Detroit’s lessons for industrial America
Dante Chinni
Posted: 10.05.2009 / 7:53 AM PDT
Detroit is in the news again, amid last week’s revelations that US auto sales dropped by 41 percent in September and Michigan’s unemployment rate hit 15.2 percent – the worst of any state in the nation.
The retrenchment of the auto industry is remaking the Detroit metro area, and looking at Detroit through the scope of Patchwork Nation shows just how broad the impacts of the city’s epic struggles have been.
While every city is unique (and most cities didn’t rely so heavily on manufacturing or one industry for survival), there may be warnings wrapped in the Detroit crash for similar places elsewhere in Patchwork Nation.
Not just the city
First off, the malaise in Detroit is not just about the city proper or the Big Three automakers. True, Detroit and its abandoned buildings are eyesores and catalysts for crime. But many inner-ring suburbs have also taken a hit as auto suppliers and shops suffer from the knock-on effect of the auto crisis.
In August, 5,600 homes were in some state of foreclosure in Wayne County, Detroit’s home. But just to the north in Macomb County – blue-collar suburbs – 2,200 homes were also in some state of foreclosure.
While the July unemployment rate for Wayne County was 19 percent, in Macomb, that number was 18.6 percent. To the west, in Oakland County, home to white-collar suburbs, the rate was still 15.5 percent.
In Detroit, even people who don’t work for the Big Three or their suppliers rely on them. Everything from real estate values to retail has taken a hit. Driving the streets of the northern suburbs – Warren, Center Line, Sterling Heights – it’s impossible to miss the vacant storefronts.
The larger meaning
Detroit’s example can be easily overlooked as a worst-case scenario. But there are messages in Detroit’s collapse for other “Industrial Metropolis” counties where the manufacturing cores are hollowed out.
Look at Philadelphia. Along Germanton Avenue, tree-lined streets of nice homes give way to struggling neighborhoods and urban decay that look very similar to Detroit. The same is true across the Delaware River in Camden, N.J.
July unemployment rates in these counties were well below Detroit’s – both just under 11 percent – but they were above the national average of 9.4 percent. As we noted last week, the Economic Hardship of the past year has hit the big cities of the “Industrial Metropolis” especially hard.
Philadelphia has come much farther than Detroit in moving beyond manufacturing, but the problems of those disappeared manufacturing jobs – low-skill, poorly educated workers making less money – remain.
The economic downturn has helped deepen those problems as the lower-paying jobs that replaced the manufacturing jobs have also been hit hard.
Last week, two professors at Rutgers University in Camden released a report saying that, considering the number of jobs lost in the recession so far and the projected recoveries, a jobs deficit may exist in the United States until 2017.
In other words, while Detroit’s problems are particularly bleak, they are not remote. Detroit may be suffering the most, but other “Industrial Metropolis” localities are facing the same challenges.
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