15 ms·

In Towns Already Hit by Factory Closings, a New Casualty: Retail Jobs

131 points by ctoth 9y ago

ctoth 9y ago
This is related to https://mobile.nytimes.com/2017/04/15/business/retail-industry.html https://mobile.nytimes.com/2017/04/15/business/retail-indust... which I posted a few weeks ago but got no traction. This is a critical part of the story that people talking about robots taking our jobs are missing. It's already happening, it's not just robots but also new scheduling algorithms and frankly people just not giving two shits about retail workers.
- themodelplumber 9y ago
  Education is going to be absolutely crucial for those who are currently performing retail work. I recently attended training by my church on this topic and one of the key focii at present is helping people get the education they need in order to become self-reliant, in any way that works for them. This has never been emphasized to this degree in the past, and the initiatives have enlarged scope from developing nations only to now include the US and Canada. Bachelor's degrees in e.g. web development from an accredited private religious university are offered for around $8K; courses in starting businesses and improving job prospects are offered on demand, etc. It is clear that there is a lot of need right now and the impact of the changing flow of business is being felt heavily.
  - grogenaut 9y ago
    What uni gives a batcuelors for $8k? Even though I'm not religious I'd send my kid there for that savings.
  - vkou 9y ago
    This is great advice for particular people, but does not scale to the entire economy.
  - nickthemagicman 9y ago
    One of Bernie Sanders major platforms was tuition free education. Politicians can talk about 'jobs' all they want, but the real key is education. Because jobs of the future will ALL require some highly technical skill.
    - user5994461 9y ago
      Free education: People get a longer education => Jobs get more selective about education and require longer studies => People have to get a longer education to get a job => Jobs get even more selective => etc... Cheaper education will create more educated people, unfortunately that doesn't create new job prospects.
      - eveningcoffee 9y ago
        Free education does not mean that you get paid while studding. You still have to find means to clothe and feed yourself and find a roof above your head during the nights.
      - nickthemagicman 9y ago
        Well that's the way the knowledge economy works! It's based on your knowledge. So obvs people with more knowledge have better opportunities. It's how it works today except lots of people are left out. The difference is, with everyone educated, now you have a highly knowledgeable populace who are capable of solving harder problems, starting business to solve these problems, etc. I would rather have 1000 people working on Cancer research than at the DMV pushing paper or laying brick. Things machines can do. We would have a net improvement in people's lives and the human race. It's like a win win for everyone.
    - vkou 9y ago
      Either that, or they will consist of housekeeping and gardening for the 1%.
    - eigenman 9y ago
      Although tuition free education is a good answer, it won't work for everyone. There is a distribution of intelligence and skill; not everyone will be able to perform the remaining highly technical jobs. What should our society do with these people? Leave them on the streets? Provide welfare/basic income? This is a critical question because more education will not scale to 100% of the population.
  - mistermann 9y ago
    Training in what though, everyone can't be a web developer? If everything is manufactured overseas or by robots, retail is largely locked up the a handful of giant corporations who can bankrupt competitors, in many places the former middle class spends all their disposable income on housing and can't afford new services, and the 1% largely don't spend their money. And on top of it, the utopia promised by diversity is actual splitting societies, right when we most need cooperation and unity. To me this is start to look like an near unsolvable problem.
    - Moshe_Silnorin 9y ago
      A nice old-fashioned world war should solve it.
      - mistermann 9y ago
        If we keep pretending there's no problem, or hope these problem are going to solve themselves, we're going to end up with civil wars, at least.
        godzillabrennus 9y ago
        America is already engaged in a "cold" civil war between the cities and the rural communities. The cultural and economic future of the nation is being legislated by the current victor. It will be interesting to see how this plays out.
        qubex 9y ago
        ”Cold Civil War” is the best term to describe and surmise the current predicament I've read so far in years of considering these problems. Is it your phrase?
        louprado 9y ago
        First use I could find is by John Derbyshire June 27, 2013 [1]. This is a powerful phrase that hopefully finds common usage. Perhaps we'd all have less contempt towards opposing views if we are reminded that violence occurs when contempt levels get too high. [1] http://takimag.com/article/the_cold_civil_war_grinds_on_john_derbyshire/print#ixzz4l2lQBlcE http://takimag.com/article/the_cold_civil_war_grinds_on_john...
  - Animats 9y ago
    Education is going to be absolutely crucial for those who are currently performing retail work. It won't help. About half of new college graduates are doing jobs that don't require a college education. Those are the ones heavily in debt, with a negative return on investment for college.
    - nine_k 9y ago
      Does this apply equally to STEM / medical / finance degrees, and e.g medieval history or social studies degrees?
      - emodendroket 9y ago
        Only a handful of STEM degrees are really remunerative, and I don't think we can call putting everyone in a handful of engineering disciplines a serious solution.
  - stupidcar 9y ago
