RURAL COMMUNITY RESPONSE TO CLOSURE/DOWNSIZING OF A MAJOR EMPLOYER

F. Leistritz and Kenneth A. Root

No 23383, Agricultural Economics Reports from North Dakota State University, Department of Agribusiness and Applied Economics

Abstract: Rural communities in the Upper Midwest continue to experience economic restructuring, caused not only by area agricultural changes, but also by mining and local manufacturing shutdowns. Focusing on two states, Minnesota and North Dakota, this study details the repercussions, and response, of five rural communities to the downsizing or closure of a major employer. The five community case studies represent a range of industries in which there were employment losses, diversity in community size, proximity to other labor markets, as well as multiple and varied use of adjustment techniques local leaders used in their response to community job loss. The communities studied were selected from more than 40 communities in the two states that had experienced a closure or downsizing that produced significant job loss between July of 1994 and January of 1998. The five communities were treated as case studies, and a number of local leaders were identified, and participated in in-depth interviews. Additional information about each community was obtained through a random sample of respondents who completed a mailed questionnaire. The questionnaire focused on the respondent's views of the impact of job loss for the community, and their perceptions of leadership to resolve the crisis. The communities ranged in size from less than 400 to 10,000 residents. All five communities had low levels of unemployment, and at the time of the survey data analysis, Minnesota and North Dakota were ranked as having the lowest unemployment rates in the country. Case study communities in this study tended to make a "better" adjustment when there was/were: an economic development organization (regional, if not local) in place prior to the closure; cohesion of community and agency leaders who were not concerned with "turf" issues; a focus on both assisting displaced workers and promoting economic development; a breadth of contact and networking with State agencies, consultants, and community leaders from other communities which had already weathered a dislocation and made a good adjustment; substantial lead time prior to closure/downsizing; an understanding that the adjustment period from downturn to upturn was not overnight, but might take months, or even years, but a "Can Do" attitude prevailed throughout; a closure/downsizing that was not the sole or dominant employer; some displaced workers who were not local residents, but were commuters; and a range of alternative re-use options for the closed facility, rather than a single restrictive use-option.

Keywords: Community/Rural/Urban Development; Labor and Human Capital (search for similar items in EconPapers)
Pages: 80
Date: 1999
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Rural Community Response to Closure or Downsizing of a Major Employer (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:nddaer:23383

DOI: 10.22004/ag.econ.23383

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