Shop talk

SN&R listens in and gets an earful about the tough economy

Before opening his shop a year ago, barber Anthony Giannotti had been laid off twice in 2008. Here, he cleans up after giving a haircut to Phil McNeil, who has been working since April, having spent the previous year looking for a job.

Before opening his shop a year ago, barber Anthony Giannotti had been laid off twice in 2008. Here, he cleans up after giving a haircut to Phil McNeil, who has been working since April, having spent the previous year looking for a job.

Photo By Carolyn King

You don’t need an economist to tell you times are tough. You’re living it. If you haven’t lost your job, your car, your home or your business, odds are you know someone who has. If you aren’t working part time instead of full, laboring at a job that puts your four years of college to waste, or adapting to pay cuts wrought by Furlough Fridays, then surely you know someone who is.

And you’re all talking about it. So to hear what you’re saying, SN&R decided to hang out in the places around Sacramento where you do some of your most serious talking: beauty salons and barbershops.

There’s something about the intimate space of a hair salon that creates an atmosphere where it’s easy to open up and share even the most private thoughts and feelings. When you’re in the chair, it’s all about you, your stylist and the mirror. Trust is present. Their hands in your hair, washing it, shaping it, drying it—what could be more comforting, more personal? Your stylist wants to make you look your best. And he or she doesn’t even care that you looked like hell when you walked into the shop.

Keri Carr, owner of Midtown’s Honey Salon, describes what happens succinctly. “If I open up a little bit, and say something like, ‘Times are tough,’ it opens up a floodgate.”

And it’s no wonder.

Economists have declared an end to the Great Recession. After all, the gross domestic product grew at the blistering pace of 5.7 percent in the last quarter of 2009—the fastest since 2003 and a sure sign that the recession’s end is near. But does that mean you’ll soon feel relief? No, say economists at Sacramento State and the CFA Society of Sacramento, in their recently published “Sacramento’s Labor Market & Regional Economy: 2010 Outlook.” This recovery is not only “jobless,” it’s also going to get worse here before it gets better. The analysts predict that December’s 12.4 percent unemployment rate will reach 13.5 percent before the year is out.

Before being laid off, Theresa Riggs never looked at a price tag. She bought the suit she’s wearing for the bargain price of $39.99 and insists she’ll never go back to spending “willy-nilly.”

Photo By Carolyn King

So it was no surprise, when we listened in at area salons and shops, to hear people from all walks of life talk about the lifestyle changes forced on them by being unemployed, underemployed or struggling to make ends meet with pay slashed by Furlough Fridays. But something did surprise us. We never expected to discover a recurring theme of optimism and confidence emerging from the many life-changing stories you told us.

‘Thank you, economy’

A swirl of energy surrounds Theresa Riggs wherever she goes. With her quick wit, rapid-fire delivery and gregarious openness, the mother of two easily pulls people into her orbit. Stylists at Honey Salon are among those following her ups and downs as Riggs scrambles to find work in pharmaceutical sales.

Laid off in July for the first time since she began working at age 16, Riggs has tackled the job search with a ferocity that’s bound to pay off. She’s sharpened her résumé, networked nonstop and even updated her look with the help of her stylist at Honey. She worried out loud to the crew at Honey: “Does my hair make me look too old? Will people think I’m trying to be too hip with that style?” Then she put her trust in Elena’s hands.

“Elena did an update of my hair,” Riggs said. “It’s really important to get a youthful haircut—it shows that you’re aware and that you do fit in. It’s huge.”

Though not yet old, Riggs talks a lot about being beat out for jobs by “young pretty things.” To compete, she invested in a more youthful wardrobe. In the past, she didn’t blink at paying $600 for a suit at Nordstrom. Now, she’s discovered quality suits sold for as little as $39 at the Burlington Coat Factory. She bought a pair of hip new shoes with toes so pointy her husband jokes she could use them to “kill a cockroach in a corner.”

“Elena wants to do a complete makeover,” Riggs said, adding with a laugh: “She wants to put me in a pencil skirt!”

Despite her good humor, Riggs’ days continue to be fueled by anxiety. Two or three times a week, she wakes at 5 a.m. with a sick feeling in her stomach: “Oh my God. I still don’t have a job.”

