Are Philly's many hiring laws really driving employers away?

012717_jobinterview_600
City Council keeps coming up with special new rules for employers. Last week, after Mayor Kenney signed Council's unanimous measure ordering bosses not to ask applicants' salary history -- over objections from Comcast, the largest corporation still based in town.

Donald Trump's triumph in the presidential election and voter support for Republican control of Congress and the General Assembly in Harrisburg seem to have encouraged Philadelphia business to speak out more against a City Hall that keeps setting new rules for employers. 

Philadelphia's building boom has been led by apartments, nonprofits, and some publicly subsidized corporate musical chairs. Big for-profit employers aren't flocking here or boosting wages. Center City can feel a bit like a bedroom suburb in the morning, as trains carry workers to jobs out of town as well as in.    

But City Council keeps coming up with special new rules for employers. Last week, after Mayor Kenney signed Council's unanimous measure ordering bosses not to ask applicants' salary history -- over objections from Comcast, the largest corporation still based in town -- Chamber of Commerce president Rob Wonderling complained that "the city of Philadelphia continues its record of passing legislation that hurts job growth." 

There is "no evidence" this latest law will boost anyone's pay, Wonderling said. "This measure says Philadelphia is not open for business," he added. It "reinforced our unfortunate antibusiness reputation of having a city government that tells companies how to run their business."

Philadelphia "is quickly falling off the list” of places businesses want to locate, due to the "cumulative effect" of "restrictive, anti-job growth measures taken up by city government over the last few years, Wonderling said.

He listed them:

  • In 2011, a "Ban the Box" rule limiting bosses' right to ask whether job applicants had ever been convicted of crimes; in 2015, an extended ban. 
  • In 2012, a "First Source Jobs Policy" setting up a registry of unemployed Philadelphians for city-aided businesses to prefer.
  • In 2013, a requirement that contractors count female officers and managers, and plan for more; plus legislation restricting bosses from checking workers' social media. 
  • In 2014, a $12-an-hour minimum wage for city contractors.
  • In 2015, mandatory paid sick leave; and a "wage-theft law" imposing higher penalties than state law.
  • Last year, limits on employer credit checks for prospective hires, and another boost in the city contractors' minimum wage.

Comcast may be the company with the most at stake, since it's building another office tower to fill. What is it going to do? Walk away?   

But are the chamber's claims any more accurate than City Council's? Can we name employers that won't come downtown because of hiring rules east of City Avenue, west of the Delaware River? As old labor-union states like Michigan are passing anti-union laws, are attempts at social improvement really driving Philly jobs away?

Vanguard Group isn't scared. The mutual-fund giant, which employs more than 10,000 off the highway exits of Chester County, where a lot of bright young college grads don't want to live, is still "planning as scheduled to move forward with the Innovation Center" it plans for Philadelphia, spokeswoman Arianna Stefanoni Sherlock told me when I asked about the chamber's complaint.

CEO recruiter Judith von Seldeneck, who agrees with Comcast and Wonderling, acknowledged that she couldn't name a company that actually went elsewhere because of hiring laws (as opposed, say, to Philadelphia's long record of high business and employee taxes). 
 
Maybe they're shy. I heard Day & Zimmerman, one of the city's largest private companies, is debating whether to expand on Spring Garden Street or down in Chester City, which has just cut business-tax rates. But boss Harold Yoh wasn't available to talk about his choice.

Liberty Property Trust is building offices on Camden's waterfront. Boss Bill Hankowsky was unavailable to say whether tenants tell him Philadelphia's special employment laws are driving them over the water.  

But at least one member of the city administration said the chamber is right. "I try to be an unvarnished person, with full transparency," Harold Epps, a former top executive of services contractor PRWT Services and now Kenney's commerce director, told me.

Several Philly factors make it tough landing employers, Epps said. "We are making progress" reducing business tax rates, "but not fast enough." The public "shared space" in Center City and other neighborhoods is suffering "an uptick in homelessness, panhandling, and theft at levels that were not there a year ago."

And, as to "the perception by the business community of over-legislation and over-regulation," Epps said: "As a past business owner, I agree with that. Yes, the business community has their temperature up. And I would say, rightfully so."

To get companies to stay and grow in Philadelphia -- and to come here -- "we have to be vigilant about creating a pro-business climate that makes us attractive," Epps told me.

An independent labor policy isn't getting us there, he concluded: "We have a lot of work to do." 

Continue Reading