Middle-Class Tourism Jobs: Fact Check

Middle-Class Tourism Jobs: Fact Check

Photo by Sam Hodgson

Hotels on San Diego's downtown waterfront

 

Image: MisleadingStatement: “Fifty-three percent of tourism employees earn a middle-class salary or higher,” said Joe Terzi, president and CEO of the San Diego Tourism Authority at a Feb. 25 City Council meeting.

Determination: Misleading

Analysis: San Diego tourism leaders are emphasizing their industry’s economic impact as they try to persuade Mayor Bob Filner to allow a previously approved deal to move forward.

They want the mayor to sign an operating agreement that would allow the San Diego Tourism Authority to use a 2 percent charge on hotel bills to advertise the region and support Tourism Authority operations. But as we’ve explained in other posts, Filner isn’t budging and the situation will likely be hashed out in court.

Salaries in the tourism industry became a flash point in the debate, particularly when Filner proposed a livable-wage requirement for workers at downtown hotels.

Tourism Authority CEO Joe Terzi shot back, insisting at a recent City Council meeting that more than half of tourism employees earn at least a middle-class salary.

We decided that claim merited more vetting because Filner, as well as advocates and labor leaders, have criticized the salaries at downtown hotels.

The figure Terzi cited came from a national study released late last year.

The U.S. Travel Association analyzed years of survey data from the federal Bureau of Labor Statistics to track the earnings and long-term success of workers in the tourism industry.

Hotel workers aren’t the only tourism workers. The industry also includes entertainers, recreation workers, restaurant servers and more.

David Huether, the association’s senior vice president of research, said about 19 percent of those staffers work in the lodging industry while the majority, roughly 40 percent, works in food service.

Huether, who oversaw the study, determined a middle-class salary could range from $25,854 to $68,920. More than half of travel workers across the nation make at least that amount, he said.

But that’s a national estimate, and it’s more costly to live in San Diego than in many other parts of the country.

Marney Cox, chief economist at SANDAG, was skeptical about how the study’s findings translate in San Diego.

“It’s probably not going to be true in most places in California but it would probably be more true in Louisiana,” said Cox.

Cox suggested a comparable middle-class salary range in San Diego would be closer to $40,000 to $80,000.

Kelly Cunningham, an economist at the National University System Institute for Policy Research, also suggested San Diegans need to make more to be considered middle class.

Some analysts define the middle class as the middle 50 percent of incomes. By that calculation, Cunningham said the average 2011 San Diego County income of about $51,000 means residents who make or live in a household with a total income of $38,000 to $70,000 can be considered middle class.

The average salaries for tourism industry workers in San Diego County don’t fit either metric.

Data from the state’s Employment Development Department, which tracks labor trends in the state, shows the average San Diego County travel industry worker brought in a wage that would amount to less than $30,000 annually.

From January to March 2012, the county’s leisure and hospitality workers brought home an average of $430 a week or an estimated $22,360 annually. Wages dropped slightly from April through June to $414 a week.

Hotel workers posted somewhat higher average salaries. State figures show they made an average of $570 a week, or roughly $29,640 annually, in the first three months of 2012. Wages fell to $557 a week from April through June.

Terzi and Kerri Kapich, the Tourism Authority’s top marketing official, pointed to industry-specific factors when presented with those findings. For example, Terzi said, many tourism industry staffers work part time and may attend school or hold another part-time job. They may also collect tips that aren’t reported fully.

“There are a lot of those issues in the industry that affect overall reported numbers in terms of annual income,” Terzi said. “Those are two major things that affect these numbers and tend to have them trend lower than they are.”

National Bureau of Labor Statistics data showed the average leisure and hospitality worker put in an average of 26 hours a week from October 2012 through January 2013. Similar data wasn’t available for San Diego County.

Still, it’s clear that tourism workers in San Diego County need to make more than they would in many other parts of the country to cover their expenses.

A 2010 report by the nonpartisan California Budget Project found that a single adult would need to make about $620 a week to cover housing, food and other bills in San Diego County. A single parent would need to make $1,278 a week to support a household, according to the report.

The average wage for San Diego County tourism workers is less than these weekly salaries.

