Car Towns are at Risk

Posted by: Thomas Gillick

Many people look at what is going on in the automobile industry and only think about the falling stock price and the chance of going bankrupt. The problems in the automobile industry not only have a dramatic effect on Wall Street but also dramatically effects small towns. Usually the same employer employs people who live in small towns. The problem with this is when the industry is doing bad or the company is in financial problems they start cutting jobs. This could dramatically affect the unemployment rate of the town causing the town as a whole to enter a financial crisis. This notion is getting stronger and stronger as the automobile industry is getting worse and worse. A small town in Indiana currently has a unemployment rate of 20% and most of those who are employed work at a Chrysler factory. If this factory shuts down that will destroy this town. Also many of these workers feel that filing for bankruptcy is not the answer. People in this town feel that bankruptcy is really union busting since most of the workers will have to renegotiate their contracts and settle for a lower salary and worse benefits if they even still have a job. The automobile crisis is not only affecting the investors but its affecting families and car towns that are dependent on automobile manufacturing plants.

Sources:
http://money.cnn.com/2009/04/21/news/economy/kokomo_auto_workers/index.htm?postversion=2009042214

http://money.cnn.com/2009/04/21/smallbusiness/kokomo_new_economy/index.htm?postversion=2009042204

http://money.cnn.com/2009/04/21/news/economy/kokomo_auto_economy/index.htm?postversion=2009042204