San Francisco supervisors quietly passed an important bill late last year that no one is talking about. Mayor Gavin Newsom allowed it to become law without his signature.It's the country's strictest "local hire" ordinance, which stipulates that construction businesses working on top-dollar city projects must hire an increasing number of local workers each year. It sounds great to hire city workers on city projects. Everyone wants his local tax money to be spent locally, and everyone wants to know that there are local jobs. Even the San Francisco Chamber of Commerce decided not to take a position on the legislation. In a time of high unemployment, who wants to stand against local hiring?
Unfortunately, the new law is another idea that may sound better in theory than it works in practice. The new law will have real costs in terms of the city's administration duties and local businesses' competitiveness.Plus, by blatantly favoring local workers, San Francisco is thumbing its nose at its Bay Area neighbors. That's not a good idea in this economically interdependent region. And it could lead to an arms race among other local politicians over who can have the toughest local-hire ordinance. The losers in that battle will be workers - and taxpayers.
Under the new law, contractors and subcontractors working on city-funded construction projects worth $400,000 or more would have to hire at least 20 percent of their workers from San Francisco in 2011, 25 percent in 2012, and 5 percent more every year until the ordinance hits the 50 percent mark in seven years.
Those who fail to meet the requirements must either get an exemption - we suspect there will be heavy lobbying for lots of those - or pay a fine. State and federal projects are exempt, and many state and federal officials have the same concerns that we do.
"We all want to protect our immediate revenue and the income in our various jurisdictions," said state Assemblyman Rich Gordon, D-Menlo Park. "But we live in a region, and most of our citizens live regionally. They migrate between city and county borders based on what they're doing that day. We need to focus on creating jobs regionally, not encourage a trend towards balkanization." He's right - in a time of high unemployment, the last thing our highly mobile Bay Area workforce needs is restrictions on how much work they can get, based on the employment possibilities within their city's borders.The proper tactic for San Francisco leaders to have taken would have been to address the reasons why businesses don't hire San Franciscans in the first place. Currently, the businesses that do contracts with San Francisco's Department of Public Works hire locals at a rate of around 20 percent. Why not more?
"A lot of it has to do with what they're looking for at the moment, so if they're totally constricted to who's at the hiring hall that day, that's limited," said San Francisco Mayor Ed Lee. "And some of the unions haven't had their apprenticeship programs as open as they should to local kids so that they could get those skills." But if no one has provided San Franciscans with the education and the training that they need to compete for those jobs, whose fault is that? Is it really fair to blame that on contractors?"We have a truancy problem, an educational problem because a lot of gaps haven't been filled to encourage them to complete their education," Lee said.
To us, that sounds as if the city has failed to meet its responsibilities to its residents - not that business has failed to do the right thing. And while Lee insists that the new ordinance will ask everyone to "step up their efforts," this is the wrong way to achieve that.
Unfortunately, the new law is another idea that may sound better in theory than it works in practice. The new law will have real costs in terms of the city's administration duties and local businesses' competitiveness.Plus, by blatantly favoring local workers, San Francisco is thumbing its nose at its Bay Area neighbors. That's not a good idea in this economically interdependent region. And it could lead to an arms race among other local politicians over who can have the toughest local-hire ordinance. The losers in that battle will be workers - and taxpayers.
Under the new law, contractors and subcontractors working on city-funded construction projects worth $400,000 or more would have to hire at least 20 percent of their workers from San Francisco in 2011, 25 percent in 2012, and 5 percent more every year until the ordinance hits the 50 percent mark in seven years.
Those who fail to meet the requirements must either get an exemption - we suspect there will be heavy lobbying for lots of those - or pay a fine. State and federal projects are exempt, and many state and federal officials have the same concerns that we do.
"We all want to protect our immediate revenue and the income in our various jurisdictions," said state Assemblyman Rich Gordon, D-Menlo Park. "But we live in a region, and most of our citizens live regionally. They migrate between city and county borders based on what they're doing that day. We need to focus on creating jobs regionally, not encourage a trend towards balkanization." He's right - in a time of high unemployment, the last thing our highly mobile Bay Area workforce needs is restrictions on how much work they can get, based on the employment possibilities within their city's borders.The proper tactic for San Francisco leaders to have taken would have been to address the reasons why businesses don't hire San Franciscans in the first place. Currently, the businesses that do contracts with San Francisco's Department of Public Works hire locals at a rate of around 20 percent. Why not more?
"A lot of it has to do with what they're looking for at the moment, so if they're totally constricted to who's at the hiring hall that day, that's limited," said San Francisco Mayor Ed Lee. "And some of the unions haven't had their apprenticeship programs as open as they should to local kids so that they could get those skills." But if no one has provided San Franciscans with the education and the training that they need to compete for those jobs, whose fault is that? Is it really fair to blame that on contractors?"We have a truancy problem, an educational problem because a lot of gaps haven't been filled to encourage them to complete their education," Lee said.
To us, that sounds as if the city has failed to meet its responsibilities to its residents - not that business has failed to do the right thing. And while Lee insists that the new ordinance will ask everyone to "step up their efforts," this is the wrong way to achieve that.
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