No Housing, No Employees
Credit: Melissa Siig for Moonshine Ink | June 11, 2021
With local workforce losing their homes, businesses struggle to find staff; the consequences will be felt by everyone this summer
Christy Hill Executive Chef Andrew Shimer is terrified about what is going to happen this summer. As he prepares for what many are expecting to be an extremely busy summer, Schimer does not have enough employees to properly staff the restaurant, especially in the kitchen. He needs at least seven more back-of-the-house employees, but he has been getting zero responses to his help wanted ads on Facebook and Craigslist. After picking up the slack and working 14-hour days, seven days a week, Shimer made a decision last June to close the restaurant on Mondays and Tuesdays to keep himself from burning out. He also simplified the menu so a smaller kitchen staff can handle preparing the food when the restaurant gets slammed.
“This is by far the worst I’ve ever seen it,” said Shimer, who has been in Tahoe 15 years, working at Christy Hill for the past 10. “It’s going to be the busiest summer in a long time, and to keep up with demand is going to be exhausting. We are losing thousands of dollars just by being closed a couple days a week, especially in the summer. We are paying rent and not making money.”
Shimer is not alone in his concerns. Almost every restaurant in the region is suffering from a lack of employees. While some blame the stimulus checks or former workers moving on to other jobs during the pandemic, everyone Moonshine Ink interviewed for this story cited the dearth of affordable housing as the number one culprit of the employee shortage. Although workforce housing has long been an issue locally, the situation has been compounded by the pandemic. Demand for houses in the area soared, driving up prices, depleting inventory and impacting the rental market, with landlords moving into their own properties, raising rents, or selling them to cash in on skyrocketing home prices.
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And it’s not just restaurant employees who are losing their housing. Many business owners who rent find their homes are being sold, leaving many to wonder — what becomes of a community when the workforce and business owners can no longer afford to live there?
Home Sweet Home, but for Whom?
The inability to find employees is not unique to Tahoe/Truckee, but rather a nationwide problem. A March survey conducted by the National Federation of Independent Business found that 42% of owners had job openings that could not be filled, a record high. And 91% of those hiring or trying to hire reported few or no qualified applicants for the positions they were trying to fill.
While nationally the lack of employees can be attributed to pandemic-related issues like extra unemployment benefits, lack of childcare, or unvaccinated people’s fear of returning to work, locally the overriding cause is housing. The Truckee Tahoe Workforce Housing Agency, founded in 2020 by four special districts (the Truckee Donner Public Utility District, Truckee Tahoe Airport District, Tahoe Truckee Unified School District and the Tahoe Forest Hospital, with a combined 1,900 employees), reports that 43% of its member employees found it “very difficult” to find housing the last time they moved.
“I can say that the people who make this community run are very close to having to leave,” said Emily Vitas, TTWHA executive director. “How do our special districts continue to run if they don’t have the employees? … It feels like we have seen 12 years of change and growth in six months.”
Over the past year, Tahoe/Truckee has set a record for the number of houses sold, according to Charlene Gamet, a realtor with Sierra Sotheby’s and the president of the Tahoe Sierra Board of Realtors.
“The problem is, we don’t have available inventory. If a house hits the market it’s sold within a week. We can’t say, ‘come up next week to look at six houses’ because they are going to be gone,” she said. “It’s record-breaking because homes are selling so fast, and record-breaking prices because there is so much demand.”
According to Sierra Sotheby’s market reports, the median home price in Truckee for the first quarter of 2021 was up 70%, and the average price of homes sold was $1.2 million, up from $745,000 in 2020. At Tahoe, the median home price in Tahoma and Rubicon Bay was up 98% during the same period, and the average sales price for the West and North shores was $999,000, up from $670,000 in 2020. According to the Truckee Tahoe Workforce Housing Agency, an affordable purchase price for a 3-bedroom home in Eastern Placer County is $382,000, a price that now is practically non-existent.
“We have not seen a market like this before, at least not in my lifetime,” Gamet said. “It’s great while we are in it, but it has to make adjustments because it’s pushing out all of our local people … All of our rentals, people are cashing out now, so we are losing rentals and that is a problem.”
Disappearing rentals
This is a major concern for restaurants. Moody’s Bistro Bar & Beats in Truckee has half the kitchen staff they need for the summer. Like many restaurants, they have raised wages for the back of the house, and pool tips to attract kitchen employees. Moody’s general manager, Sam LeRoque, says the going rate for line cooks has jumped almost 30% in the last four years, but to no avail.
“We have crunched the numbers and are paying the absolute most that we can,” LeRoque said. “We have made adjustments to spread the wealth more than we ever have before to try to capture and retain good employees. But is it working? Not yet.”
LeRoque, who has been Moody’s GM for five years, says the labor market is the absolute worst he has ever experienced. Even when potential candidates from out of the area apply, they usually don’t have housing, so it doesn’t work out.
“You will find people and they don’t have a house yet, then they get up here and either have to leave or are unreliable because they are couch surfing,” he said. “For an employee to be a valuable and reliable employee, having a steady home life and place to live is imperative.”
To compensate for lack of employees, Moody’s shuts down food service between 4 and 5 p.m. to prepare for dinner. The burden of insufficient kitchen staff falls on the shoulders of the chef and sous-chefs, who now also have to do the work of prep cooks — chopping veggies and making sauces — as well as on management, which has to tightly control the number of customers per night to match what the kitchen can manage.
“We have ads up for employment, and no one is reaching out,” LeRoque said. “We are gearing up to get our ass kicked all summer. I don’t know if there is any way around it.”
