The U.S. Can’t Save Everyone from Creative Destruction

A great story from Marginal Revolution. It’s sad, but the reality is that most of these people will have to move to find a new job.

60 Minutes had a moving piece on Sunday about Wilmington, Ohio where thousands of people are losing their jobs due to the closure of the town’s largest employer, DHL.  Many people had worked at the air distribution center for decades and through no fault of their own were losing their jobs, their health insurance and in one of the hardest losses of all, their community.  Barack Obama and John McCain both talked about Wilmington in their campaigns and yet for all their talk it’s clear that neither monetary nor fiscal stimulus can do much for Wilmington.

Consider the situation, DHL employed 10,000 people and Wilmington is a city of 12,000 (not everyone lived in the city proper).  When DHL leaves there will be no other employer to take up the slack and DHL is leaving.  It’s losing $6 million dollars a day.and closing all of its internal US operations.  No amount of new road construction or school restoration will restore the jobs lost in Wilmington. Banks may lend and interest rates may fall but the airpark is unlikely to come back.  Even when the rest of the economy recovers. will Wilmington?  The sad truth is that the workers of Wilmington are unlikely to ever find new jobs in their old city.
I say this not to argue against a stimulus package, either fiscal or monetary, but to illustrate the limits of what we can expect.  We can do something to ease the transition as workers relocate and retrain.  To the extent that a stimulus works, it will make it easier for workers in Wilmington to get new jobs but these jobs will not be in Wilmington.

2 Responses to “The U.S. Can’t Save Everyone from Creative Destruction”

  1. 1 Kathleen Coker January 29, 2009 at 8:51 AM

    Its horrible to see when a company or business has to close its doors on its employs because of a shortage in money. And as of recent there are becoming more and more towns that are turning like Wilmington because of the poor economic situation that we are in. Which is why it makes scents that DHL (even thought in was a difficult decision)had to cut back jobs. However, it is still sad to see when these things happen especially in Wilmington’s case where majority of the people in the town work work at the same place and all get laid off at the same time (and hurting the town majorly). However the most anybody can do right now is to move on and keep looking for a new job.

  2. 2 el Bouzkouri Youssef March 8, 2009 at 7:57 PM

    yeah i conquer, it is sad. the sad truth is that those 10,000 people who got laid off will be unemployed for quite a while, i mean nobody is hiring right now, and the largest company in their city just closed its doors, where are they going to find jobs? in their city? probably not, they should look for jobs in other cities which makes the task harder because of that and also because in case if they find a job, they should move out of their homes!

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