For Keri Carr, owner of Midtown’s Honey Salon, there’s something about touching a customer’s hair that makes them feel comfortable opening up about very personal matters.

Photo By Carolyn King

Competition is stiff for the six-figure-salary sales jobs Riggs is chasing—one opening at Amgen reportedly received 30,000 applications. In the seven months since her company was sold and her job eliminated, Riggs has connected with literally hundreds of recruiters. She’s had 50 interviews with companies across the country—more than 15 in person with hiring managers—but she’s ready to get off the interview merry-go-round. “You’re up and down all the time. Your ego keeps getting hurt. You get depressed.”

Across town at Anthony’s Barbershop, red, white and blue stripes spin continuously in a glass barber pole on the wall by the door, mirrors line the top half of the wall beyond two chairs, and Phil McNeil sits looking out the window at the traffic on 21st Street as the 25-year-old owner, Anthony Giannotti, runs clippers along the side of his head. Both men acknowledged they can relate to the ups and downs, the hurt and depression. Before opening his shop a year ago, Giannotti was laid off twice in 2008 and took a blow to his ego: “I always made more than my wife—then I was sitting home watching daytime TV. I’d get up one day and say, ‘OK. Today, I’m really going to do something.’ I’d take a shower, and then by 10 a.m., there was nothing to do.”

“Yeah,” McNeil, 30, agreed. “I have a yard, but after all the yardwork is done, what do you do?”

Working now since April, McNeil spent the previous year drawing unemployment, after losing what he thought was a secure job with a commercial air-conditioning company. He admits a loss of self-regard. “Trying to cash that EDD check, you feel like a scumbag.”

With government jobs making up nearly one-third of the local market, it’s not long before talk turns to the effects of state cutbacks. Cutbacks on state spending stopped one air-conditioning project before it even began, and McNeil was handed a check and a beer when he showed to work. Construction is one of the hardest hit industries in the area. It’s down 30 percent, and one in four construction workers is unemployed. The guys at Anthony’s tell that story, too. From the boss who laid him off, McNeil learned that jobs that previously saw bids from 25 companies now find more than 100 vying for the work. And, McNeil said, they’re bidding only enough to keep their employees working. It’s the same at the drywall outfit next door, Giannotti said. One of his good friends is a general contractor who used to have a crew of six or seven—now he works alone.

“Thank you to our economy” is all McNeil had to say about looking out his window at home one day to see an orange truck driving off with his 2007 Toyota FJ Cruiser, repossessed after he’d already paid $21,000 toward owning the vehicle. Nearly 50,000 Sacramento-area property owners no doubt have offered their thanks—or something else—after being slapped with foreclosure notices last year. So many Sacramentans have lost their homes that the area ranks as the 15th highest in the country for foreclosures, and nearly everyone knows someone whose home is in foreclosure or close to it.

Jeremy Garrett, 32, who’d been sitting on one of two black sofas that face a giant flat-screen TV in the corner of Giannotti’s shop, moves into the chair after McNeil’s hair is gelled and spiked. Garrett is one of some 200,000 state workers earning less because of furloughs. His post-furlough salary doesn’t cover his family’s expenses. They’ve had to dip into savings to survive and are looking for ways to bring in additional income. As an assistant professor of philosophy at Sacramento State, Garrett worries about the impact on students. With hundreds fewer instructors, he said, classrooms are so crowded that students are sitting on the floors. He’s teaching two 80-student courses this semester. Students are working two and three jobs, he said, to pay for their education. “I don’t know when they sleep. How can they learn anything?”

Ray Brown, owner of the King of Curls salon in Hollywood Park: “After Furlough Fridays, the economy changed for everybody.”

Photo By Carolyn King

Back at the Honey Salon, owner Carr, 35, guesses that 25 percent of her customers are modifying home loans, facing foreclosure or flirting with bankruptcy. Carr’s own mother is losing her home to foreclosure. Jay Brown, 62, owner of King of Curls—a tiny two-chair salon carved into a larger shop in Hollywood Park that offers African clothing for sale—said he knows at least 10 families who’ve lost their homes because of Furlough Fridays. As he talks, Brown fiddles with the blue latex gloves he wears, gently adjusting the fingers stained purple from the color rinse he’s applying to a customer’s hair. His voice is so soft it’s difficult to hear as he explains how easily foreclosure can happen in an area where so many people depend on one another: “Some people have two state workers in the same family, and one loses $500 a month to furlough. Another loses $500. That’s a house payment right there.”

