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Economy

What’s Working: Rising rents and other costs outpace wage gains in Colorado

Plus: Union membership has been in decline but after a successful King Soopers strike, others in the service industry are organizing, including two Denver-area Starbucks.

Few local businesses are not actively seeking employees along Main Street in Breckenridge on Saturday, October 16, 2021. (Hugh Carey, The Colorado Sun)
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January was a big month for the worker, as the state’s minimum wage increased, King Soopers employees approved a contract to boost pay between $2 to $5 this year, and employers are still hunting for more help

But while wages have been increasing — Colorado’s average pay reached $33.28 an hour in December, up 8.2% in two years — a number of other costs increased, including one that takes up a huge chunk of a worker’s paycheck: housing.

Housing prices accelerated in the pandemic as demand and a supply shortage pushed up home prices in the double digits. Rents have gone up as well in the last two years. According to Apartment List, which tracks the change in monthly rents, the rent for a one-bedroom apartment increased between 7.4% to 19.8% in various Front Range metro areas since January 2020. 

Some workers continue to fall a bit behind if their income doesn’t grow along with the rising costs. Getting to that “livable wage” seems a pretty far distance for some workers. And, as some people who took the latest What’s Working survey explained, there are usually other costs that few think about when calculating budgets. 

One person mentioned that most landlords essentially require three months of rent to move in, for the first- and last-month rent and a security deposit. Another person said self-employed workers must pay their own health insurance premiums, taxes and sick leave.

And as mentioned last week, saving for retirement or for an emergency are part of livable-wage calculators, which show the minimum a person needs to earn in order to pay for life’s necessities. The calculators provide an estimate of income to live depending on city and family size. But they can be outdated.

For Denver, an individual needs to earn $41,200 a year — or full-time work at $19.81 an hour — to keep up with bills, including food, transportation, health care and taxes, according to the Economic Policy Institute’s Family Budget Calculator. And that’s based on 2017 numbers, said David Cooper, EPI’s director of economic analysis and research network.

“If we were going to inflate that to current day’s dollars, you’re talking clearly above $20, maybe $21 to $22 an hour,” Cooper said.

And that’s if you can find housing that fits the price estimate. Rent for a one-bedroom apartment in Denver averaged $1,560 in January, according to Apartment List.  EPI’s calculator has housing costs for a single person in Denver at $938. If you’re willing to take on a roommate and split the average cost of a two-bedroom apartment, which was at $1,898 a month, that does drop housing costs to $950 a month. 

But a livable wage isn’t just about rent. Inflation has increased the price of food, clothing and all sorts of necessities.

“A lot of what’s been driving inflation over the last two years has just been this mismatch between supply and demand,” Cooper said, and that impacted housing, food and many things consumers must spend their money on. 

“That disequilibrium is going to mellow out. Eventually, either supply will step up to meet demand because prices are so high and builders can make so much money off of increasing supply, or the higher prices will force some people to change their plans in terms of moving and demand will cool off. When that happens, inflation will get back to sort of a more reasonable level. And I think there’s some indication that that’s starting to happen now.” 

TELL US: What is a livable wage?

Unions growing: Starbucks workers unionizing in Denver

As union workers at King Soopers approve a new contract that took months to negotiate and a 9-day strike, others are pushing for a union of their own.

Workers at a Starbucks in Superior became the first Colorado store to petition the National Labor Relations Board to be represented by Starbucks Workers United.

Employees at a Starbucks store in Denver joined them on Thursday and filed a petition with the NLRB to get the coffee corporation to recognize the nearly two dozen employees as a bargaining unit. It’s not about money or a contract, at least not yet, said Michaela Sellaro, who works at the store sometimes referred to as “the barn,” on East Colfax Avenue at Milwaukee Street. 

