Private bus routes that inspired rowdy protests around Silicon Valley in recent years will now deliver some shared prosperity in that booming but divided region. Drivers on the routes are seeing their wages and benefits increase dramatically thanks to unionization and contract negotiations.
The latest progress comes from a contract ratified Sunday by drivers from Compass Transportation, one of several bus companies that tech giants like Google and Facebook hire to ferry their highly paid workforce to and from the office. Compass drivers’ hourly wages will rise across the board, locking in significant raises that tech giants who rely on the buses had begun extending to drivers earlier this year in response to critical scrutiny of how the routes operated.
The contract agreed to Sunday also grants Compass drivers paid holidays, a far more generous health insurance cost split with Compass, overtime pay, and clear processes for adjudicating workplace disputes.
Compass drivers’ wages previously ranged from $17 to $21 per hour, but under the new payscale driver Tracy Kelley will see his pay jump from $18 to $25 per hour. It’s unclear how representative Kelley’s case is of Compass’ staff, but that example roughly mirrors the average pay raise another group of drivers won from Loop Transportation in their own union contract back in February.
Both companies’ drivers joined the Teamsters as protests and media scrutiny put pressure on tech firms and bus vendors alike over the past few years. Protesters arguing that the buses contribute to rising inequality in the area took up bombastic tactics, laying siege to buses full of commuters on multiple occasions and in at least one case intentionally vomiting on a bus’s windshield. The San Francisco Chronicle profiled one driver who became homeless because his wages fell far short of what’s required to pay rent in the superheated economy surrounding America’s technology incubator.
The buses were an easy flashpoint for long-simmering tensions over how tech companies and their sub-contractors divvy the rafts of money flowing into the area. They served to separate relatively wealthy tech professionals from the commuter streams everyone else has to use, and the people who drove them didn’t were paid too little to afford to live in the area.
Prior to the bus dustup, attempts to steer the region in a more sustainable direction have been few and fraught. Even the most modest efforts to harness tech riches to the public interest drew stiff resistance, as developers fought in court for six years to nullify a San Jose law requiring them to dedicate a modest share of their new construction to affordable housing. Santa Clara County has been spending more than half a billion dollars each year jailing, hospitalizing, and trying to provide services to tens of thousands of homeless people.
The area’s extreme inequality is rooted in the gigantic gap between how blue- and white-collar workers are treated in the region, even when they’re ultimately serving the same masters. No matter how talented their coders or how visionary their product ideas, tech sector companies couldn’t succeed without small armies of janitors, food court workers, security guards, and other service employees. That “invisible workforce” of contract employees earns far less than the white-collar professionals they serve, and whose compensation is so high that it’s pushed up housing costs for everyone trying to work and live in Silicon Valley.
The drivers’ union campaign and contracts are an example of the liberal economic argument in action. Silicon Valley has experienced absurd economic growth, but that growth has been malapportioned in ways that make it impossible for the majority of working people to share in its bounty. In the absence of union representation for the most economically vulnerable participants in a system that’s generating huge overall wealth, the region’s middle class has shrunk rapidly. The same phenomena have been playing out in less stark ways throughout the broader national economy over the past few decades, with declining shares of economic output going to working people despite productivity increases.
The drivers’ organizing successes will help strength the middle class in the Valley. States with relatively high union density also have relatively strong middle classes. That benefits both the very wealthy and the very poor in multiple ways. First, middle-income consumers are the main engine of overall economic growth. Second, higher economic security for people in the middle breeds greater human capital for their children, who become better equipped to both participate in and lead the economic innovations that shape future growth.