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The American middle class is in distress. Here's what that means to the world's largest economy, and the rest of planet earth.

United States

America the Gutted: North Carolina, America's most gutted state

The Tar Heel State has been the hardest hit by factory outsourcing

data compiled from the Labor Department by the nonprofit Public Citizen.

“It’s partly because of what North Carolina makes or used to make — the sorts of light manufacturers, the non-durable manufacturers that you get with textiles and apparel,” Conway said. “Those sorts of things were easier to outsource and therefore they left the quickest.”

VF Corp, Wrangler jeans’ parent company, largely began moving production overseas in the 1990s. The Windsor plant may have held out longer than many because it consistently received awards for being the most efficient producer of Wrangler jeans, said the plant’s former manager, Bob Brown. But even then, he said, once trade restrictions were removed his workers simply couldn’t compete with low wage countries.

If a salesman went to Wal-Mart with a pair of jeans selling for, say, $9 wholesale, the buyer would “lay a pair of jeans right up beside them that look just like them and say, we can buy these for $6,” Brown explained. “They force the companies to have to go offshore.”

And the town of Windsor and surrounding Bertie County never really recovered, said Brown, who now serves as town commissioner. Businesses that relied on the money spent by the plants’ 360 employees shut down. Factories that supplied zippers, boxes and other products to Wrangler also closed.

“Just closing one plant down, it affects a lot of people,” Brown said. “You bring in a new plant here, you’ll see some more businesses springing up to service it. But it’s not happening now. It’s not going to happen.”

And that’s left those who live here without many options. Nearly a quarter of the county lives below the federal poverty line. Unemployment in August reached 12.6 percent, better than in the depth of the recession, but well above the nationwide rate of 8.1 percent. Median household income in Bertie County in 2010 was just $29,110, a third lower than in North Carolina and just over half that in the US as a whole.

What happens in this troubled county matters not only because North Carolina is a key swing state in the US presidential election, carried by Obama in 2008 but too close to call in recent polls. It’s also important because the region offers a window into the future for other areas decimated by the outsourcing of manufacturing.

“You can have regions which lag and are subject to population declines and poverty for decades at a time, even if they’re freely and tightly integrated into a wider free market economy,” said Roland Stephen, senior economist with the research foundation SRI International.

“You see that in north of England. You see that in some parts of East Germany,” he added. “And I think you’re going to see that more and more in the US — that there are going to be some regions that aren’t really viable at any scale.”

Stephen recently wrote a paper about lessons to be learned from North Carolina’s efforts to recover from its loss of manufacturing jobs.

“It’s not a universally bad picture,” he said. Parts of the state have managed to thrive. The research triangle near Raleigh, surrounded by several public and private universities, has attracted a vibrant biomedical industry.

And he points to Asheville, a resort and retirement Mecca in the Appalachian Mountains on the Western edge of the state, as a potential model for a new economy of “busboys and poets.” Even if wages have dropped, in some areas at least, new jobs are relatively plentiful.

Yet jobs in the service economy seem out of reach for places like Bertie County, especially for the aging generation of workers laid off from the once-dominant textile, furniture and tobacco industries. Just ten percent of those over age 25 finished college.

“When they were growing up, you didn’t need anything more,” Stephen said. “You could have a good life, you could have a house, a boat on the lake, and it seemed like that would go on forever.”

After Bell was laid off from the Wrangler factory, she defied the odds by re-training to work in a more promising industry. But for a woman in her 50s with few other prospects, even this course has proven rocky.

After receiving her license as a nursing assistant, Bell found a job caring for an elderly woman for six hours a day. At $8.50 an hour, it was the best job she’s had since Wrangler.

When that woman passed away, Bell couldn’t find a patient to replace her. After a year on unemployment, she found work this summer cleaning beach side rental homes. Most weekend days, she leaves home at 5:15 am, drives two hours to the shore, cleans all day, and finally returns home at 10pm.

She said she earns an average of $250 a week, which goes towards her house payment and her adopted sons’ college expenses. It barely covers essential costs. She said she’s been unable to pay off hundreds of thousands of dollars in medical expenses incurred half a decade ago. A couple years after losing her job at Wrangler, she came down with diverticulitis and needed 15 days in the hospital, but didn’t have insurance to cover the bill.

Bell, a proud woman who once had little trouble feeding her family, now finds herself pinched at the grocery store.

“You can’t just go pick up a pack of pork chops or a pack of chicken,” Bell said. “You have to see how much it cost first.”

The cleaning work is seasonal, so she’s worried about her options once the weather cools and the rental homes close for the year. Perhaps the toughest challenge, she said, is the growing suspicion that, no matter how hard she works, things are unlikely to improve.

“Wrangler kept us motivated. It kept us going,” Bell said. “We had something to look forward to. Whereas now that Wrangler is gone, there ain’t nothing to look forward to.”