Some who have found themselves “underwater” in a market where home prices have dropped 20 percent over the past 18 months have managed to get out with a short sale. A Roseville woman SN&R met at Norma J’s Place in Oak Park had to short-sell her home after being forced to take a lower-paying job.

“For the first time since I was a teenager, I’m a renter,” said the woman who declined to give her name, but said we could describe her as another customer. “That’s a strange feeling. I’ve always been a homeowner—my parents were homeowners. It’s almost like I’m not quite an American anymore.”

Back to basics

Riggs counts herself among those lucky enough to have seen a layoff coming in time to begin cutting back immediately. With only eight years left on the loan on her Carmichael home, Riggs refinanced for another 30 years to lower the payments. The financing came through on a Tuesday, two days before she was handed a pink slip. She also gave up her membership to the Arden Hills Resort Club & Spa and let her housekeeper go.

She wasn’t alone. As the economy tanked, lots of people went back to basics. One of the first things to go was spending on entertainment. Season tickets were given up. Plays, concerts and movies became infrequent luxuries. Sack lunches and dinners at home are necessary alternatives to restaurant meals. Fast food or cocktails taken at home before going out clubbing help stretch shrinking dollars.

Giannotti sold his family’s second car, McNeil hunts for the cheapest price of a gallon of gas, and Garrett bikes and buses to campus.

People who’d never shopped Wal-Mart either out of principle or lack of need now walk through those big-box doors in the hunt for bargains. Riggs, who when first laid off worked obsessively at finding work daily from dawn until midnight, now searches for sales with the same dedicated intensity.

Jeremy Garrett shares a smile with barber Anthony Giannotti.

Photo By Carolyn King

Garrett talks about what “a savvy shopper” his wife is as he checks the trim in the mirror and asks Giannotti to clean up his neck with a razor. Sale-priced canned goods and other supplies are stockpiled under the couple’s bed.

Norman Jean Henderson, 58, uses only one of the two chairs in her Oak Park salon, Norma J’s Place. Likewise, the second sink is filled with supplies and looks unused. The salon is open and light, and it’s filled with ethnic masks and carvings from West Africa and Indonesia, purses and other merchandise that Henderson sells to make ends meet. She massages conditioner into the hair of a customer who sits facing a couch positioned in front of storefront’s window rather than a mirror. Later, Vera Jones will return to the chair so Henderson can work her magic straightening sections of locks one at a time with a hot comb, and steam will rise from her head and she’ll bend her ear forward to keep it from being burnt by the sizzling comb. But before that, Jones sits under a dryer’s hood to let heat boost the conditioning effect and shares tales of her experiences in this down economy. One is the game she and her colleagues at the California Department of Conservation devised to find the best bargains. “We go all around town looking for the cheapest price, and we share it. Messages fly around the office: ‘Stupid Prices—they aren’t stupid. Don’t go there,’” one said about that now shuttered discount store. “We have a plethora of information—here at the salon, too.”

Today, money goes for housing, gas, insurance. Utilities, Jones said, keep going up. She layers on clothing instead of turning up the thermostat and runs her washing machine after 10 p.m. to save on energy costs. “You know all those things you get in your PG&E bill,” she said. “Read them.”

Like Jones, 63-year-old Essie Caldwell has lived through two recessions. “So I know to just cut back,” she said, her head back in a pink ceramic sink in a cramped space lined with shelves stacked with boxes of hair for weaving and braiding. “We buy cheaper meat, don’t eat out. We don’t buy expensive clothes. We can do that because we don’t have to work. Other people can’t cut back.”

Still, the retiree from Lincoln explained, it is tough living on a fixed income. Health-insurance premiums are enormous, even with no pre-existing conditions. Aetna, she said, charges 25 percent more for each prescription medicine taken. Caldwell’s on two.

Hair salons and barbershops are somewhat recession-proof. Eventually, nearly everyone needs a haircut. But customers are not coming in as often, and shop owners blame Furlough Fridays for cancellations and less-frequent visits. Some face competition from stylists working out of their homes or, even, former customers who elect to shave their own heads at home. Brown said business at King of Curls is down by two-thirds. Henderson said Norma J’s is “hanging on by threads.”

