From: wcs@anchor.ho.att.com (bill.stewart@pleasantonca.ncr.com +1-510-484-6204)
Date: Wed, 12 Jan 94 11:12:10 PST
To: pmetzger@lehman.com
Subject: Re:  underground industry
Message-ID: <9401121908.AA22612@anchor.ho.att.com>
MIME-Version: 1.0
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My three guesses about cash business in New York had been
- retail pharmaceuticals :-)
- politics
- garment industry
all of which have traditionally been off-the-books to large extent.
A friend of mine in NJ had for quite a while been a bookkeeper at small
companies that typically would only hire her under the condition that
she was off-book, and therefore not getting Social Security, etc.

For many companies, though, hiring people off-book is a problem,
because their income is relatively traceable, and they get taxed on
the difference between income and expenses, and payments to suppliers
also tend to be traceable because otherwise the IRS won't allow them.
If you can make your income look lower, by not reporting cash income,
it's not a problem, but otherwise you want the expenses to look high,
and non-reporting suppliers aren't as willing to deal with customers
who have to report transactions.

Another set of trqaditional off-books cash work is the manual labor market -
house cleaners, yard work, odd jobs, evening carpentry; a number of
politicians have been getting stung on these recently.

		Bill