Notes From the Underground Economy
Fortune Small Business
An army of undocumented workers is making it tough for legit businesses to compete. The coming crackdown could be even worse.
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By Josh McHugh/San Francisco
May 1, 2005
Gary McLaughlin, an electrical contractor in San Francisco, recently got a call from a real estate agent who needed a house rewired before its new owners moved in. He checked out the house and faxed in his bid. McLaughlin, 31, employs two electricians and a bookkeeper and says his bid was about 25% less than what larger contractors would charge. But it wasn't low enough.
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Later that day the agent called back and asked McLaughlin if perhaps he'd made a typo on his estimate. "I have two other bids here," she said, "that are half what you're asking." The difference, McLaughlin told her, is that he has a license and pays workers' comp insurance and payroll taxes on his employees, who are in the country legally.
"Well, that isn't my problem," the agent said. McLaughlin lost the job.