“Getting your hair done is not as important as putting food on the table,” she said.

Working on Vera Jones’ hair (above), Norma Jean Henderson (top) says, “When the customer’s in the chair, that’s their time.”

Photo By Carolyn King

Customers haggle with Giannotti over the $14 price for a cut. “Come on,” he said, “I’m cheaper than Supercuts.”

While others talk about enjoying Fridays off since being furloughed, Jones explained that the squeeze of the 14 percent pay cut is extra tight since she must still pay the same amount for health insurance, union dues and retirement plan out of the smaller paycheck. She’s one of the lucky ones who can get by. Pre-furlough, her part-time job wrapping gifts at Macy’s used to put a little extra spending money in her pocket. Now, it pays for her hair and nails.

“I don’t have so much exposure to the public in my state job, but at Macy’s I do,” Jones said. “Believe me, those women look you up and down—you have to keep yourself up.”

‘We’re all in this together’

Since they spend their days listening to customers’ personal stories, stylists have their fingers on the pulse of the community. They’re tapped into common sentiments of their customers, and what they report hearing is not as much about fear and embarrassment or anger as it is about acceptance, relief and even optimism.

“They’re foreclosing on my house, and I’m not too concerned,” said Carr’s mother, Teri Lamade. Joining the conversation in the small back room at Honey Salon where she works with her daughter, Lamade tells of having to find a way to carve out her own private space in a closet while growing up in a house as one of 12 children. It helps explain why she feels that losing her house today isn’t the worst thing that could happen. “I don’t really need a whole house of my own.”

Sure, some panicked when the economy began its slide or as soon as they felt the impact on their lifestyle. Two years into this recession, people now seem to draw comfort in knowing they aren’t alone. They echo the same refrain: “We’re all in this together.”

Brown reports less talk of troubled times among his customers. “What’s there to say?” he asked. “If it’s happening to me, it’s happening to you.”

Pandora Royster is staying motivated and keeping a positive attitude. “We’re making it.”

Photo By Carolyn King

In the midst of this economic turmoil, we heard stories of people leaning on each other to get by. McNeil’s roommates helped him make payments on his FJ for a long as they could; today he drives a car borrowed from his family. Caldwell helps out her son’s family by providing day care. People help Henderson out with things she needs for Norma J’s Place. In turn, she keeps Pandora Royster on her payroll and motivates her to earn a cosmetology certificate.

Henderson and others talk about the stress of owning a small business, especially this kind of shop where worrying about cash flow and sitting idle for hours on end can make it hard to keep up cheerful conversation when customers do sit down in the chair.

“The main thing is not to take problems to the clients,” Henderson said. “When they’re in the chair, that’s their time.

“It’s all about giving,” said Henderson, who credits her deep roots in the community with helping to keep her business afloat. “It all comes back to you.”

Though some still see an every-man-for-himself callousness in some people, Jones talked of witnessing a change. Where before the recession, people tended to keep themselves separate from one another, she finds they now share more and have greater empathy for one another. The guys at Anthony’s mentioned stronger friendships forged as they spend more time together doing things like cooking meals. Riggs values relationships more than ever. She and her husband play Rummikub—a tile-based rummy game—nearly every night. They appreciate every meal.

‘This has changed my life’

With the devastating real-estate bust and state’s $20 billion-dollar budget deficit, recovery in the Sacramento region will lag behind other areas, economists say. In area salons and barbershops, people spoke of riding economic hills and valleys or the inevitable cyclical nature of the American economy. Few, however, expect a return to the way things were before this recession.

Already, local economists put “real” unemployment—people without jobs, working less than full time or for less money, or who have given up trying to find work—at 20 percent. Some of those people may stay in jobs that don’t use their talents or pay enough or provide enough hours. Others—like Brown and Gianotti’s wives who are retooling their skills in computers or accounting—will find new careers.

Stylist Susanna Kuta sets to work shaping Mimi Coughlin’s hair at the Honey Salon.

Photo By Carolyn King

For still others, the changes might mean a drop in social class. Along with his Toyota FJ, McNeil lost his toehold in the middle class when he lost a high-paying job in commercial air conditioning. Today, he earns one-third of that salary—or not much more than benefits paid under unemployment. Gianotti’s next-generation peers who have never before seen a bad economy are learning that entry to the middle class may not be an automatic rite of passage into adulthood.