    What kind of "web development" degrees are we talking about here? Because I see a lot of private universities and colleges taking ever penny from desperate people in exchange for teaching pretty basic IT skills. They're sold on the idea that if they know a bit about HTML and CSS it'll be a ticket into a well paid tech job, despite the fact that what they're learning wouldn't have got them through the door at an agency ten years ago, let alone today.
    - themodelplumber 9y ago
      It's one of many degrees offered but the one you're asking about is the bachelor's degree in web design and development, listed here: http://www.byui.edu/online/degrees-and-programs http://www.byui.edu/online/degrees-and-programs Reviewing the degree requirements and courses, and having studied CS at BYU myself, I'm betting the quality is very high. In fact I wish, as a web developer currently, that I could have taken some of these courses instead of courses like advanced algorithms; though fascinating, I'll bet I would have enjoyed a basic security course or a vector graphics course much more.
  - emodendroket 9y ago
    I've never heard of a job retraining program that did better than like 20% of the people going through it finding jobs that paid similarly to their old ones. Have you?
deleted 9y ago
[deleted]
ctoth 9y ago
One more piece if anybody stumbles across this: https://morecrows.wordpress.com/2016/05/10/unnecessariat/ https://morecrows.wordpress.com/2016/05/10/unnecessariat/
Theodores 9y ago
The article blames ecommerce and Amazon for the latest decline. I don't live there, however, I believe this is not to do with ecommerce, it is simply the loss of manufacturing and what happens over time. In the UK we had many communities thrown on the scrapheap with mines, steel and much else manufacturing gone. Initially people invest their redundancy money in things such as a new dog-grooming business, a cafe, a shop, perhaps a tattoo parlour, depending on what 'follow your passion' leads to. So these businesses go okay for a while, eventually the redundancy money runs out, or, in rare instances, the 'follow the passion' business actually meets a genuine need and a success story happens. Around the time of this general decline my sister was trying to raise money to go somewhere fancy with her group of friends. Being skint she decided to raise some money by making things - things with beads, jewellery, that sort of stuff. These items sold 'well' but only to her friends whom she was going to be travelling with. There was no 'external market'. So rather than go on the big trip to the festival they missed out on that and spent what little money they had on beads etc. to make stuff to sell to each other. A lesson in economics was learned the hard way. To some extent any town/city/country that does not have manufacturing and external markets will be a variant of my sister's schooldays model of capitalism. If manufacturing (or mining) jobs go and retail comes along to 'fill the gap', then it cannot last forever. Tourism can't come to the rescue either.
- vkou 9y ago
  > Tourism can't come to the rescue either. It can, but unless your location is amazing, compared to the number of people that it must sustain (Hawaii, Whistler), it won't.
  - fuzzfactor 9y ago
    Tourism can create local prosperity in the form of a pure consumer economy in places where there never has even been a local source of actual wealth creation. But tourism dollars only signify wealth that was created elsewhere and merely used for consumption at the resort.
- fuzzfactor 9y ago
  So-called rust belt towns like this earned their name back when steel mills first began migrating from Pennsylvania to locations having lower labor costs decades ago. It was not so much in search of the cheapest labor, rather avoidance of the most expensive labor which was in this part of the US at the time. Almost anywhere else could provide a significant cost advantage in an increasingly competitive market. OTOH, during the decades when the high wages were prevailing in the area, this was a unique opportunity to build a certain amount of local wealth while it lasted. It is not from some form of strength that "retail jobs came to predominate", instead retail was all that remained after the actual wealth-creating engine had left the area. All retail could do was extract the remaing local wealth which had been generated during the times of better-paying employment with actual wealth-generating industries. Now that this remaining wealth is dwindling too, these jobs are becoming more unnecessary as the long tail of the middle class continues to be absorbed, their resources from above and their numbers from below. You can't have a consumer economy without an equal or greater amount of surplus wealth in the hands of consumers, even then it is completely unsustainable unless there is an ongoing source of new value being created for consumers in excess of value being permanently consumed by both producers & consumers combined. If producers are not a bigger part of the equation than consumers, you can not balance the equation.
ChuckMcM 9y ago
As the article points out the retail job crush is exactly because the Factorys closed, nothing more magical than there is less GDP so there is less work. Previously those factory workers bought things at the store, but now that the factory is closed they can't (or they cut back) and the stores don't have some magical source of 'outside of market' money. They call this out in a couple of places but they never seem to completely connect the dots, there is "He renovated the first floor to attract customers from farther away, customers who might have more money to spend and more places to go than Johnstown." to pull money from towns further away, or "But fewer people can afford his products now that the good jobs are long gone, and Mr. Apryle has had to make adjustments." It's not Amazon, its not 'big box' chains, its that the city no longer has a production base and so the fraction of GDP this space used to produce has gone away.