“It’s not uncommon for hotel workers to get two full-time jobs to be able to live in San Diego,” said Brigitte Browning, president of Unite Here Local 30. The union represents about 4,500 tourism workers in San Diego County.

Terzi acknowledged San Diego-specific information would be more useful than national data in discussions about the incomes of San Diego’s tourism workers. He pledged to cite more local figures if they become available.

“We’re not trying to mislead anyone,” Terzi said.

But that’s the effect of citing a national study without clarifying the source of the figures. It leaves a deceptive impression because what constitutes a middle-class wage in many southern or midwestern cities would leave a San Diego family struggling to make ends meet.

For that reason, we’re labeling Terzi’s statement “misleading.”

If you disagree with our determination or analysis, please express your thoughts in the comments section of this blog post. Explain your reasoning.

Lisa Halverstadt is a reporter at Voice of San Diego. Know of something she should check out? You can contact her directly at lisa.halverstadt@voiceofsandiego.org or 619.325.0528.

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Lisa Halverstadt

Lisa Halverstadt

Lisa Halverstadt is a reporter at Voice of San Diego. Know of something she should check out? You can contact her directly at lisa@vosd.org or 619.325.0528.

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45 comments
Anne Wilson
Anne Wilson subscriber

Agreed. Average is a poor tool to use. Median is much more indicative of how many people working in the tourism industry earn low wages.

Annew
Annew

Agreed. Average is a poor tool to use. Median is much more indicative of how many people working in the tourism industry earn low wages.

Keith Mautner
Keith Mautner subscriber

Aside from that, the vast majority of tourism employees do not earn a salary and many work part-time. The statement needs to be challenged as misleading and an omission on mainly for that reason, but is almost ignored. It also seems that you treat restaurant workers as being in the "tourism" industry. Restaurant workers belong in the hospitality industry, of which tourism is but a subset. Only a very small percentage of restaurant workers actually work in the tourism industry. Most restaurants are away from areas where tourists congregate.

profundis
profundis

Aside from that, the vast majority of tourism employees do not earn a salary and many work part-time. The statement needs to be challenged as misleading and an omission on mainly for that reason, but is almost ignored. It also seems that you treat restaurant workers as being in the "tourism" industry. Restaurant workers belong in the hospitality industry, of which tourism is but a subset. Only a very small percentage of restaurant workers actually work in the tourism industry. Most restaurants are away from areas where tourists congregate.

Joe O'Keefe
Joe O'Keefe subscriber

y the rates they do; they don't take much skill, time or effort to learn them. If pretty much anyone can do the job why are we attempting to force companies to pay more for them? Why do we want to make it profitable to stay in such a low end job? I would want these folks to excel , not languish in a dead end job for the rest of their life. Maybe it’s just me, but forcing people to better themselves would lift the community as a whole wouldn’t you say?

Only in SD
Only in SD

y the rates they do; they don't take much skill, time or effort to learn them. If pretty much anyone can do the job why are we attempting to force companies to pay more for them? Why do we want to make it profitable to stay in such a low end job? I would want these folks to excel , not languish in a dead end job for the rest of their life. Maybe it’s just me, but forcing people to better themselves would lift the community as a whole wouldn’t you say?

joseph davies
joseph davies subscriber

Check out a book called a dictionary if you aren't familiar with that term.

JP Davies
JP Davies

Check out a book called a dictionary if you aren't familiar with that term.

shawn fox
shawn fox subscriber

nted without a city wide vote then I don't see how exactly the unions are going to win. It seems like a gamble, and the unions and filner hope that the hoteliers give in and settle out of court before the court rules. Personally, I don't like either side in this but it is really interesting to observe.

shawn1874
shawn1874

nted without a city wide vote then I don't see how exactly the unions are going to win. It seems like a gamble, and the unions and filner hope that the hoteliers give in and settle out of court before the court rules. Personally, I don't like either side in this but it is really interesting to observe.

joseph davies
joseph davies subscriber

Except that your comparison is utterly ridiculous. Pravda was a state run newspaper censored to include only the viewpoint of the government. VOSD is the polar opposite of Pravda. Your problem is that you agree with the powerful and the elite. If you want Pravda go to the UT. You won't find Pravda here.

