A friend of mine, Jesse, who is one of the most creative people I know and is always coming up with new, innovative ideas put me onto this story. It’s from New York Magazine and looks at how New Yorkers make money. They look at 21 different New York business jobs, how much money they make, and what you can expect in that particular industry. They look at everything from drug dealers and cabbies to museums and baseball teams.
Here are samples of 3 of the profiles I found interesting:
1) A Yellow Cab Driver
- Have no control over prices, they are set by the city
- Annual Revenue: $75,000 ($12,000 profit before tax)
- Most profitable fares: long distance trips with little traffic
- New Yorkonomics: Taxis become economically attractive when the cost of paying someone to drive for you is less than the costs of storing your car. New York’s high price of land makes parking so expensive that there’s enough demand for an army of Samuel Pekohs (featured cabbie in story).
2) A Drug Dealer
- Convicted crystal-meth dealer explains how he ran his business
- Annual Revenue: $1.02 million ($813,600 profit and paid no taxes), worked 15 hours per week
- Most profitable customers: Wealthy professionals who are hard-core addicts. They are discreet and always pay.
- Least-profitable customers: Friends. “Nightmare customers are your closest friends. They don’t have a problem calling at 6 a.m., and they expect low prices.”
- New Yorkonomics: With data on petty drug dealers, the economist Steven Levitt has taught us that there is an abundant supply of people willing to work in the drug industry at near the minimum wage, so why does this guy make so much? His high earnings flow from a type of social capital that is in short supply on the streets of Harlem: This dealer has the connections to cater to a well-heeled clientele that is willing to pay extra for a discreet and reliable dealer. Of course, since someone with his social skills could also earn a living without breaking the law, his high earnings from meth dealing also provide compensation for the risks of going to jail
3) A Copy Shop
- Just need an office and leased copiers at $500 / month to start
- Annual Revenue: $192,000 ($42,240 profit)
- Most Profitable Offerings: Restaurant flyers. Local restaurants order 1,000 new flyers every three days.
- New Yorkonomics: Business services like this copier have replaced light manufacturing as the backbone of New York City. Abundant copy shops thrive because smaller New York firms don’t want to lease their own copiers or pay for the space to house them. These business services help make the city an engine of entrepreneurship, because start-ups can buy services from freestanding suppliers, instead of buying their own equipment.
Thanks for the lead Jesse!
Evan Carmichael