- qubex 9y ago
  This is exactly what I thought too: a drop in local GDP has caused a drop in aggregate demand for consumer goods and services. The only proviso is that some of the remains demand is served by out-of-county suppliers, including e-commerce operations that obviously have the advantage of convenience for the local consumers on account of their logistics.
- thirdsun 9y ago
  > It's not Amazon, its not 'big box' chains, its that the city no longer has a production base and so the fraction of GDP this space used to produce has gone away. I disagree. In my opinion this development is very much related to Amazon and e-commerce in general. I'm living in a rural region that saw a lot of retail disappearing, yet I really don't see people cutting back or buying less. They just buy elsewhere. And who could blame them? Researching products online provides way more information than your small store around the corner could offer. Selection is vastly superior on the internet - not just on Amazon and big brand stores, but countless of stores catering to niche interests. Those have never been around here. However even general goods like clothing, mainstream tech, etc. - very often I know what I want and find myself just as certain that it's not available locally. Just the other day I needed a new vacuum and decided to get a specific Miele model. Before ordering I wanted to see if I could get it immediately in a 30 minute drive radius and contacted several stores that were featured on Miele's list of retailers. Poor websites all over the place. So I sent an e-mail to all of them, asking if could come by later and pick up the specific model if it's available. No store replied within the day, none of the stores had the model which I was looking for, which wasn't very niche either. Didn't matter - later that day I ordered from Amazon and had it delivered the next day via Prime. I'm sorry, but when it comes to information, selection, availability and convenience there's simply no local competition for e-commerce.
fiatjaf 9y ago
This proves liberalism is wrong!
- nappy 9y ago
  huh?
mc32 9y ago
It's a big economy and changes take too long trickling down to those forgotten rural towns once part of the American economic engine. I'm pessimistic that the federal or even state governments have the will to do anything about it -in terms of policy to effect change. Not that top down change always works (Japan for example, has made many, many half-hearted but ill-conceived attempts at restarting their growth engine) but smaller nimbler economies have been able to manoeuver economic obstacles (like Taiwan, Singapore and S. Korea) whereas others have stumbled and fumbled (Malaysia, Mexico). That said, we need to try something. Trump tapped into this angst but does not look like he (or the party) will deliver in the least. Never the less, the issue is not going away and will only become more pronounced. Someone will have to do _something_ about it. People will get upset and more radical elements will be elected till someone begins to take notice and does something substantial about the economic decline of the part of the middle class which got by on medium skills.
- princeb 9y ago
  Do the changes need to trickle down to the dying towns? They are forgotten because they no longer have much value to people outside the towns. The town itself exists as a conduit through which people channel their energies together to bring value into their lives. If the conduit collapses, if the factories and the mills go, how can the people survive? The raison d'être of the communities has long passed away, but the community itself hasn't. Put them out of their misery, please! It is only by some miracle that these towns begin to bring value to the economy again (and not simply by the unsustainable method of spending and consuming), but until that happens they will continue to rot. Their minds can exist in the global hive-mind that is the internet, but their physical bodies need physical maintenance. And yet they exist too far away and too isolated to make it economically viable to do so. The major cities appear to have monopolized the exercise of human labour for value. Whereas early homo sapiens have loosely organized communities that work to maintain a loosely comfortable life, modern cities have concentrated human effort like a parabolic reflector in order to generate luxuries beyond the reach of mere casual cooperation. These small towns, without the buttress of a major industrial mill or any economic output at all, captures none of the benefits of living in a modern world. The consolation to the community that hopes to see the itself continue is that these towns are surprisingly hardy, producing generation after generation of brain-addled drug addicts. My sympathies are not with them.
oneplane 9y ago
This job-centric lifestyle seems to point to a problem of sustainability rather than economics. Jobs are never endless, moving somewhere or creating a town for one particular job or factory will always end in deserted towns and closed factories, and not adapting to what is happening around you always ends in tears. Nothing new here... If you want to work, you should look for what people need rather than whatever you did for a job 20 years ago. For example, we'll always need energy and food, but we won't always need cowboys and coal miners. Instead of trying to be a coal miner, try to be an energy worker.
- protomyth 9y ago
  > For example, we'll always need energy and food, but we won't always need cowboys and coal miners. Cowboys are part of the food sector. Ranching to be specific. Herding cattle, fixing fences, and doing all the other choirs on a ranch will probably be a while down the automation trail. Making some bad decisions like not moving the cattle from the summer grazing area to the winter grazing area quick enough can cost a lot of money.
  - frutiger 9y ago