JP Davies
JP Davies

Except that your comparison is utterly ridiculous. Pravda was a state run newspaper censored to include only the viewpoint of the government. VOSD is the polar opposite of Pravda. Your problem is that you agree with the powerful and the elite. If you want Pravda go to the UT. You won't find Pravda here.

joseph davies
joseph davies subscriber

The inconsistency and hypocrisy of the Right on just about every issue is appalling.

JP Davies
JP Davies

The inconsistency and hypocrisy of the Right on just about every issue is appalling.

Bob Nelson
Bob Nelson subscribermember

plays a major role in their total income. It’s not politics, it’s arithmetic. Just ask your local bartender. CRECC Members Final Report

Doug Sommer
Doug Sommer subscriber

It was only mentioned briefly here, but a big part of a hospitality employees earnings are in "unreported tips". Almost all food service front of the house employees receive tips, but are only required to report a small amount of it. Many don't report any at all. Restaurant servers are only required to report 8% to their employer. Many report less than the amount of tips that can be proven by credit card receipts. California does not allow employers to pay a sub minimum wage for a portion to these tips like many other states do. This tip credit reduces the minimum wage in most other states. Also many of the employees are attending college or trade schools and this income is a supplement to their scholarship or student loan money.

som413
som413

It was only mentioned briefly here, but a big part of a hospitality employees earnings are in "unreported tips". Almost all food service front of the house employees receive tips, but are only required to report a small amount of it. Many don't report any at all. Restaurant servers are only required to report 8% to their employer. Many report less than the amount of tips that can be proven by credit card receipts. California does not allow employers to pay a sub minimum wage for a portion to these tips like many other states do. This tip credit reduces the minimum wage in most other states. Also many of the employees are attending college or trade schools and this income is a supplement to their scholarship or student loan money.

john eisenhart
john eisenhart subscriber

Funny how I have first hand knowledge of the history and personal family history of Detroit, yet you come up with a talk show mantra "Union bad" as the reason for all social and political problems inherit in the city. But once the unions are completely outlawed, we will see how well your glorious vision of zero labor rights works.

mr architect
mr architect

Funny how I have first hand knowledge of the history and personal family history of Detroit, yet you come up with a talk show mantra "Union bad" as the reason for all social and political problems inherit in the city. But once the unions are completely outlawed, we will see how well your glorious vision of zero labor rights works.

Lucas OConnor
Lucas OConnor subscriber

It occurs to me that so long as we're debating whether local workers 'need' the difference between minimum wage and a living wage to survive as opposed to whether, say, Hyatt 'needs' that revenue to survive, we've missed the boat.

lucasoconnor
lucasoconnor

It occurs to me that so long as we're debating whether local workers 'need' the difference between minimum wage and a living wage to survive as opposed to whether, say, Hyatt 'needs' that revenue to survive, we've missed the boat.

john stump
john stump subscriber

These folks are hard working honorable people and their compensation should should be at least a living wage

jwstump
jwstump

These folks are hard working honorable people and their compensation should should be at least a living wage

Chris Brewster
Chris Brewster subscribermember

I appreciate VOSD's efforts here to use available studies to address this question. I agree with the determination. That said, does anyone truly believe that the average person working in the tourism industry is making enough money to live a decent life in San Diego? These are, by and large, low pay and low benefit jobs. The people making real money are the Doug Manchesters of the world, who benefit by low wages and minimal benefits for their employees.

B Chris Brewster
B Chris Brewster

I appreciate VOSD's efforts here to use available studies to address this question. I agree with the determination. That said, does anyone truly believe that the average person working in the tourism industry is making enough money to live a decent life in San Diego? These are, by and large, low pay and low benefit jobs. The people making real money are the Doug Manchesters of the world, who benefit by low wages and minimal benefits for their employees.

David Cohen
David Cohen subscriber

The duplicity of those who speak for the hotel industry defies description.

fryefan
fryefan

The duplicity of those who speak for the hotel industry defies description.

