Gas prices, lack of students hurt businesses in summer

It’s a vicious cycle: Local businesses depend on students to buy their products and students depend on the businesses for income. But when gas prices go up and students go home for the summer, businesses are scrambling to fill the void.

Ed Dutton Jr. and his wife Ybonne Dutton didn’t want to raise their prices at Buck Wild on Foothill Boulevard, but they had no choice. Since opening their store on Foothill Boulevard in October, the couple prided themselves on owning the only dollar store in San Luis Obispo that actually sold everything for a dollar. But the price of gas changed all that.

“Everything is made out of oil – all the plastic and everything,” Ed Dutton said about the store’s products. Ybonne Dutton added that the cost of transporting the products via trucks also became particularly more expensive with the increasing gas costs.

Finally, the couple decided a few weeks ago to raise the price of most of their merchandise to $1.25 (with the exception of the “over $1” section) and waited for the aftermath. But it wasn’t what they had expected.

“We thought it would be a lot worse,” Ed Dutton said. “We gave it a two- to three-week notice and (our business) never changed.”

Brent Goodman, director for Cal Poly’s Institutional Planning and Analysis, said 3,926 students registered for classes for summer 2006. Though this number is greater than last year’s 3,734 students and substantially higher than the 816 students in summer 2004, Goodman said summer quarter has always been around but some summers draw more students than others.

“Everybody’s really supportive of us around here,” Ybonne Dutton said. “We were really nervous about it.”

But there’s one thing they’re still worried about: how the returning students will respond to the prices.

Bill Statler, director of finance and information technology for the city of San Luis Obispo, estimated that about one-third of San Luis Obispo’s population is comprised of college students.

“Obviously, if they’re one-third of our population, they’re a significant part of our economy,” he said.

While that is good news for local businesses, many of them may suffer when students aren’t in school. This summer has been particularly painful for some, as approximately four-fifths of the student population is gone, not including students who stayed in San Luis Obispo for purposes other than taking classes.

Splash Caf‚ owner Joanne Currie also said she has been struggling with student employees. She owns both the San Luis Obispo and the Pismo Beach restaurants and said she likes to hire Cuesta and Cal Poly students.

“The student population is a very important part of our business structure,” she said, estimating that close to 98 percent of her employees are students. Unlike many employers, Currie works with students to provide flexible work schedules around their classes, but even that is failing to entice students when the cost of gas is rising.

“It costs so much to come to work,” Currie said. “Gas eats up their paychecks.”

To deal with this, Currie started hiring local high school students instead and though there are less regular student customers these days, she said she has not seen any significant loss in business this summer because the tourist industry remains strong.

“We have been having a lot of European travelers,” she said. “Gas prices are much pricier there.”

But for many Cal Poly students, gas prices in San Luis Obispo are more than they can handle.

Mathematics junior Casey Ellis is one such student. Ellis stayed in San Luis Obispo for the summer to work and take classes, rather than return home to Saugas, Calif.

Though driving isn’t a problem because she can walk to school and work, she said she has cut down on how much she drives because of gas prices.

“Sometimes I’ll choose to go to the pool instead of the beach because I don’t have to drive,” she said, adding that gas has kept her from driving home as much as she originally planned.

“I pay for my own gas, not my parents, so it gets expensive.”

Like Ellis, biology senior Devon Taylor avoids driving.

“One, I have other ways of getting places; and two, gas prices suck,” he said. “I only put in five bucks at a time.”

Even if that $5 only fills up 1.5 gallons in Taylor’s Toyota Corolla, he said, “That’ll get me by for a week.”