New York City wants to regulate non-union hotels and drive up their costs by banning outsourcing of key functions like housekeeping and food and beverage. This make workers easier to unionize and bringing on full-time employees is often more expensive than buying just the hours you need.
In that way, non-union hotels become less competitive, it’s less attractive to stay non-union, and it becomes easier to organize a hotel. But driving up costs will put some properties out of business. And New York City hotel room inventory is very tight.
- Hotels have been repurposed to house migrants (over 10% of all rooms)
- The city has largely banned Airbnb
- And new hotel construction has been limited, with hotel workers unions given an effective veto over projects
That helps explain why “Average room rates are up 22.5% from 2019 and hotel occupancy was roughly 80% through May” despite business travel not having fully recovered, especially on the coasts, and leisure destinations generally outpacing top urban locations otherwise.
The hotel workers union in New York City yields outsized political influence, blocking projects that would turn hotels into residential housing or homeless shelters. That helps keep rents high and people on the streets, but protects jobs. It also ruins hotels.
The New York Times summarizes their power.
The Hotel Trades Council ranked among the top independent spenders in the election cycle of 2017, when all 26 City Council candidates endorsed by the union won. Some of these officials ended up on powerful land use and zoning committees, giving the union influence over important building decisions in New York.
The union says that the bill is meant to crack down on crime, which is an odd thing for a union to worry about when their own members aren’t on premises. It’s also strange to believe that small hotel operators will do a better job at security than contracted specialists.
More likely, crime isn’t a function a outsourcing housekeeping but of the people attracted to lower-end hotels. It is also an issue at the hotels the city is renting for migrant housing. With crime as a fig leaf, the union isn’t shy about saying the likelihood that imposing higher costs shuts down these properties is something they view as a positive.
(HT: @crucker)
Why would anyone want visit NYC…unions are hurting the city!
We just need to outlaw unions! The country would be a much better place
Average hotel room costs for my vacations in areas of the US where there has been no increase in recent migrants being housed locally have gone up far more than 30% over the last 5 years.
A 22% increase in NYC rates doesn’t sound awful given what I’ve seen of hotel rates what I’ve seen of hotel rates elsewhere in the country and around the world. If anything it speaks to an economic sweet spot and a great economy having been delivered to the country now that the Biden Administration’s efforts have come to fruition.
Capsule Hotels has entered the room to provide a solution
If you want a premium flight experience from JFK, please choose Delta.
Gary, you and every other well-traveled person knows this–NYC is America’s only globally competitive city. The demand will always outstrip supply. Until American democracy collapses and the global epicenter of culture and finance shifts to the eastern hemisphere–which may be 10 years, 100 years, or 1,000 years away–whatever unions do or do not do, hotel rates will remain sky high.
@SFO/EWR
Are you writing us from the 1970s?
The stream of Fortune 500 companies OUT of NYC continues unabated.
LA, Dallas, Miami all dominate now in sectors that used to be New York’s.
NYC’s governance and judicial systems are firmly anti-business, so tell me again WHY they think they can defy gravity?
After decades of living and visiting NYC I’m kind of over it
I will go back though rarely as I can get most anything they offer for less
in most other cities.They won’t be getting my dollars anymore or very rarely.
Greed everywhere fees prices etc
For those that desire or have to go good luck! What a mess
Don’t miss it.Was there back in the best of times good memories though
If this is what NYC’s council really wants to do this to businesses there than I can see over the next while a lot of business owners will decide to close up shops because to them it wouldn’t be worth wasting money running a business in such a hostile situation like that. Not to mention here, you’d also have to include shareholders as well ! They would also pull their funds from projects & businesses alike because to them it wouldn’t be worth it wasting their hard earned money on businesses or projects,especially if they are gonna get screwed. Everyone will literally take their business else where and then NYC will be the ones left with No good businesses to speak of due to their Corrupt city council
“ONLY” globally competitive city? Miami, L.A., Seattle, and a few others would like a conversation outside, please….
NYC nowadays is so “bad” that housing costs 3-4 times the cost 30 years ago and even now is 2-8 times more expensive than in areas that have the highest proportion of the voters going for MAGA Lord in elections. The market says NYC is still very high in demand. And it’s definitely nicer now than what it was like during the Reagan-Bush and Bush-Quayle years.
“We just need to outlaw unions!”
The problem isn’t a union of employees, it’s government protection of a union of employees. In a free society, all the challenges created by unions wouldn’t exist.
NYC like Disney is already too expensive to visit. Cheaper to go to Europe or Mexico, and you can find the same shopping in any one of a dozen world class US cities. Most Broadway shows have a traveling cast as well.
I hope NYC hotel workers have a decent base wage now because they won’t be getting tips from the migrants. And I’d imagine the rooms are bit worse to clean.
I guess the high end restaurants and hotels don’t care so long as they are full. But eventually the migrants will be gone and the office workers have still not fully returned.
Ditto what dwondermeant said
What this will do is shorten my stays in NYC. I will tend to still go there but stay fewer days or stay some days outside of NYC. This has happened with some cities with very expensive hotels.
Don’t you know the crime rate’s going up, up, up, up, up
To live in this town you must be tough, tough, tough, tough, tough, tough, tough
You got rats on the west side, bed bugs uptown
What a mess this town’s in tatters, I’ve been shattered
My brain’s been battered, splattered all over Manhattan
Shadoobie, shattered, shattered
What say?
Shadoobie, shattered
Shadoobie, shattered,
Shadoobie, shattered, uh-huh,
This town’s full of money grabbers
Go ahead, bite the Big Apple, don’t mind the maggots, uh-huh
Has this blog turned into a Fox subsidiary? Get a life.