BAR ONLY: Brian Nelson, owner of Pioneer Cocktail Club in Tahoe City, is changing his entire business to work without sufficient staff, focusing more on the bar scene and less on food service. Photo by Wade Snider/Moonshine Ink
Tahoe City’s Pioneer Cocktail Club is in the same boat. Owner Brian Nelson needs to hire eight to 10 more people in the kitchen, and has raised wages for dishwashers to $18 per hour and as high as $25 per hour for other positions. But he says these are not sustainable wages with the already thin profit margins of restaurants. Nelson has made adjustments to cope with the lack of employees. He is closed Tuesdays and says he might have to close on Wednesdays as well in the summer. He is buying kitchen appliances that can keep food warm in order to expedite cooking, and he might go to paper plate service.
“I want to be open every day in the summer, but if I can’t, it’s a $200,000 loss in sales if I only do dinner or no late night happy hours,” Nelson said. “Due to a lack of ability to handle people, we are shifting to more of a bar environment to relieve the kitchen so we can drop the expectation of service.”
Jake’s on the Lake’s general manager, Noah Wasserman, says that rising wages will be detrimental for both restaurants and consumers. He says the more restaurants have to pay workers, the more they will have to sacrifice the quality of food or raise prices.
“In the long run, the people who are going to suffer are the businesses and guests when burgers are $25 and cooked by a guy with next-to-no experience and is going to leave in a week when someone pays him more,” said Wasserman, who notes that three of his employees lost their rentals when they sold, and others have had their rent doubled. “We have a huge influx of new residents who don’t understand why no one has staff because they bought up all the rentals, through no fault of their own.”
HELP WANTED: Blue Mountain Painting owner Scott Smelser can’t find enough people to hire, despite raising wages by $7 per hour. He blames the lack of affordable housing.
Restaurants are not the only businesses being impacted by the housing crisis and labor shortage. Scott Smelser, who owns Blue Mountain Painting, says he currently has six employees and needs to hire at least 12 and possibly up to 20 more to meet demand for his services. When he started his company in 2014, he offered $15 an hour for kids right out of high school. Now he is offering $22 an hour and receiving minimal interest.
One of his employees moved to Carson City after he lost the Incline Village apartment he had been living in for 10 years. That concerns Smelser.
“I am 100% worried that I could lose employees who move to Carson City or Reno. That still adds expenses like gas and mileage,” he said. “You have to have a place for employees to live. You almost have to have a hostel.”
In fact, Old Town Tap owner Marlena John said she has an employee staying in the Redlight Historic Bunk Hotel, a hostel on West River Road, because the person has nowhere else to live. John said her restaurant needs five to six more employees, but has had no one apply for kitchen jobs yet. She blames the labor shortage on housing and extended unemployment benefits.
EVERYWHERE THERE’S SIGNS: Nearly every business in town seems to be looking for employees, including (from top) Coffeebar, Tahoe Forest Hospice Gift & Thrift in Truckee, and Tahoe Fuller’s, a food truck that recently opened a brick-and-mortar restaurant in Tahoe City. Photos by Wade Snider/Moonshine Ink
“Housing has been the biggest factor, long-term, for sure, but I think stimulus money has been a huge problem in the last six months,” John said. “It’s hard to know if we would have had a few hires by now if the stimulus hadn’t been generous.”
To compensate for lack of employees, John and her husband and partner, Luke, will have to work extra hours. She is anticipating working 60- to 70-plus hours a week this summer.
“We don’t want anyone else to burn out, and we don’t want to lose anyone else,” she said.
No Place to Go
Business owners are also finding themselves in housing jeopardy. Sahra Otero, who owns Heartwood Floristry and Planterium (formerly Wanda’s) in Tahoe City, received a letter from her landlord at the end of February notifying her that rent for her three-bedroom Tahoe City home would be increasing by about 50% in October. Otero said that she and her husband, an environmental health specialist with Placer County, could afford a 20% increase, but $1,000 more a month is out of their price range. She has started looking for homes everywhere from Roseville to Nevada City to Sparks.
“This is gut-wrenching, there is nowhere else to go,” said Otero, who has lived in her home for nine years with her husband and two kids. “We are in good shape, we are supposed to have options where we are now in our lives … We are not just waiting tables and running ski lifts; we are professionals. We belong here, we deserve to be here, we deserve to own property here and cultivate the community.”
Lorien Powers, who owns Lorien Powers Studio Jewelry in downtown Truckee, received notice at the end of April that the rental she has lived in for 13 years is being sold. Luckily, through word-of-mouth Powers has some leads in Kings Beach and Truckee.
“I don’t even know where to look for a place to live,” Powers said. “I think it’s widespread. I know so many people in our community who are looking for housing and having a hard time finding it.”
Last year, she lost an employee who wanted to find a new place to live locally, but then ended up moving to Nevada City after being unsuccessful.
Anyone who rents is facing an uncertain future. Monica Caldari, a Spanish and home study teacher at Creekside Charter School since 2008, had to move out of her Donner Lake rental in March because the owners are going to remodel it and rent it for a higher price. Unable to find any place to live around Tahoe/Truckee, she and her husband, a massage therapist at the Hyatt Regency in Incline Village, moved in with her mother-in-law in Reno. Now they both commute.
“It makes me feel like I am being told I just shouldn’t be here,” Caldari said. “I feel so incredibly unstable and completely unrooted. I feel like a visitor.”
Caldari believes the current housing crisis does not bode well for the community.
“There is no community without all the people who make it up,” she said. “How do you get to know anyone if you don’t see them out and about? We still try to go to New Moon because it makes me feel like I am still part of the community. It’s really sad. It feels like I am being replaced.”
Vitas, of the workforce housing agency, fears that if steps to remedy the situation are not taken, and quickly, there could be dire consequences.
“We become Aspen, we become a community where we have to bus people in and the culture is changed forever,” she said. “This place is so special, and without the people who run it, it’s going to feel like a very different place, and none of us want that.”
