Fast growth has turned Greenville, S.C., into one of the nation’s hottest restaurant markets, adding to the city’s desirability as a place to live—unless you’re working in one of the dining establishments. As restaurants made downtown living more attractive, their employees were pushed out of the local residential market by skyrocketing rents. The workers needed to keep the city a dining destination can no longer afford to live there.
It’s long been a familiar tale of woe in large cities such as New York and San Francisco, or in hotbeds of economic activity such as Silicon Valley and the oil fields of North Dakota. Now it’s being heard loud and clear in areas such as Greenville, which doesn’t even top the ranking of population centers within its own state. Rents there soared 4% last year alone, or 3 times the national average.
Competition for labor has pushed restaurant wages to levels that have employers wincing, but housing costs have also spiked dramatically, further depleting local talent pools. And the last thing an operator in booming Greenville needs is another drain on labor, says Carl Sobocinski, owner-operator of local multiconcept operator Table 301 Restaurant Group.
He’s addressing the housing piece by adding rent assistance to a long list of employee benefits, from paid vacations to a 3% match of employees’ 401(k) contributions and a 30-day paid sabbatical every five years for executive chefs and general managers. Table 301 recently began a program whereby $200 of select employees’ monthly rents will be paid directly by the company in exchange for the beneficiaries’ pledge to stay at least a year.
“I don’t think we took a U-turn from offering competitive and often higher wages,” Sobocinski says in an interview with Restaurant Business, noting that an entry-level hire can usually pull down $9 to $10 an hour in Greenville. “I’ve told our general managers that we’re not going to lose someone over 50 cents or a dollar more an hour if they have the skill sets we need.”
Table 301 can control wages, but not the availability of affordable housing, and much of that has disappeared. “If you’re not making $50,000, $60,000, $70,000 a year, you’re not going to find anything affordable downtown, and I wanted to get our associates downtown,” where most of the company’s eight restaurants are located, Sobocinski says. He contends that immersion is necessary to deliver on the company’s connection with the community it serves, a principle that fits his belief in conscious capitalism, or capitalism with a soul.
He decided to try rent subsidies, albeit on a limited scale. The program is open to only 12 employees, though they can hold any job within the company, from dishwasher on up. And the agreement lasts just a year. The articulated rules and guidelines lessen the chances that Table 301 would be accused of favoritism or housing discrimination, Sobocinski says.
Not all of the 12 slots in the brand-new program have been filled yet, but “the folks who live downtown, they’re so excited,” he says.
The program drew the attention of local media and government officials, leading to the formation of a housing fund to subsidize the rents of others who want to live as well as work in Greenville. Sobocinski serves on the program’s board.
The results have yet to be tallied, but Sobocinski is already convinced there’ll be a healthy return on the $2,400 a month he’ll spend when the program is fully implemented. “For me to invest a few thousand a year to provide housing assistance, that cost is well worth it,” he says. “Just looking around, our turnover is a lot lower than the industry standard. We are fully staffed in our senior level positions.”
He acknowledges that the cost could be a tough one for smaller operations to absorb. “We have the economies of scale,” he says. Plus, “we’re fortunate that we’re in a thriving, booming market. On Monday and Tuesday nights, we’re full.”
Sobocinski said he’d like that success to be enjoyed by others in the organization. He’s in the process of letting key employees acquire a controlling interest in their restaurants. One, Papi’s Tacos, has already been transferred to its namesake, Jorges “Papi” Barrales. Ten percent of a French bistro in the fold has already been sold to one of its managers.
It’s all part of what he says is an effort to more than merely talk about employees being a second family. “This whole notion of the restaurant industry of being a family—it can’t just be a family when it’s convenient for me, the owner,” Sobocinski says.