After a Remote Year, Tech’s Shadow Workforce Barely Hangs On

“The pay could end tomorrow,” says Delgado. “You always have a feeling inside of, ‘What’s going to happen? What’s going to happen?’ There’s always anxiety there. You never stop thinking it.”

Homegrown technology companies have created massive wealth in Silicon Valley; by some estimates, the GDP per capita in San Jose is greater than all but the three richest countries in the world. But the money has also brought challenges. The gulf between rich and poor is enormous, and the cost of living has risen so high that even tech workers making well over six figures feel the crunch. Everyone else is barely scraping by.

The region’s large corporate campuses are supported by a small army of workers, most of whom are not directly employed by the tech companies but by staffing firms. Delgado, for example, is employed by Bon Appetit, a food service company that contracts with Nvidia. While the jobs pay more than California’s minimum wage, they’re still considered low-wage work: At the tech companies, subcontracted workers make 70 percent less than equivalent full-time employees, according to research from UC Santa Cruz. And the value of that wage doesn’t go as far in Silicon Valley as it might elsewhere: In Santa Clara, where Delgado lives, the cost of housing has risen exponentially since he moved there decades ago, following his brother from Jalisco. Now, he says, about 70 percent of his income goes toward paying the rent.

In the pandemic, that’s added new anxiety for the lower-wage workers in Silicon Valley. One month without pay can very easily spiral into losing housing, the ability to put food on the table, the loss of the ground beneath their feet. “There’s a lot of fear,” says Maria Noel Fernandez, the director of organizing and civic engagement for Working Partnerships USA, a Silicon Valley labor organization. “There’s a sentiment that there’s a ticking clock. When will their lives be completely thrown apart?”

Alma Cardenas had been bracing for her life to be thrown apart since March. For six years, Cardenas had worked as a barista at Verizon’s hub in San Jose, where she made drinks for the campus’s 3,400 employees. When the pandemic began, Verizon closed its offices. The company continued to pay its subcontractors, like many of the other tech companies nearby, but Cardenas knew the next paycheck was never guaranteed. “Not knowing what would happen next month, or even how to manage that worry—it caused a lot of depression for me,” she says.

In September, Cardenas got the news she’d feared. Her supervisor called to ask for her email, so that she could send Cardenas an official layoff letter. Verizon had ended contracts with 120 of its cafeteria workers. Her last paycheck would come just a few days later. Her health insurance was supposed to end too, but Cardenas’s union, Local 19, fought to keep those benefits for a few more months, until December 2020.

Cardenas lives with her two daughters, ages 16 and 21, in an RV in San Jose. They don’t have a lot of personal space, and everyone’s mental health has suffered in the past year while they’ve been cooped up inside. Cardenas filed for unemployment. Her younger daughter took a part-time job at a nearby McDonald’s to pitch in. It’s still a struggle to make ends meet. While Cardenas looks for new work, she’s doing some volunteering to help people schedule their vaccine appointments. It keeps her mind off of her fears about what’s next.

Cardenas knows her situation isn’t unique. By May of last year, more than 20 million Americans were unemployed. For immigrants and people without a college degree, the rates of unemployment were especially high. The economy has bounced back somewhat since then, but in what some experts are calling a K-shaped recovery: One half of the US is doing OK or better financially, while the other half is falling even further behind. But Cardenas doesn’t understand why Verizon, which ended the year with $31 billion in revenue and dazzling fourth-quarter cash flow, couldn’t afford to keep her on the payroll.

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