“It teaches a lot of people in my generation that this MTV lifestyle is not attainable for 90 percent of people,” he said. “You don’t graduate college and walk out and get a job for 80 grand a year.”

While Giannotti still hears plenty of worry, especially from state workers anxious about their futures, there is a general sense in his shop and in most of the other places SN&R visited that things are going to be OK. People are adjusting, and optimism is returning. Customers are tipping again—one sign that times are looking up.

Profitability is starting to improve for area businesses, economists report in the “2010 Outlook.” But even as businesses pick up temporary workers, residents of the region aren’t likely to feel much relief when the corner is turned midyear, because the jobs still won’t be back. Analysts don’t expect the number of jobs in Sacramento to return to pre-recession heights until at least 2013.

Those same economists put a premium on consumer spending, which is responsible for about 70 percent of the economy, in sustaining a recovery here. But from what we heard, some may lack the will to spend even if the money comes back.

When we asked the women at Norma J’s Place if they will go back to spending the way they had in the past when the economy turns around, a chorus of “no” rose instantly from all.

“There’s no ROI,” or return on investment, said the Roseville customer out from under a mass of brown curls as Henderson worked to weave fresh strands onto her head. “Nothing has changed in terms of my health and happiness. A lot of what I spent wasn’t necessary, and I don’t remember who told me it was important.”

Honey Salon’s Sean Kelii understands first-hand the pull of community we find at salons and barbershops.

Photo By Carolyn King

Pandora, a 30-year-old mother of four whose husband also works to support the family, agreed: “I have everything I need. I may not have everything I want, but I have what I need.”

Even when Riggs lands another high-paying job selling cancer drugs, she vows never to return to her old spending habits. “I was one of those people who spent willy-nilly. I’d go to Raley’s and spend $250 twice a week. What a waste.”

As the economy recovers and her pay is reinstated, Jones said she’ll go back to dining out, seeing plays and listening to concerts. “But as far as spending my last dollar,” she said, “I won’t. And I don’t think anybody else will. This is the third time. Next time it might be a depression. You change your lifestyle, and it has to be a permanent change.”

“People nowadays feel that we’ve been consuming, consuming and consuming,” Carr said. Her mother added: “I see a move in consciousness. People are feeling grateful for what we have; they’re finding out that money is not the answer.”

Carr hears stories of customers who long for the freedom to pursue creative interests—even her husband fantasizes about having the time to play his guitar if he were to lose his state job. Some are relieved to be out from under the burden of things—and the need to do what’s necessary to pay for them.

“Did you see that movie Up? It’s like that,” said Carr, referring to the story of how a widowed balloon salesman, who once dreamed of adventure, took flight from his reality by lifting off for the wild unknowns of a South American jungle in his house buoyed by 10,000 balloons.

SN&R was surprised to find so many people wanting to talk about how the recession had presented them with an opportunity to re-examine how they live. With plenty of time on her hands and anxiety to keep a bay, Riggs bought herself “a big, honkin’” cruiser. She hadn’t ridden a bike since age 12; now she tours the neighborhood daily. With the changes she’s made by buying only what she needs and spending less for it, nurturing relationships, following an exercise plan and more, Riggs said she has never felt more centered. “This is actually the best thing that’s ever happened to me—it’s life-changing.”

Recent media reports describe a generation of baby boomers aching for purpose and freedom. Sixty-one-year-old Lamade from Honey Salon sounds like one. Her interests are turning toward working fewer hours and making a greater contribution to society, gaining insight through meditation and enriching her experience of life by traveling. “I want more clarity about what direction we’re going in as a world.”

Wrapped in a black, vinyl apron and wearing plastic gloves, Lamade leaned against the long line of cabinets that keep the salon’s supplies organized in the back room and complained about the steady stream of negativity in the media. Carr spoke of worrying about dwindling oil supplies, wars that might be fought over water, consumption and waste.

This isn’t so bad, she said, as Sean Kelii, 36, and another stylist wandered into the tiny space to join in the discussion. There are so many other stories to tell, they agreed. Indeed, from what SN&R heard around town, despite its hardships, this Great Recession just might be a prelude to a transformation in how and what people do with their money, their labor and their time.