WILMINGTON, Ohio (Reuters) – Unemployment in this small U.S. town has quadrupled in the past 16 months, but worse is to come as thousands of unemployed workers run out of severance money and benefits.
"Things are going to get tighter around here toward the end of the year," said David Raizk, mayor of this town of 12,000 in southwestern Ohio. "As benefits run out we're going to see a greater and greater dependence on the aid that's available."
In May 2008, before German shipping firm DHL Express, a unit of German post office operator Deutsche Post, said it was in talks to have rival UPS handle its U.S. operations, unemployment in Wilmington had long been below 3 percent.
But the local unemployment rate jumped over 14 percent in the wake of DHL's announcement last November that it would leave the U.S. domestic market altogether with the loss of 9,500 jobs, many of them in Wilmington.
The national unemployment rate was 9.4 percent in July, while Ohio's jobless rate was 11.2 percent.
Officials in Wilmington are struggling to help the unemployed cope while remaining hopeful that the town will find a way to replace the thousands of mostly unskilled jobs that have been lost, mostly as a result of DHL's pullout.
"We have an opportunity to sell ourselves as a trained workforce," said Katy Farber, president of the Chamber of Commerce in neighboring Highland County. "Out of the ashes of all of this, we could see meaningful change."
DHL bought Airborne Express, the No. 3 U.S. express delivery firm, in 2003 and pledged to create jobs and growth as it aimed to battle dominant U.S. shippers UPS and FedEx Corp on their home turf.
"When DHL came here we felt like we had the world by the horns," said Mark Daley, 50, a pilot furloughed in July by ABX Air, which handles some international flights for DHL. "We had a new owner with deep pockets who knew what they were doing."
Now, Daley may lose his home.
"The irony is UPS and FedEx spent 25 years trying to destroy Airborne," Daley said. "DHL spent billions of dollars trying to grow the business and destroyed it in five."
LOOKING TO THE FUTURE
A number of stores on Wilmington's main street are now shuttered. The Sugar Tree Ministry, which provides free meals for the needy, used to feed perhaps 50 people a week but now the average is up to 250 a day, says Allen Willoughby, the Christian ministry's director.
"We see new faces every day and about 90 percent of them from DHL," he said. "The community has really rallied round."
About 20 miles away in Hillsboro, Mark Crowe of investment firm Crowe Financial Group, said many former DHL workers have sought help after depleting their savings.
"What we're doing now are not financial security plans, they're financial survival plans," he said.
Highland County has been hit by DHL's departure as well as by layoffs at automotive suppliers Weastec and Johnson Controls. Unemployment in the county reached 16.5 percent in July.
Like much of the Midwest, the area relied heavily on manufacturing and a relatively unskilled workforce. Retraining funds are available, but reaching people can be difficult.
"We don't have much local media beyond papers," Farber said. "Many people don't know what their options are."
Some 1,200 former DHL workers have begun retraining.
Moira McKamey, 52, who was laid off last November, has recently completed retraining to be a medical assistant.
"I'll be lucky if I make half of what I did before," she said. "But I'm a hard worker, so I can work my way up again."
Wilmington is also looking forward. The town is in talks to take over DHL's air facility and its two runways to lure new businesses. Neither the company nor town officials were willing to comment on those talks.
"We have to prepare for the future," . "But it may take a while to find new investors while we're in an economy that doesn't seem to know where it's going."
Saturday, September 19, 2009
Ohio town struggles after package giant DHL leaves
In the September 18, 2009 article "Ohio town struggles after package giant DHL leaves," Nick Carey reports: