A Hotel Supporting or Exploiting Workers?

Ideas and Issues
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May 10, 2021

New Orleans

Of course, I couldn’t resist reading a story in the special Design section of the New York Times when I saw “New Orleans” in the subhead of a piece about a new hotel on Magazine Street between the CBD and the Garden District. The name was Travelers New Orleans, and it was the second location, after Clarksdale, Mississippi, in the heart of the delta, for a couple of entrepreneurs based there named Ann Williams and Chuck Rutledge, described as developers.

Their business model was distinctly different. The article claimed that this was an opportunity for artists to do some part-time work, supposedly twenty-hours per week, for minimal pay “that usually adds up to $800 a month,” in exchange for shared living and work space on the third floor where they didn’t have to pay rent or utilities. Focusing on the developers and their architect, who also occupies the bottom floor of this operation, they claimed their operating expenses would be $200,000 per year and with income per room of $185 per night and debt service on a more than $1 million loan, they would still net $80,000 for themselves and their investors. The intriguing hook for the story was the emphasis on this being an artist-centric hotel and an opportunity to provide “creatives” in New Orleans trying to practice their craft affordable living conditions for relatively part-time work.

This was a novel notion and an intriguing business plan, so why was I so uncomfortable that I kept going back to the story and reading it over and over? Sometimes what sounds too good to be true, is really not true at all. Maybe that was what was nagging me?

I went to their website. The Travelers New Orleans recruiting document didn’t align with the Times story. They talked about twenty-five hours of work per week, not twenty. The claim of “usually” $800 per week would be worth $7.44 per hour as wages, above the federal and state minimum, but low even for local hospitality wages. Certainly, Travelers mentioned artists, but their main spin seemed to be for people who were “entrepreneurial” and comfortable with unusual living arrangements, since the kitchen, living room, and deck were all shared. Nothing was mentioned about the length of the work-and-living contract, which seemed strange to me, although the article claims they are tightening their recruitment and screening system.

When I took a look at the Work/Live section on Travelers Clarksdale the model there was about the same expect that in that situation they were contracting the operation of the hotel and related businesses to a local cooperative. The pitch there was that workers, be they artists or entrepreneurs would “own/run” the hotel and the store. Once again, there was some living space offered, but it was “in development”, as they had described for New Orleans.

This might be a fantastic idea, but these developers are not artists or social change folks, but, business people pure and simple. The through line is clear in their commitment to entrepreneurial values first and foremost. I hope this is all on the up and up and works out, but for the life of me it looks mainly like a strategy to recruit cheap labor with a dollop of New Age and progressive sounding marketing to attract guests. What could go wrong? Let’s dial back soon, because I wouldn’t be surprised if just about everything could careen in a different direction than “as advertised.”