    If I understood `oneplane` correctly, that's exactly the point. Coal miners are in the energy sector, and cowboys are in the food sector. Whether or not a specific worker in those industries will be required may change over time, but the general demand for the output of those industries likely will not.
  - Animats 9y ago
    "We don't fix fence, we build fence" - King Ranch slogan. Herding cows with a drone.[1] I ride, and I know people who work cattle from horseback, but the number of people still doing that is small. Drones are becoming incredibly useful in the industries where somebody has to check on things over a large area. From farming to power line inspection, it's become far easier to look at hard-to-reach areas. [1] https://www.youtube.com/watch?v=ni-YxR2j8-g https://www.youtube.com/watch?v=ni-YxR2j8-g
    - 9y ago
withdavidli 9y ago
Worked in a mall for a decade. As money moves out so do retail stores. Small mom and pop shops barely sustain because of little to no labor cost. Small businesses that do have to hire employees close down fast because labor cost becomes unsustainable due to low margin business. Worse is when big box stores moves out, they tend to be the attraction that drove people to the mall in the first place, and smaller stores got business from being "discovered" along the way in high traffic locations.
- uhhfcuvv 9y ago
  > Worked in a mall for a decade. How does someone like this bump into HN?
  - meddlepal 9y ago
    A lot of us worked retail jobs when we were younger?
  - draw_down 9y ago
    Mall workers are allowed on the internet
    - zeckalpha 9y ago
      For now.
  - withdavidli 9y ago
    That was middle school through college. I'm in non-tech role, but live in the valley at big tech. HN decent place for news about industry and more insightful comments than other news sites.
Mz 9y ago
Sort of a TLDR of the piece: Rural counties and small metropolitan areas account for about 23 percent of traditional American retail employment, but they are home to just 13 percent of e-commerce positions. Almost all customer fulfillment centers run by the online shopping behemoth Amazon are in metropolitan areas with more than 250,000 people — close to the bulk of its customers “I’m thinking about what’s next,” he said. “We’re essentially thinking of Johnstown as an economic development laboratory.”
bluedino 9y ago
Well, if there's a bright side it's that the good retail jobs are long gone. I had friends whose parents made decent livings selling suits or appliances at Sears and JCPenny. You used to make 40k/year as an assistant manager at KMart. Now it's almost impossible to make $10/hr in retail. There are no benefits or even full-time hours. And the only stores hiring work you like a dog with two people per shift like Dollar General. You have to stock, clean up, and play cashier.
deleted 9y ago
[deleted]
notadoc 9y ago
It's fairly obvious that less (or no) disposable income leads to less consumer spending, which leads to fewer jobs, which leads to less consumer spending, which leads to.... That is exactly the ongoing story of the vanishing middle class. The lack of demand snowballs and branches out to impact many other things the exact same way that a strong increase in demand spreads out to impact other things. With a predominantly consumer driven economy, eventually all of this will catch up and be a significant drag on GDP at best, though it'd be easy to argue we're already at exactly that point. So, what happens next and what do we do about it? If only we had some sort of large team of people who were elected to solve this kind of problem, and if only they had some sort of historical periods of widespread prosperity to reference and model policy on....
- knz 9y ago
  > and if only they had some sort of historical periods of widespread prosperity to reference and model policy on.... Isn't the problem that no one can agree what historical prosperity looked like especially when thinking about the consequences of the policies that lead to the prosperity. Was it the 1920's, 1950's, or 1980's? 2000's? Or the age of the Robber Barron's Or some other time? Personally I think a bigger issue is the failure of our elected officials to deal with the things holding prosperity back - housing/healthcare/education/childcare rising more rapidly than people can sustain.
  - Retric 9y ago
    The social unrest of the 60's was a direct results of widespread prosperity. Even a minimum wage job for 6 months was often enough to live on for ~1 year. In part because there where fewer things to buy, but also because expected standards of living where low and the green revolution drastically reduced food prices. The world population was also less than 1/2 what it is today which had other benefits.
  - Gibbon1 9y ago
    > consequences of the policies that lead to the prosperity. I have suspicions that policy changes to allow banks to compete on a national basis didn't do a lot of flyover country any good. Before the loans from the central bank flowed down a tree, each node ending up at some local bank. Which had to loan out money locally. Now it's a couple of large banks chasing best safe returns. And gouging consumers as much as they can.
matt_s 9y ago
I wouldn't consider any retail job (e.g. cashier), a middle class job. Nobody wants to think of themselves as lower class but clearly there is a delineation somewhere? Are you still considered middle class if you are unemployed and the industry you worked in left town? Similar things will happen to small towns along trucking routes if tractor-trailer driving becomes automated. You will have less need for restaurants, small hotels, truck-stops, etc. if an automated truck is passing through at 3am. I don't see solutions to this other than people leaving these towns or learning new skills.
- whatnotests 9y ago
  When I worked retail (1996-2001) as a manager in an outlet mall, I could afford rent and food, but not much else, and this was in Colorado. I can't imagine calling retail "middle class" since it pays so little.

