Thursday, July 9, 2009

Report on the Economy, via the Hair Salon

There's a price war going among the hair salons and barber shops on Clark Street in Rogers Park, and that's bad news for Alicia, the woman who's been cutting my hair for the last 10 years.

When I stopped in at La Bella Unisex today, she got right to the point. Business is bad. It's not just that people have lost jobs and are pinching pennies; it's the price competition. The place right next door has a big sign in the window: Hair Cut $5. And there's another down the street charging the same amount.

I asked how anyone can make money charging only $5. They can't. With storefronts renting for $1,200 a month, she said, even if you could fill the chairs all day long it would be hard to make it. And the chairs are rarely full.

Alicia asked when I thought the economy would turn around. I told her I've been working on a foreclosure-response project and the experts aren't optimistic; they are worried, in fact, that things could get much worse in some areas as the hundreds of boarded and abandoned buildings trigger a free-fall in what's left of the market.

Why a free fall? Alicia's husband had good work for years doing construction on condominium conversions. But no work lately. Her son, just out of high school, is an apprentice at an auto repair shop on Jarvis. It's a good opportunity but the pay isn't there. And her own business is way down. She's nervous about the family scraping together enough money to pay the mortgage on their own condominium . . . and it's a good bet that the people working next door, at $5 a cut, are having similar troubles.

As Alicia finished up with the razor, trimming the wild hairs off my ears, a man walked in and asked "How much for a haircut?"

"Ten dollars for a normal haircut," Alicia replied, sizing up the potential client. She hesitated a split second, then added, "and if you need just a simple cut, five dollars."

"Yes, just a simple cut," he replied.

So that's the view from Clark Street, where people are hurting.


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