NYC is and always has been hated and reviled by the right wingers who claim it is a “cesspool” on the verge of death. Somehow, it remains head and shoulders above every other American city in population, culture, business, and tourism. Something about minority people, immigrants, unions, foreigners, tolerance, crowds, queueing, etc. seems to just trigger them.
If you all refuse to visit, both New Yorkers and those of us non-New Yorkers who enjoy NYC will thank you for your absence, leaving the city to us. Have a nice visit to OKC. (And actually, I liked OKC too.)
I guess jokes on us. This is what socialism gets you – crony capitalism. Such a disappointment.
Just like the unions, the demoncrats are destroying our America. Show them all no quarter.
Unions are making the country worst.
Now that you have read the propaganda from the fans of the convicted criminal running to become President again, let’s provide some facts for comparative evaluation:
that the current President’s Administration has brought unemployment way, way down from what it inherited on Inauguration Day in 2021;
that the stock market has set new record highs under the current Administration;
that the US economy is the envy of the world and has outperformed all the other G7 countries under the current Administration; and
that the growth in government debt as a proportion of our economy has been slower under this Administration than under the prior Administration run by the repeatedly bankruptcy-filing billionaire con-man known as “The Donald”.
Fan-boys for mergers and accusations and higher tariffs are what drive up inflation in America — and that’s what that clown Trump Administration gave us on his way out the door last time and will give us again if he’s allowed back into the White House instead of being flagged as a persona non grata for both his criminal ways and gross incompetence before.
The so-called crony capitalism goes on steroids as part and parcel of MAGA world and Project 2025, and it’s why many billionaires are backing Ye MAGA Lord and even those who are not want more corporate apologists in power than is currently the case.
@GUWonder – I’ve been a consistent critic of Trump, very publicly on this site, for a decade. However your framing is incredibly disingenuous. Unemployment, stock market, and government debt at the end of the Trump administration were a function of the pandemic. There’s no plausible story where they would have been better had Biden been President in 2020, nor where they wouldn’t have improved under a second Trump administration.
While I’m equally a critic of tariffs, those were not in any sense what drove higher inflation (here, or in Europe either!). Inflation was a function of more money outpacing growth of goods in the economy. The biggest contributor to this was pandemic-era zero interest rates from the Fed, but contributors were increased government spending under Trump and then Biden (the latter without pandemic justification).
Crony capitalism is equally a feature of the past two administrations.
I’m with a number of the commenters, most of America’s major Blue Cities are no-go zones due to high costs, homelessness, and large amounts of crime. BTW, a new virtual Stock Exchange is already being proposed for Dallas, it may take 20 years, but NYC’s lock on the exchanges is not a certainty.
No interest in visiting NYC (I need good pizza) anyway. And, GUWonder, I laugh at all the pro-Trump idiots rant about his “greatness.” Thanks for letting me have a laugh at someone ranting for this failed administration.
“you and every other well-traveled person knows this–NYC is America’s only globally competitive city” I just love absurd comments.
Some charts and chart commentary to compare the economic situation under the current Admin vs the prior Admin:
https://www.washingtonpost.com/opinions/2024/07/18/trump-biden-economy-charts-compare/
The Democrats have been generally better for the economy than the Republicans since before you (and probably nearly all of the commenters here) were born, and that dynamic hasn’t really changed since the world was gifted with you. Then the argument may be who is riding on who’s economic coattails and screwing the pooch for the next Admin.
The inflation situation in the country lands heavily on the Republican-heavy Federal Reserve Bank’s board of governors as masters of the money supply. They are most certainly not the “socialism” lot, but they (and the IMF) certainly are the American bankers’ proverbial best friend.
Contributors to inflation were the big boom in demand for labor and labor being in a better position to demand better pay and work conditions. Would you prefer much higher unemployment and the often associated increase in violent crime that is part of higher unemployment just so we can have 1-5% interest rates on our savings and money market accounts? Not I.
Reported violent crime in the country is at near a 50-year old low under this Administration. That too probably should be taken as a sign of economic success.
Will Dave W be able to present examples of how this Admin is more failed than the prior Admin? I don’t see it, and I have my own litany of criticism for the Biden Admin and am no fan of Harris. So unlike the thousands of dollars in donations that Trump and his favorite daughter made to Harris before most people in America had ever heard the name Kamala, I won’t donate even a penny to the Harris campaign.
@GUWonder “Contributors to inflation were the big boom in demand for labor and labor being in a better position to demand better pay and work conditions. ”
One piece of inflation was limited labor supply given alternatives, which held back productivity, and therefore lower quantity of goods relative to money.
“Would you prefer much higher unemployment” no, but in fact unemployment AND labor force participation were down
Labor force participation was down in the country — what else can be expected when schools were shut down in the land of expensive/unaffordable (and shut down) childcare and of too many sleazy and poorly managed nursing homes during a pandemic — but was that really a bigger factor in high inflation hitting goods in the US as the disruption of international supply chains? I have my doubts about that. And disrupting/unwinding “globalism” creates longer term inflationary pressure that is more stubbornly resistant to monetary policy refinements. Protectionism and crony capitalism is at the heart of the Tr*mp-Van ce Party that the Club of Growth and Project 2025 types are supporting nowadays.
@AC – “We just need to outlaw unions! The country would be a much better place”
The children yearn for the mines!
@Gary – “More likely, crime isn’t a function [of] outsourcing housekeeping but of the people attracted to lower-end hotels. It is also an issue at the hotels the city is renting for migrant housing.”
Is the implication here that the migrants are the cause of increased crime? Or that the hotels being allocated tend to be lower-end, in less-affluent and more crime-prone locations?