of a threat to community character and livability as increasing tourism,” Rumore said, later adding, “I honestly think there’s only so much these communities can do if we don’t deal with the fact that [amenity migrants] have so much buying power.”

A high hurdle to address low wages

Raising wages in Idaho has long been a toxic political commodity. Workers in the service and retail industries have been traditionally less well paid but, in the COVID era, seen as increasingly vital to the functioning of the economy as a whole. Regardless, they have suffered the brunt of rising costs for everything from housing to basic commodities and powerful forces from Congress to the Idaho Statehouse have mounted a long-standing opposition to any increase in the minimum wage, predicated in large part on the argument that it would drive employers to insolvency and government into a regulatory quagmire.

“What I want is a rising wage rate for everybody … but the problem with any federal mandate is what’s applicable in one community is not applicable in the other,” Gov. Brad Little said in a press briefing in April. “That’s the problem with a minimum wage — you could have it vary around the state, but the bureaucracy would be more than we can handle.”

Meanwhile, the average Idahoan in 2019 earned almost $10,000 per year less than the national average, and between $15,000-$16,000 less than their counterparts in neighboring states. Worse yet, Bonner County residents earn less than the average of their own region in the state, even on the metric of median household income, which in 2019 was pegged at $50,256 — more than $3,600 less per year than the Northern Region as a whole.

Workers can’t work unless they can afford to live where they work, but they can’t afford to do either if their wages are so low that it doesn’t make sense to do either.

Sen. Grant Burgoyne, D-Boise, floated a bill in the 2021 legislative session that would have raised Idaho’s minimum wage from $7.25 — established in 2009 — to $15 per hour, though by stages through July 2023. The federal minimum wage is $10.95 per hour and due to increase to $11.25 effective Jan. 1, 2022. 

Burgoyne’s Senate Bill 1028 died in committee, though he told the Idaho Capitol Sun in May that “it’s long overdue.”

His legislation also would have increased wages for tipped workers, raising them from the current $3.35-per-hour minimum wage to $7.50 by 2023. Those wages haven’t changed since 2007.

While efforts have surfaced in recent years to raise Idaho’s minimum wage, including ballot initiatives and mobilization campaigns like Idahoans for a Fair Wage, other voices around the state have been just as vocal with the opposite intent.

Namely, the Idaho Freedom Foundation — a far-right lobbyist group out of Boise — has made its position against raising the minimum wage clear. IFF President Wayne Hoffman, a former newspaper reporter turned libertarian activist who did not reply to the Reader’s request for comment, shared in a 2013 blog post that “the thing that is keeping Idahoans from experiencing the full level of economic opportunity” isn’t the state’s “failure to adopt a higher minimum wage, but the government’s willingness to put in place more and more barriers to economic opportunity” — barriers to starting businesses or entering a trade, according to IFF.

More recently, Hoffman signed onto a letter headed up by D.C.-based conservative advocacy group FreedomWorks urging members of Congress to “reject any increase in the federal minimum wage.” The letter, dated June 23, 2021, drew signatures from two dozen similar special interest groups.

“Whether it be to $11, $15 or any other dollar amount, increasing the federal minimum wage further takes away the freedom of two parties to agree on the value of one’s labor to the other’s product,” the FreedomWorks letter reads. “As a result, employment options are restricted and jobs are lost. Instead, the free market should be left alone to work in the best interest of employers and employees alike.”

As for possible future moves by the Idaho Legislature regarding raising the minimum wage, the Idaho Association of Commerce and Industry told the Reader that “it would likely have to come through the initiative process.”

“We believe at IACI that there are so many other issues that we are working toward right now that seem to be more urgent since the marketplace has taken care of providing jobs far above and beyond minimum wage,” said Amos Rothstein, IACI communications director.

IACI is the self-proclaimed “most effective business lobby” in Idaho, representing about 300 of the state’s employers in industries ranging from agriculture to construction to banking. Rothstein said that many of IACI’s members have expressed concerns about the worker shortage, which he said can be credited to fear of COVID-19, early retirement, an increase in self-employed folks and the fact that “thousands and thousands of people around the country have become caretakers to children and elderly relatives because they either cannot afford external care or do not like the care options they can choose from.” 

That’s one of the aforementioned “other issues” that IACI is working toward solving with public policy: “access to childcare at the workplace, since that can be very cost prohibitive to many people, especially with multiple children, working full-time jobs.” 

Further, IACI is “pushing for bringing in more vetted refugees to Idaho and temporary workers on Visa so that they can be a part of the workforce here that desperately needs skilled and dedicated workers to help keep up with demand.” 

“We are proud Idaho has been such a good example of integrating refugees in the past and what the future holds for the state in this regard,” Rothstein continued.

For now, this lobbying power isn’t naming a higher minimum wage as a solution for Idaho’s worker shortage.

