The "lift all boats" outcome is exactly what activists are afraid of, because if that actually happens it makes the neighborhood "more desirable", and new people will start getting interested in moving in. Those people provide upward pressure on rents.

And once new people move in, they would now be "locals" and eligible for the jobs, too.

There's no logical way to satisfy these anti-gentrification groups because what they're afraid of is quite literally "the neighborhood getting nicer".

Instead of making their cause "keep the rent low by keeping the town crappy", they should make their cause "raise wages so we can afford a nicer town".

That is, if a neighborhood is kind of on the line between okay and bad, this policy might help push it up into okay -- businesses would say, "Okay, there is enough going on in this neighborhood that we can deal with moving into it even if we have these hiring restrictions," and then the hiring restrictions may in fact improve the neighborhood.

But if the neighborhood is solidly bad, the business says, "Let me get this straight: you want us to move into a part of the city where it's by no means clear that we can prosper anyway, AND you want to make it really hard for us to hire people, AND you want to slow down any improvement that our presence may make to the neighborhood by meaning that it all has to be organic rather than imported? HELL NO." And so then nobody takes a chance on really poor neighborhoods and they get worse and worse.

On the gripping hand, I don't think it's a plausible policy in America. It seems outside of the type of business regulations which can actually get enacted.