131 points by ctoth 9y ago

This is related to https://mobile.nytimes.com/2017/04/15/business/retail-industry.html https://mobile.nytimes.com/2017/04/15/business/retail-indust... which I posted a few weeks ago but got no traction. This is a critical part of the story that people talking about robots taking our jobs are missing. It's already happening, it's not just robots but also new scheduling algorithms and frankly people just not giving two shits about retail workers.

themodelplumber 9y ago
Education is going to be absolutely crucial for those who are currently performing retail work. I recently attended training by my church on this topic and one of the key focii at present is helping people get the education they need in order to become self-reliant, in any way that works for them. This has never been emphasized to this degree in the past, and the initiatives have enlarged scope from developing nations only to now include the US and Canada. Bachelor's degrees in e.g. web development from an accredited private religious university are offered for around $8K; courses in starting businesses and improving job prospects are offered on demand, etc. It is clear that there is a lot of need right now and the impact of the changing flow of business is being felt heavily.
- grogenaut 9y ago
  What uni gives a batcuelors for $8k? Even though I'm not religious I'd send my kid there for that savings.
- vkou 9y ago
  This is great advice for particular people, but does not scale to the entire economy.
- nickthemagicman 9y ago
  One of Bernie Sanders major platforms was tuition free education. Politicians can talk about 'jobs' all they want, but the real key is education. Because jobs of the future will ALL require some highly technical skill.
  - user5994461 9y ago
    Free education: People get a longer education => Jobs get more selective about education and require longer studies => People have to get a longer education to get a job => Jobs get even more selective => etc... Cheaper education will create more educated people, unfortunately that doesn't create new job prospects.
    - eveningcoffee 9y ago
      Free education does not mean that you get paid while studding. You still have to find means to clothe and feed yourself and find a roof above your head during the nights.
    - nickthemagicman 9y ago
      Well that's the way the knowledge economy works! It's based on your knowledge. So obvs people with more knowledge have better opportunities. It's how it works today except lots of people are left out. The difference is, with everyone educated, now you have a highly knowledgeable populace who are capable of solving harder problems, starting business to solve these problems, etc. I would rather have 1000 people working on Cancer research than at the DMV pushing paper or laying brick. Things machines can do. We would have a net improvement in people's lives and the human race. It's like a win win for everyone.
  - vkou 9y ago
    Either that, or they will consist of housekeeping and gardening for the 1%.
  - eigenman 9y ago
    Although tuition free education is a good answer, it won't work for everyone. There is a distribution of intelligence and skill; not everyone will be able to perform the remaining highly technical jobs. What should our society do with these people? Leave them on the streets? Provide welfare/basic income? This is a critical question because more education will not scale to 100% of the population.
- mistermann 9y ago
  Training in what though, everyone can't be a web developer? If everything is manufactured overseas or by robots, retail is largely locked up the a handful of giant corporations who can bankrupt competitors, in many places the former middle class spends all their disposable income on housing and can't afford new services, and the 1% largely don't spend their money. And on top of it, the utopia promised by diversity is actual splitting societies, right when we most need cooperation and unity. To me this is start to look like an near unsolvable problem.
  - Moshe_Silnorin 9y ago
    A nice old-fashioned world war should solve it.
    - mistermann 9y ago
      If we keep pretending there's no problem, or hope these problem are going to solve themselves, we're going to end up with civil wars, at least.
      - godzillabrennus 9y ago
        America is already engaged in a "cold" civil war between the cities and the rural communities. The cultural and economic future of the nation is being legislated by the current victor. It will be interesting to see how this plays out.
        qubex 9y ago
        ”Cold Civil War” is the best term to describe and surmise the current predicament I've read so far in years of considering these problems. Is it your phrase?
        louprado 9y ago
        First use I could find is by John Derbyshire June 27, 2013 [1]. This is a powerful phrase that hopefully finds common usage. Perhaps we'd all have less contempt towards opposing views if we are reminded that violence occurs when contempt levels get too high. [1] http://takimag.com/article/the_cold_civil_war_grinds_on_john_derbyshire/print#ixzz4l2lQBlcE http://takimag.com/article/the_cold_civil_war_grinds_on_john...
- Animats 9y ago
  Education is going to be absolutely crucial for those who are currently performing retail work. It won't help. About half of new college graduates are doing jobs that don't require a college education. Those are the ones heavily in debt, with a negative return on investment for college.
  - nine_k 9y ago
    Does this apply equally to STEM / medical / finance degrees, and e.g medieval history or social studies degrees?
    - emodendroket 9y ago
      Only a handful of STEM degrees are really remunerative, and I don't think we can call putting everyone in a handful of engineering disciplines a serious solution.
- stupidcar 9y ago
  What kind of "web development" degrees are we talking about here? Because I see a lot of private universities and colleges taking ever penny from desperate people in exchange for teaching pretty basic IT skills. They're sold on the idea that if they know a bit about HTML and CSS it'll be a ticket into a well paid tech job, despite the fact that what they're learning wouldn't have got them through the door at an agency ten years ago, let alone today.
  - themodelplumber 9y ago
    It's one of many degrees offered but the one you're asking about is the bachelor's degree in web design and development, listed here: http://www.byui.edu/online/degrees-and-programs http://www.byui.edu/online/degrees-and-programs Reviewing the degree requirements and courses, and having studied CS at BYU myself, I'm betting the quality is very high. In fact I wish, as a web developer currently, that I could have taken some of these courses instead of courses like advanced algorithms; though fascinating, I'll bet I would have enjoyed a basic security course or a vector graphics course much more.
- emodendroket 9y ago
  I've never heard of a job retraining program that did better than like 20% of the people going through it finding jobs that paid similarly to their old ones. Have you?

