> ## Content Index
> Fetch the complete content index at: https://www.smdp.com/llms.txt
> Use this file to discover other available public pages before exploring further.

# Susanne Trimbath: Santa Monica's retail choices are foolish for its economy
- URL: https://www.smdp.com/santa-monica-2/
- Published: 2005-05-12T15:00:00.000Z
- Updated: 2026-10-25T00:02:53.000Z
- Author: Guest Author
- Tags: Business, Santa Monica, #archive-import

*Smart city, foolish choices*

*By GUEST COMMENTARY BY SUSANNE TRIMBATH PH.D.*

Santa Monica is considered by many to be a very smart city: We recycle, use natural gas for our buses and encourage the use of bikes for local transportation. Even our new library is smart: It will capture and store rain to maintain its plants, and the window coverings will be automated to help control the temperature of the interior. But our choices of which retail businesses to have here are very foolish. Santa Monica has encouraged the opening of businesses which are in industries that create lower wage jobs. Meanwhile, we have discouraged business in those industries which create higher wage jobs.

According to data from the Bureau of Labor Statistics, the cost of labor has been increasing in the U.S. over the last 10 years, with the exception of 1994 and 1996 when unit labor costs actually fell. Retail stores, on the other hand, which play an important role in Santa Monica’s economy, have not fared as well. Unit labor costs are down slightly over the same period.

While “general consumer retail” is the city’s largest tax-generating business group — based on fourth quarter 2004 figures) — employers in “clothing and accessories” and “miscellaneous retail outlets” were ranked among the top 10 businesses hiring in Santa Monica in 2003 (latest available). There are 268 employers in Santa Monica that fall into those two categories of retail. But the story isn’t so much about how the companies are doing or how much sales tax they are generating. The real story is about how the employees are doing.

A shrinking percentage of Santa Monica residents work here: from 35.5 percent in 1980 to 32.2 percent in the 2000 census. With 47,059 employed residents, that means that 15,153 of the 75,083 jobs in the city are held by residents. By simple math, it would seem that only 20 percent of the people who work in Santa Monica can afford to live here. Although a more complicated calculation would probably prove otherwise, everyone knows that the only thing better than living in Santa Monica is living and working in Santa Monica.

The point is that we need to be thinking about the kinds of jobs we bring here when we make choices about which businesses we want to encourage locating in the city. Those jobs that pay higher wages are more likely to enable workers to live in the city, too. In addition to the obvious benefit to the worker, we would all benefit from the reduction in traffic and congestion that could come with encouraging job growth in industries where employees make enough to be able to live here, too.

The focus now is on retail, especially given that we are in the planning stages for the new Santa Monica Place. The foolish choices? We have long discouraged Target from entering the city, despite that general merchandise stores have one of the stronger labor cost figures. Maybe for different reasons, but we also lost the Midnight Special Bookstore and Fisher Lumber, another set of stores in the retail sectors with strong labor cost figures. Although Fisher Lumber was lost through a corporate decision — an employee told me there were owned by a larger corporation — maybe the city was a little too anxious to get the land. It’s possible they could have done more to try to keep that business, and those jobs, in the city limits.

On the other hand, we recently encouraged Staples and Circuit City to open stores in Santa Monica. Of the retail types discussed here, office supplies and consumer electronics have some of the lowest unit labor costs. Great for their corporate headquarters (Framingham, Mass. and Richmond, Va., respectively) but bad for Santa Monica’s labor force. (Susanne Trimbath, Ph.D. is senior research economist at STP Advisory Services, LLC. To reach her, )

*Originally published in the Santa Monica Daily Press print edition on May 12, 2005.* [Read the original PDF.](https://s3.us-east-1.amazonaws.com/smdp%5Fbackissues/051205.pdf?ref=smdp.com)