Starbucks Workers United is representing employees who are in the process of forming a union, which includes two stores in Denver. (Provided by Starbucks Workers United)

“It boils down to having a seat at the table,” she said. “We’re called partners for so many reasons. But the actual act of being partners with Starbucks is a little bit lacking. We have that on-the-ground experience each and every day in the stores, knowing what’s going on,  knowing what’s working, knowing what’s not. And our input is very rarely asked for, if at all, and then when it is asked for, there’s not sort of a lot of implementation of the things that we’re seeing.” 

As for specifics, employee security is a big one. 

“We’ve had some very alarming incidents in the last couple of months,” Sellaro said. “I was pepper sprayed in the drive-thru window. One of my shift supervisors was punched in the face by a customer. There’s just been these sort of extremely distressing and disturbing experiences for all of us.”

Workers asked to switch to a grab-and-go store. The response was “we have really expensive furniture in the cafe, what are we going to do with that?” she said. They asked for a security guard but were told “that would create an escalation of every incident right from the beginning,” she said. “I can understand that, but there wasn’t a lot of, ‘OK, that won’t work. But what about this?’”

Eventually, the company sent a community resource officer who walked through the store to analyze the gaps. Starbucks added security cameras in the drive thru to capture license plates. 

Sellaro said she loves working at Starbucks and was thrilled to get a job with health benefits just after graduating from college. “But we would not have gotten to that point of making sure that partners are safe and protected without all the other things in between,” she said.

A Starbucks spokeswoman said the company leaves store closures and other decisions to district and local store managers. As for union activity, she shared a statement made in December when a store in Buffalo, N.Y.,  became the first Starbucks to unionize.

“The stance of the company is that while we don’t believe the union is necessary at Starbucks, we believe in the process and we respect our partners rights to organize.”

This is a change from the trend that has seen union membership decline dramatically in the past several decades. Workers feel empowered. The NLRB just issued a complaint against Amazon for interfering with workers in New York and and Alabama who were trying to organize.  Starbucks Workers United said dozens of other locations are in the process of unionizing. 

“This is a hell of a time for workers to stand together and demand better,” said Andy Winter, who quit his job in research to work for Communication Workers of America 7799. “COVID has amplified all kinds of issues with working conditions and wages everywhere.” 

→ Close to home: Speaking of unions, the one representing Meow Wolf workers in New Mexico filed an unfair labor practices claim with the NLRB against the art collective, which recently opened a venue in Denver. According to union officials, Denver workers are not part of it but employees here and at its Las Vegas location “are both very welcome to unionize but they would need to organize independently,” confirmed a representative from the Meow Wolf Workers Collective organizing committee. MWWC alleges the company had anti-union language, among other concerns.  (Updated with MWWC comments on March 3, 2022.)

Other working bits

Dozens of folks have filled out the What’s Working “Did you quit your job?” survey. The story, along with an update on the latest Job Openings and Labor Turnover Survey are coming next week. 

Spoiler alert (but not really): Many folks who quit cited job dissatisfaction, burnout and low wages. But most people went on to something that paid more or provided a better work environment where they felt appreciated. Check back next week to read the real-life reasons why people quit.

TODAY’S UNDERWRITER

→ Colorado’s not alone on pay transparency. At least eight states have laws on the books or pending that require employers to share how much a job will pay. It’s a “moment of reckoning” for employers, reports Money magazine. >> READ

→ Can’t make workers return to the office? Companies bemoaned the scarcity of potential employees or maintaining their own staff. Some of that may be because people want to work remotely. CNN reports on companies that decided to go fully remote permanently. >> READ

→ Hmm… remote work or flexible hours? According to a Wall Street Journal story, flexible hours are more popular than flexible locations. That’s taken from a survey of 10,000 workers. >> READ


So much to possibly write about, so little time. Thanks for reading another What’s Working column. And tell your friends — it’s free! Have it delivered to your inbox every Saturday by signing up at coloradosun.com/getww. Stay warm, ~tamara 


What’s Working is a Colorado Sun column for readers navigating today’s economy. Read the archive and don’t miss the next one. Get this free newsletter delivered to your inbox by signing up at coloradosun.com/getww

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