deleted 9y ago

[deleted]

ctoth 9y ago

One more piece if anybody stumbles across this: https://morecrows.wordpress.com/2016/05/10/unnecessariat/ https://morecrows.wordpress.com/2016/05/10/unnecessariat/

Theodores 9y ago

The article blames ecommerce and Amazon for the latest decline. I don't live there, however, I believe this is not to do with ecommerce, it is simply the loss of manufacturing and what happens over time. In the UK we had many communities thrown on the scrapheap with mines, steel and much else manufacturing gone. Initially people invest their redundancy money in things such as a new dog-grooming business, a cafe, a shop, perhaps a tattoo parlour, depending on what 'follow your passion' leads to. So these businesses go okay for a while, eventually the redundancy money runs out, or, in rare instances, the 'follow the passion' business actually meets a genuine need and a success story happens. Around the time of this general decline my sister was trying to raise money to go somewhere fancy with her group of friends. Being skint she decided to raise some money by making things - things with beads, jewellery, that sort of stuff. These items sold 'well' but only to her friends whom she was going to be travelling with. There was no 'external market'. So rather than go on the big trip to the festival they missed out on that and spent what little money they had on beads etc. to make stuff to sell to each other. A lesson in economics was learned the hard way. To some extent any town/city/country that does not have manufacturing and external markets will be a variant of my sister's schooldays model of capitalism. If manufacturing (or mining) jobs go and retail comes along to 'fill the gap', then it cannot last forever. Tourism can't come to the rescue either.

vkou 9y ago
> Tourism can't come to the rescue either. It can, but unless your location is amazing, compared to the number of people that it must sustain (Hawaii, Whistler), it won't.
- fuzzfactor 9y ago
  Tourism can create local prosperity in the form of a pure consumer economy in places where there never has even been a local source of actual wealth creation. But tourism dollars only signify wealth that was created elsewhere and merely used for consumption at the resort.
fuzzfactor 9y ago
So-called rust belt towns like this earned their name back when steel mills first began migrating from Pennsylvania to locations having lower labor costs decades ago. It was not so much in search of the cheapest labor, rather avoidance of the most expensive labor which was in this part of the US at the time. Almost anywhere else could provide a significant cost advantage in an increasingly competitive market. OTOH, during the decades when the high wages were prevailing in the area, this was a unique opportunity to build a certain amount of local wealth while it lasted. It is not from some form of strength that "retail jobs came to predominate", instead retail was all that remained after the actual wealth-creating engine had left the area. All retail could do was extract the remaing local wealth which had been generated during the times of better-paying employment with actual wealth-generating industries. Now that this remaining wealth is dwindling too, these jobs are becoming more unnecessary as the long tail of the middle class continues to be absorbed, their resources from above and their numbers from below. You can't have a consumer economy without an equal or greater amount of surplus wealth in the hands of consumers, even then it is completely unsustainable unless there is an ongoing source of new value being created for consumers in excess of value being permanently consumed by both producers & consumers combined. If producers are not a bigger part of the equation than consumers, you can not balance the equation.