“Idaho is open for business,” Rothstein said. “Our member companies know that part of keeping a strong and talented workforce is to pay wages that attract people to their companies and allow their employee’s families to live comfortably here in [the] Gem State, even with the uptick in cost of living.”

The case of Creston

Close to home but a country away, Creston, British Columbia, is only about an hour and half north by car from Sandpoint. It exists among the same geographic features as Bonner and Boundary counties, its waters and mountains shared across the international border. It’s also an amenity-rich community that has been “discovered” by an influx of high-wage earning workers who not only bring their fat wallets to the local economy, but don’t necessarily contribute to its workforce while still putting stresses on its housing, infrastructure and wage structures.

“I think it’s all over right now, it’s both our countries, and every community in British Columbia is struggling with it,” said Creston City Councillor Norm Eisler. “There’s a bit of an exodus from big cities due to COVID. We’ve been so lucky out here — even when we were shut down here I could go for a hike and not see anybody. … [But] people are discovering it.”

Though Eisler is only in his first term on the Creston Council, he has already grasped many of the issues facing Creston and how they resonate with Sandpoint, as both communities have been “discovered” and subjected to similar waves of in-migration by high-wage earning remote workers or otherwise well-heeled retirees leveraging their wealth to buy up their own piece of peace and quiet in the rural Inland Empire.

“We are starting to run into problems here because of housing because it’s hard for companies to get people to come here because they can’t afford to rent a house; so, unless you’re of means or inter-generational wealth, it’s hard to qualify for a mortgage,” he said.

As in Sandpoint, Creston is grappling with how best to craft ordinances and regulations to encourage affordable housing — among them, tax breaks for the development of worker housing, easing restrictions on accessory dwelling units (referred to in Canada as “lane-way” or “carriage houses”), increased multi-family housing and fee structures that would capture capital from developers to be then allocated toward supporting affordable housing projects.

Regardless, “Developers are going to come in and make a shitload of money, and they usually already have a lot of money,” he said, underscoring that, at the base of the issue, is the amount of money in workers’ bank accounts.

“I don’t think if you just get more housing stock it will solve all the problems,” he said.  

In British Columbia, the minimum is $15 per hour — based on the current exchange rate, that’s $12.13 USD — but it’s still “nothing, when rent is so high,” Eisler said.

“I personally think minimum wages need to be at least $20 — that’s just getting by these days,” he told the Reader, adding later, “If you can’t afford to pay $15 an hour, you don’t have a viable business model.”

“Fifteen dollars an hour might be OK if you’re in a server job and you’re making tips. I don’t think many people are paying just $15 — I don’t think that’s possible anymore,” he said, adding that in Creston prevailing wages are in the $20 to $25 range.

Eisler’s day job is as a massage therapist and he also picked up some shifts as a bartender — a job that ended up paying $38 an hour: “That’s good money, but it wasn’t life-changing,” he said.

Regarding the $15 minimum wage in B.C., Eisler said, “I haven’t seen any businesses close,” and added that it will take “a whole societal shift around these issues” to find a measure of balance between workers’ ability to afford to work.

“It takes some bravery to do, and people will react, and you just have to be brave and do it,” he said. “The way we look after the least fortunate among us says everything about it.”

‘Pushed out’

In her 2021 book, Pushed Out: Contested Development and Rural Gentrification in the U.S. West, University of Idaho sociology Professor Ryanne Pilgeram — a 1999 Sandpoint High School graduate — writes of a “new way” of envisioning economic development and growth, using the history of Dover as a mill town-turned-resort community as a case study. 

Speaking at the Idaho Chapter of the American Association of Planners conference in early October, she sketched the broad argument of her book, which has quickly become a sensation among planning experts throughout the region: 

“It’s my belief that in planning communities we have to consider questions like, ‘Where will the people who cut our hair live? Where will the people who bag our groceries live? What about the people who teach our children? Where will they recreate and how will we create communities where the lives of all the people in our communities are intersecting in places where we are able to create community instead of creating these sorts of divisions?”

The answer to that question also addresses an explanation of “where are all the workers?”. They are here, but in ever-fewer numbers — increasingly “pushed out,” as Pilgeram’s book puts it, due to a confluence of low wages that have exposed them to structural wealth inequalities as the commodities being traded in their communities morph from resource extraction to the natural amenities themselves. It’s a boom-bust cycle in which areas of special value are repeatedly exploited in the service of outside profit — whether it be timber, mining, or real estate and resort investment.

Fixing the cyclical problem, or at least evolving out of it, will take political will — whether it be in the area of ordinances and regulations to encourage workforce housing, or structural changes to the prevailing wages in amenity-rich areas like Sandpoint, or listening to more varied voices in the growth and development process. That said, as Pilgeram and others have noted, “We have less political will than in some places to address these issues.” 

“People have lived in Idaho for at least 10,000 years and it’s only been in the last 100 years that we’ve been dealing with this intense boom and bust,” she said. “Maybe that doesn’t have to be our future.”

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