Wednesday, October 20, 2010

Get Ready to Hear About the 80 Gazillion Hospitality Jobs...Again

One of the figures that is often cited when discussing the Capital Improvement Board and corporate welfare for the Indiana Pacers is the 66,000 jobs related to the hospitality industry, the implication is that the Pacers being there help draw people to use the facilities that employ these people and thus keep them employed. And that without the Pacers, many of these jobs would just up and vanish.

I have difficulty accepting that premise on two fronts.

Last night, I talked to a few hospitality workers who are with Central Indiana Jobs with Justice and Unite Here, both organizations that are pro-union and are currently attempting to organize at the Hyatt Hotel in downtown Indianapolis. I asked them about the 66,000 jobs figure, where these jobs exactly are, and how they feel about them being cited by politicians.

They explained to me that they do believe that these 66,000 jobs are a downtown Indianapolis figure and not a regional figure. But they also noted that these jobs are low wage jobs, mostly paid by the hour with probably some tip-based jobs mixed in as well. Many workers who are employed in these types of jobs work two or three jobs to get by, and their concern is that these figures are heavily inflated. Even City-County Council representative Barbara Malone (R-At Large) said, during the council meeting:

"I agree that there are not 66,000 jobs in the hospitality industry. If anything, its 22,000 working 3 jobs"

The hotel workers didn't really seem to like being held up as talking points to support political actions that seem to work against their self-interests. I mentioned to them that a group of hotel workers were in attendance at a meeting I attended about a year ago as representing the 66,000 jobs, and they didn't seem pleased.

If you ask me, this is something that libertarian minded folk and the pro-union crowd can agree on. We need to stop subsidizing everyone with a few million bucks in their pocket and just let these hotels stand or fall on their own two feet.

The other premise I have trouble accepting is that these jobs would be negatively affected by the lack of the Indiana Pacers in Conseco Fieldhouse.

Personal economics teaches us about disposable income. This is money that people earn that is not being paid to a necessity such as utility bills, shelter, food, and so on. It is money that they'll spend, save, or invest. But they will use it in one way or another. The vast majority of the Pacers' audience are local residents. So if the Pacers do vanish as an option for one's entertainment dollar, it'll simply be spent elsewhere in the city. A small fraction of those who travel in from the donut counties to see the games might be a loss, but a small loss.

The other assumption is that if the Pacers leave, Conseco Fieldhouse will essentially be boarded up and vacant. Several companies responded to a recent request from the CIB asking for outlines of who would be interested in managing the CIB's various facilities, but the plans to push for privatization were abruptly dropped. Though I can't find the article, I remember one large concert promoter and venue manager seemed excited about managing a venue such as Conseco Fieldhouse. He obviously saw a lot of potential. This means that if the Pacers do leave, there will be more room available for events such as concerts. Most of the normal National Basketball Association's regular season occurs during colder months where outdoor music venues such as Verizon Wireless Music Center in Noblesville and the Lawn at White River State Park are not viable. Freeing up a large indoor venue would make it easier to schedule musical tours, among other events. It is not at all uncommon to look through a musical act's tour schedule and notice that they'll criss-cross the Midwest but all too often will skip over Indianapolis, and sometimes the entire state.

And before someone talks about the $57 million in economic impact the Pacers have, that number is even disputed by the unofficial cheerleader of Mayor Greg Ballard, Abdul Hakim-Shabazz. Shabazz says in this post that the number seems to be based off of when the Pacers had a winning record. Based on his conversations, there isn't much of an increase in business on game nights nowadays.

For those that haven't had the chance to see the tape from last night's committee meeting, Pat Andrews had several excellent public comments. Just fast forward to that. Everything else is just the council self-congratulating for a band-aid well patched in relation to the "fixed" budgets of the library and IndyGo.

On an unrelated note, kudos to Francessca Jarosz. Jarosz was the local government reporter for The Indianapolis Star until recently where she started at the Indianapolis Business Journal. She was the only one in the traditional media to show up.

1 comment:

  1. When they first trotted out the 66,000 hospitality job figure and you read the comments closely, you will see that it was a central Indiana figure. Over time, that qualification has faded and people started talking as if that figure related to downtown jobs related to the convention business. It doesn't and never did.

    It should be pointed out that many of those jobs are part-time and often don't pay very well at all. But that justifies spending milliions to prop up those jobs...but then again, pro sports doesn't do that as that discretionary spending and the jobs associated with it would just go someplace else if the Pacers and Colts didn't play here.


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