ChuckMcM 9y ago

As the article points out the retail job crush is exactly because the Factorys closed, nothing more magical than there is less GDP so there is less work. Previously those factory workers bought things at the store, but now that the factory is closed they can't (or they cut back) and the stores don't have some magical source of 'outside of market' money. They call this out in a couple of places but they never seem to completely connect the dots, there is "He renovated the first floor to attract customers from farther away, customers who might have more money to spend and more places to go than Johnstown." to pull money from towns further away, or "But fewer people can afford his products now that the good jobs are long gone, and Mr. Apryle has had to make adjustments." It's not Amazon, its not 'big box' chains, its that the city no longer has a production base and so the fraction of GDP this space used to produce has gone away.

qubex 9y ago
This is exactly what I thought too: a drop in local GDP has caused a drop in aggregate demand for consumer goods and services. The only proviso is that some of the remains demand is served by out-of-county suppliers, including e-commerce operations that obviously have the advantage of convenience for the local consumers on account of their logistics.
thirdsun 9y ago
> It's not Amazon, its not 'big box' chains, its that the city no longer has a production base and so the fraction of GDP this space used to produce has gone away. I disagree. In my opinion this development is very much related to Amazon and e-commerce in general. I'm living in a rural region that saw a lot of retail disappearing, yet I really don't see people cutting back or buying less. They just buy elsewhere. And who could blame them? Researching products online provides way more information than your small store around the corner could offer. Selection is vastly superior on the internet - not just on Amazon and big brand stores, but countless of stores catering to niche interests. Those have never been around here. However even general goods like clothing, mainstream tech, etc. - very often I know what I want and find myself just as certain that it's not available locally. Just the other day I needed a new vacuum and decided to get a specific Miele model. Before ordering I wanted to see if I could get it immediately in a 30 minute drive radius and contacted several stores that were featured on Miele's list of retailers. Poor websites all over the place. So I sent an e-mail to all of them, asking if could come by later and pick up the specific model if it's available. No store replied within the day, none of the stores had the model which I was looking for, which wasn't very niche either. Didn't matter - later that day I ordered from Amazon and had it delivered the next day via Prime. I'm sorry, but when it comes to information, selection, availability and convenience there's simply no local competition for e-commerce.

fiatjaf 9y ago

This proves liberalism is wrong!

nappy 9y ago
huh?

mc32 9y ago

It's a big economy and changes take too long trickling down to those forgotten rural towns once part of the American economic engine. I'm pessimistic that the federal or even state governments have the will to do anything about it -in terms of policy to effect change. Not that top down change always works (Japan for example, has made many, many half-hearted but ill-conceived attempts at restarting their growth engine) but smaller nimbler economies have been able to manoeuver economic obstacles (like Taiwan, Singapore and S. Korea) whereas others have stumbled and fumbled (Malaysia, Mexico). That said, we need to try something. Trump tapped into this angst but does not look like he (or the party) will deliver in the least. Never the less, the issue is not going away and will only become more pronounced. Someone will have to do _something_ about it. People will get upset and more radical elements will be elected till someone begins to take notice and does something substantial about the economic decline of the part of the middle class which got by on medium skills.

princeb 9y ago
Do the changes need to trickle down to the dying towns? They are forgotten because they no longer have much value to people outside the towns. The town itself exists as a conduit through which people channel their energies together to bring value into their lives. If the conduit collapses, if the factories and the mills go, how can the people survive? The raison d'être of the communities has long passed away, but the community itself hasn't. Put them out of their misery, please! It is only by some miracle that these towns begin to bring value to the economy again (and not simply by the unsustainable method of spending and consuming), but until that happens they will continue to rot. Their minds can exist in the global hive-mind that is the internet, but their physical bodies need physical maintenance. And yet they exist too far away and too isolated to make it economically viable to do so. The major cities appear to have monopolized the exercise of human labour for value. Whereas early homo sapiens have loosely organized communities that work to maintain a loosely comfortable life, modern cities have concentrated human effort like a parabolic reflector in order to generate luxuries beyond the reach of mere casual cooperation. These small towns, without the buttress of a major industrial mill or any economic output at all, captures none of the benefits of living in a modern world. The consolation to the community that hopes to see the itself continue is that these towns are surprisingly hardy, producing generation after generation of brain-addled drug addicts. My sympathies are not with them.

oneplane 9y ago

This job-centric lifestyle seems to point to a problem of sustainability rather than economics. Jobs are never endless, moving somewhere or creating a town for one particular job or factory will always end in deserted towns and closed factories, and not adapting to what is happening around you always ends in tears. Nothing new here... If you want to work, you should look for what people need rather than whatever you did for a job 20 years ago. For example, we'll always need energy and food, but we won't always need cowboys and coal miners. Instead of trying to be a coal miner, try to be an energy worker.

