I’ve written extensively so far on Costa Mesa’s housing woes, which I’ve generally attributed to a shortage of housing units across the income spectrum. However, I want to dig into a different, but related big-picture question today.

So let’s step back and look at the 10,000 foot view: does Costa Mesa have a labor shortage?

I’m sure for some it seems like a strange question to ask. The traffic is terrible! We’re so much more crowded than we used to be! The pandemic put so many out of work; we probably have too many workers!

But I think the evidence, both statistical an anecdotal, is there. And I think it is inflicting a slow but steady drain on everyone’s quality of life.

Let’s start with what you would expect to see in an area suffering from a chronic labor shortage. The best way to do this is to put yourself in the shoes of an employer. Pretend you own a small business, like a cafe or a bakery. One of your servers has quit and left you with a critical job opening. You post the job online, in the newspaper and on the street, and you wait.

But no one responds. Now what?

Well, you’ve got a few choices:

1. You could raise the wages or benefits of the position until you get a healthy number of applications.
   
2. You could lower hiring standards and cast a wider net for applicants. In other words, you could trim experience requirements, education requirements, etc.
   
3. You could eliminate the position entirely, either by using automation to replace the position (such as using a kiosk to put in orders) or by asking the remaining employees to shoulder more hours, such that the responsibilities of the position are covered by others.

And no matter which (painful) option you choose, you are going to try and retain existing workers at all costs. You don’t want to be in this position again right away.

Now let’s expand these intuitive, individual businessowner behaviors into effects you might see across the whole labor market. If employers raise wages, you will certainly see increases in prices as well as those employers pass their higher costs onto the consumer. Lowering hiring standards and pressure to retain existing workers at all costs may have the perverse effect of lowering overall employee quality. This can lead to poor or slow customer service, inexperienced workers and low morale. And the morale problem will only be exacerbated if employers instead opt to replace departing workers with automation or spread out that worker’s tasks among the remaining employees.

The combination of higher prices, low employee motivation, curtailed services and a more impersonal shopping experience is the definition of a lower quality of life. And if you see all of them happening at the same time, then you’re effectively paying a tax on that quality of life. And you don’t even realize it.

There is another, even more important place where these ugly effects of labor shortages pop up, and that’s in the public sector. It is well known that the City of Costa Mesa has had a really hard time filling its many, many vacancies that it has across many vital services. For example, the City Manager had to both raise offered hourly wages and make a big public push to hire personnel for the Parks Department, which has been facing worker shortages for years following the COVID-19 pandemic. We also see this effect in the police department, which, like many Southern California departments, has been hit hard by attrition and poor hiring.

So what happens when the government has a labor shortage? Asking the government to raise wages can be politically difficult, as taxpayers often grumble at paying out ever more of their tax dollars to salaries and benefits. And lowering hiring standards can have really significant costs: not only will public relations suffer, in some instances, hiring incompetent or inexperienced workers can be deadly. Cities provide vital emergency services, in particular police, fire and building inspection services, where mistakes can kill.

So the only responsible option is for cities to simply pare back the services they offer, and I think you are seeing that all across the city. Street safety advocates have been complaining for years that it is nearly impossible to get a speeding or reckless driving ticket in Costa Mesa, and that’s partially because Orange County officers per capita are among the country’s lowest (this dataset pegs it around 10 officers per 1,000 residents; for comparison, my hometown of Durham, North Carolina boasts almost double at around 18 officers per 1,000 residents). Frankly, thanks to our poor staffing, comprehensive traffic enforcement is simply a service we can’t provide. Similarly we are seeing pullback in the policing of our parks, resulting increased calls for vagrancy, graffiti and petty crime.

Budget hawks have also noticed a trend in City Hall: Staff is worried less about funding critical priorities and more about staffing them, with both the City Manager and the Public Works Director more than once indicating that the barrier to completing large capital projects isn’t available funding but available man hours to devote to them.

All of these issues what you would expect to see if we had an under-the-radar labor shortage. And with acute housing shortages, it wouldn’t shock me to find out that this is exactly what is going on. Just another thing to keep an eye on in the new year.

UPDATE: Huntington Beach is welcoming its first partially automated Sweetgreen location, so it’s time to embrace your robot salad overlords! And right on time, the industry is hailing this innovation as a way to combat spiraling labor costs. Hey, as I said above, eliminating jobs is a perfectly reasonable response to a labor shortage. Eventually they’ll find a way to replace the greeters, too.