Jim Jones
Jim Jones subscriber

John, what happened to Detroit was that the unions drove the manufacturing away. It really is that simple.

Jim Jones
Jim Jones

John, what happened to Detroit was that the unions drove the manufacturing away. It really is that simple.

Lucas OConnor
Lucas OConnor subscriber

We should probably remember to differentiate between 'able to survive at or near poverty' and 'middle class.' Also that food service involves a heck of a lot more than front-of-house staff at downtown bars and sit down restaurants.

lucasoconnor
lucasoconnor

We should probably remember to differentiate between 'able to survive at or near poverty' and 'middle class.' Also that food service involves a heck of a lot more than front-of-house staff at downtown bars and sit down restaurants.

john eisenhart
john eisenhart subscriber

I grew up in Detroit and that city had the greatest middle class in the world because the unions were strong. We lived on my dad's working class salary, mom and us four kids. We were able to go to college (worked to pay tuition) and never worried over medical bills because the unions created a full medical package for employees. The community was the model for the world. However, the elite could not accept that and ruined the city through demonizing the poor, the blacks, the asian, etc...... Damned if I'll let negative money grubbing people ruin this city. Always support people who have less than you. It 's called being a human being.

mr architect
mr architect

I grew up in Detroit and that city had the greatest middle class in the world because the unions were strong. We lived on my dad's working class salary, mom and us four kids. We were able to go to college (worked to pay tuition) and never worried over medical bills because the unions created a full medical package for employees. The community was the model for the world. However, the elite could not accept that and ruined the city through demonizing the poor, the blacks, the asian, etc...... Damned if I'll let negative money grubbing people ruin this city. Always support people who have less than you. It 's called being a human being.

joshuajay619
joshuajay619

I can tell you that the vast majority of servers and bartenders in downtown are single and have no kids and make more than $32k per year. As others have stated, that's not the worst you could get paid for part time work that doesn't require higher education.

Jim Jones
Jim Jones subscriber

The hotel workers can always move or better their employment potential.

Jim Jones
Jim Jones

The hotel workers can always move or better their employment potential.

Jim Jones
Jim Jones subscriber

Once again we see the sliding scale of what constitutes "truth" here. Between the bias in the choice of what to fact check and what to ignore, and the different standards based on the politics of the subject, I feel I am reading "Tass" and "Pravda" thirty years ago.

Jim Jones
Jim Jones

Once again we see the sliding scale of what constitutes "truth" here. Between the bias in the choice of what to fact check and what to ignore, and the different standards based on the politics of the subject, I feel I am reading "Tass" and "Pravda" thirty years ago.

Susan Bruinzeel
Susan Bruinzeel subscriber

s $48,200. $36K for no higher degree....hhmmmm. I stamp your fact check MISLEADING.

susanb
susanb

s $48,200. $36K for no higher degree....hhmmmm. I stamp your fact check MISLEADING.

Augmented Ballot
Augmented Ballot subscriber

Seconding Lucas' comment. As rhetoric, "middle class" has an intentional meaning and weight very different from just making ends meet. Is Terzi saying that hospitality workers here are paid enough to send their kids to college, to weather medical emergencies, and to save for retirement? If yes, "misleading" doesn't really cut it. It's inaccurate and "reasonable to expect the person making it knew that and made the claim anyway to gain an advantage." There's a term here for that.

Augmented Ballot
Augmented Ballot

Seconding Lucas' comment. As rhetoric, "middle class" has an intentional meaning and weight very different from just making ends meet. Is Terzi saying that hospitality workers here are paid enough to send their kids to college, to weather medical emergencies, and to save for retirement? If yes, "misleading" doesn't really cut it. It's inaccurate and "reasonable to expect the person making it knew that and made the claim anyway to gain an advantage." There's a term here for that.

Lucas OConnor
Lucas OConnor subscriber

Seems to me middle class is more about living standard than a particular number. If you can't achieve a middle class standard of living, you don't have a middle class income. Suggesting otherwise seems like an excuse.

lucasoconnor
lucasoconnor

Seems to me middle class is more about living standard than a particular number. If you can't achieve a middle class standard of living, you don't have a middle class income. Suggesting otherwise seems like an excuse.