protomyth 9y ago
> For example, we'll always need energy and food, but we won't always need cowboys and coal miners. Cowboys are part of the food sector. Ranching to be specific. Herding cattle, fixing fences, and doing all the other choirs on a ranch will probably be a while down the automation trail. Making some bad decisions like not moving the cattle from the summer grazing area to the winter grazing area quick enough can cost a lot of money.
- frutiger 9y ago
  If I understood `oneplane` correctly, that's exactly the point. Coal miners are in the energy sector, and cowboys are in the food sector. Whether or not a specific worker in those industries will be required may change over time, but the general demand for the output of those industries likely will not.
- Animats 9y ago
  "We don't fix fence, we build fence" - King Ranch slogan. Herding cows with a drone.[1] I ride, and I know people who work cattle from horseback, but the number of people still doing that is small. Drones are becoming incredibly useful in the industries where somebody has to check on things over a large area. From farming to power line inspection, it's become far easier to look at hard-to-reach areas. [1] https://www.youtube.com/watch?v=ni-YxR2j8-g https://www.youtube.com/watch?v=ni-YxR2j8-g
  - 9y ago

withdavidli 9y ago

Worked in a mall for a decade. As money moves out so do retail stores. Small mom and pop shops barely sustain because of little to no labor cost. Small businesses that do have to hire employees close down fast because labor cost becomes unsustainable due to low margin business. Worse is when big box stores moves out, they tend to be the attraction that drove people to the mall in the first place, and smaller stores got business from being "discovered" along the way in high traffic locations.

uhhfcuvv 9y ago
> Worked in a mall for a decade. How does someone like this bump into HN?
- meddlepal 9y ago
  A lot of us worked retail jobs when we were younger?
- draw_down 9y ago
  Mall workers are allowed on the internet
  - zeckalpha 9y ago
    For now.
- withdavidli 9y ago
  That was middle school through college. I'm in non-tech role, but live in the valley at big tech. HN decent place for news about industry and more insightful comments than other news sites.

Mz 9y ago

Sort of a TLDR of the piece: Rural counties and small metropolitan areas account for about 23 percent of traditional American retail employment, but they are home to just 13 percent of e-commerce positions. Almost all customer fulfillment centers run by the online shopping behemoth Amazon are in metropolitan areas with more than 250,000 people — close to the bulk of its customers “I’m thinking about what’s next,” he said. “We’re essentially thinking of Johnstown as an economic development laboratory.”

bluedino 9y ago

Well, if there's a bright side it's that the good retail jobs are long gone. I had friends whose parents made decent livings selling suits or appliances at Sears and JCPenny. You used to make 40k/year as an assistant manager at KMart. Now it's almost impossible to make $10/hr in retail. There are no benefits or even full-time hours. And the only stores hiring work you like a dog with two people per shift like Dollar General. You have to stock, clean up, and play cashier.

deleted 9y ago

[deleted]

notadoc 9y ago

It's fairly obvious that less (or no) disposable income leads to less consumer spending, which leads to fewer jobs, which leads to less consumer spending, which leads to.... That is exactly the ongoing story of the vanishing middle class. The lack of demand snowballs and branches out to impact many other things the exact same way that a strong increase in demand spreads out to impact other things. With a predominantly consumer driven economy, eventually all of this will catch up and be a significant drag on GDP at best, though it'd be easy to argue we're already at exactly that point. So, what happens next and what do we do about it? If only we had some sort of large team of people who were elected to solve this kind of problem, and if only they had some sort of historical periods of widespread prosperity to reference and model policy on....

knz 9y ago
> and if only they had some sort of historical periods of widespread prosperity to reference and model policy on.... Isn't the problem that no one can agree what historical prosperity looked like especially when thinking about the consequences of the policies that lead to the prosperity. Was it the 1920's, 1950's, or 1980's? 2000's? Or the age of the Robber Barron's Or some other time? Personally I think a bigger issue is the failure of our elected officials to deal with the things holding prosperity back - housing/healthcare/education/childcare rising more rapidly than people can sustain.
- Retric 9y ago
  The social unrest of the 60's was a direct results of widespread prosperity. Even a minimum wage job for 6 months was often enough to live on for ~1 year. In part because there where fewer things to buy, but also because expected standards of living where low and the green revolution drastically reduced food prices. The world population was also less than 1/2 what it is today which had other benefits.
- Gibbon1 9y ago
  > consequences of the policies that lead to the prosperity. I have suspicions that policy changes to allow banks to compete on a national basis didn't do a lot of flyover country any good. Before the loans from the central bank flowed down a tree, each node ending up at some local bank. Which had to loan out money locally. Now it's a couple of large banks chasing best safe returns. And gouging consumers as much as they can.

matt_s 9y ago

I wouldn't consider any retail job (e.g. cashier), a middle class job. Nobody wants to think of themselves as lower class but clearly there is a delineation somewhere? Are you still considered middle class if you are unemployed and the industry you worked in left town? Similar things will happen to small towns along trucking routes if tractor-trailer driving becomes automated. You will have less need for restaurants, small hotels, truck-stops, etc. if an automated truck is passing through at 3am. I don't see solutions to this other than people leaving these towns or learning new skills.

whatnotests 9y ago
When I worked retail (1996-2001) as a manager in an outlet mall, I could afford rent and food, but not much else, and this was in Colorado. I can't imagine calling retail "middle class" since it pays so little.