Who Can Afford Manhattan?

Executives of Fantus Co. have helped so many companies find sites for new plants or offices that they have built the world's largest industrial location service. Last week they concluded that they have been in the wrong place themselves. They decided to move Fantus' headquarters out of Manhattan to South Orange, NJ.--following such firms as General Foods, American Can and PepsiCo, which have shifted large operations outside the city.

New York City, says Fantus President Leonard Yaseen, is just no place to work. Yaseen gives it a low rating for reasons as varied as crime, air pollution, strikes, employees' attitudes toward work and operating costs. He cites high and rising city income and occupancy taxes, as well as office rents of up to $15 a square foot in midtown Manhattan v. $7 in the suburbs. Clerical workers commonly put in only 35 hours a week in Manhattan v. 40 in some nearby towns, and their turnover rate averages 34% a year, against 15% in Stamford, Conn. Worst of all, Yaseen reports, it is becoming almost impossible to attract middle-level executives to New York, because living costs average 40% higher than in, say, Dallas or Nashville and 12% higher than in Chicago, Los Angeles, Philadelphia and Detroit. He figures that in the next ten years, "advertising agencies, banks, brokerage houses and shipping companies will not move out, but it is likely that many of the others will."

The city's economic development administration has tried to dismiss Fantus' move as a publicity stunt. The administration's chief, D. K. Patton, a former Fantus vice president, suggests that Fantus thinks it can boost its business by persuading companies to relocate. Outside opinion tends to support Yaseen. The National Industrial Conference Board reports that the chiefs of some major companies are thinking of offering executives whom they try to lure to Manhattan a "New York cost-of-living differential."

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