03
Business Impact
1,500
San Francisco businesses at risk of downsizing or leaving San Francisco because of Prop D tax increase.
7×
Wage losses in grocery and retail compared to the SF economy-wide average.
Business & Jobs Impact
When grocery stores can't absorb a major cost increase, they respond by cutting jobs, reducing hours, or closing locations entirely. Those impacts ripple through San Francisco's economy, affecting workers, neighborhoods, local businesses, and city revenue.
When stores can’t absorb the cost of a tax increase, jobs and services get cut
Grocery stores already operate on razor-thin margins. When costs rise this sharply, stores respond by cutting jobs, reducing hours, or closing locations.
What Happens Next
Grocery stores run on tiny margins
1.3%
A much larger tax bill hits those margins
Up to 25% profit reduction
Stores are forced to respond
Fewer jobs • reduced hours • store closures
SF establishments at risk
1,500
As costs rise, grocery stores may downsize, close locations, or leave San Francisco entirely.
Larger wage losses in grocery and retail
7×
Grocery and retail workers are modeled to bear the largest wage impact compared with the SF average.
Reduced wages shrink consumer spending across SF’s economy
When families pay more for groceries, they spend less at local restaurants, shops, and services. Low-income families spend nearly everything they earn, so every extra dollar on groceries is a dollar pulled directly from SF’s local economy. Higher-income households tend to save a larger share of their income, so their spending usually doesn’t change.
Total Reduction in Economic Spending per $1 of Lost Income by Income Group
When low-income households lose $1 in income, total spending in the economy declines by more than 2x.
As middle-income households lose $1 in income, total spending in the economy reduced by an equivalent amount.
As higher-income households tend to save a larger share of their income, overall economic impact is more muted when their incomes decline.
These effects are estimated on an annual basis, reflecting how income changes translate into spending within a given year.