I've been working from home for about a month, starting when the Wall Street collapse began. This past week, I was back to riding the train to NYC again, and was shocked to see a very noticeable decrease in the number of suited passengers. Stamford is normally the busiest stop, with swarms of men and women in high-end business attire getting on and off the train. Now there's hardly anyone. Normally the morning train is standing-room only, with five or six people standing in every doorway. Now there's plenty of empty seats.
The news reports I've read have all been focused on the bail-out and on how the banks are currently spending money. There have been plenty of incendiary reports about bankers being given raises and bonuses, and exposés of corporate partying. What I wasn't aware of until this week are the huge numbers of layoffs. So far approximately 110,000 people connected to Wall Street have lost their jobs, with more layoffs anticipated. No wonder the train wasn't crowded. No wonder Stamford looks like a ghost town.
I have also read a Forbes report on towns most likely to suffer during this economic whatever-you-want-to-call-it. They cite the small town (25,500 people) of Zanesville, Ohio, which has an unemployment rate of 8.9% (Waterbury's is 8.6%, according to city-data.com), a poverty rate of 16.2% (35% of Waterbury households earn less than $25,000 per year), and an education statistic of 18% with an associates degree or higher (compared to 23% in Waterbury).
Zanesville's mayor is optimistic about his town's future, pointing out that they have plans for more than $250 million in school and downtown development construction over the next two years (sound familiar?). The article, not surprisingly for Forbes, does not spell out exactly what dangers Zanesville and other vulnerable towns face, nor does it in any way suggest what actions might be prudent for vulnerable towns. I would like to know those details, especially since it sounds like Waterbury could also be considered vulnerable. We've already seen fallout from the mortgage fiasco--foreclosures on homeowners who couldn't make payments when their subprime mortgages adjusted to higher rates, and numerous properties purchased by real estate speculators who drove the prices up without adding value and have now abandoned the properties, leaving pockets of blight throughout the city.
In that regard, maybe Waterbury has already seen the worst of the mortgage fall-out (just don't expect to get a good price if you're selling a house right now). Unemployment could very well increase. We're seeing a steady decline in the number of big stores, not just in Waterbury. We've lost two grocery stores, and it looks like they won't be replaced. The national chains are steadily going under: Steve & Barry's declared bankruptcy and closed their Waterbury store; Linens N Things declared bankruptcy and is closing its Waterbury store. When the plaza with Linens N Things first opened, there was a craft supply store on the other side of Stop & Shop which closed almost immediately and has yet to be replaced. I doubt that Linens N Things will be replaced. Waterbury is turning into a town of half-empty plazas.
On the bright side, the prices of gasoline and heating oil have decreased significantly. But that's probably not much consolation for anyone who's lost their job because their employer went bankrupt or lost their house because the bank increased their mortgage interest rates so much that they couldn't make their payments.