Recently Forbes.com published a feature on America’s 20 Most Miserable Cities. The web site looked at 200 US cities and considered several quality-of-life issues, including unemployment, to determine each city’s misery ranking. Cleveland; Stockton, California; Memphis; Detroit; and Flint, Michigan won unenviable recognition as the nation’s most miserable places to live. Hoover’s Editors wondered how two of the largest companies in each metro area may have contributed to their misery or, more hopefully, allayed it.
This diverse company provides electrical power distribution and control equipment, hydraulic products, and aerospace propulsion systems, among other technical products. Ideally, Eaton’s wide variety of output would provide a cushion in a bumpy economy, but it is has been struggling still. In 2009 the company instituted cost-cutting measures that included employee reductions.
A technical equipment maker like Eaton, Parker Hannifin has also struggled in a tough economy. After sales fell about 15% and operating income sank by more than 45 percent in 2009, the producer of such products as fluid connectors, refrigeration components, and engine systems, took steps to reduce its workforce, freeze salaries, and implement shorter work weeks.
In contrast with Cleveland, the largest company in Stockton, California hasn’t had any news of major layoffs. More to the point this company that distributes food to the US armed forces in the western US and Far East recently scored a $10 million contract from the Defense Commissary Agency.
The recession seems to be helping this cooperative in the Stockton area that distributes fruit and tomatoes for about 170 growers. More and more consumers are responding to the recession by buying its private-label brands. And it doesn’t hurt that one of its customers, the USDA, advises the consumption of five or more fruits and vegetables a day.
Though this major delivery service has been expanding, having recently inked a deal to provide shipping services at more than 900 OfficeMax locations, other developments in the economy, like high fuel prices, have put a strain on its bottom line. In reaction, FedEx implemented a hiring freeze in 2008 and announced layoffs in 2009.
Like any other US company, International Paper, the world’s largest forest products company, struggles with declining business because of the recession and the high cost of energy. Analysts report that it is having trouble with its consumer packaging segment, but they add that it should stay competitive because of its international operations and large customer base. No large layoffs at the company have been reported recently.
Though this troubled auto giant was shored up by billions in loans from the US government, it has become synonymous with mass layoffs and gas-guzzling cars. In 2006 GM employed about 110,000 factory workers. By the summer of 2009 that number was reduced to 48,000. The company has also cut 7 percent of its white-collar positions.
Unlike General Motors, Ford didn’t need any loans from Uncle Sam, but it is still sputtering through a tough economy and has had to reduce costs. Those efforts have included job cuts. In 2009 Ford reduced its North American salaried personnel by nearly 10 percent. In 2008 Ford cut its worldwide workforce by 13 percent.
Health care has been one of the bright spots in an ailing economy. And thankfully for Flint its largest company is HealthPlus of Michigan, which provides health care coverage for some 200,000 members in about a dozen Michigan counties. For the past five years U.S. News and World Report has ranked HealthPlus of Michigan as one of the nation’s top 50 commercial plans and top 25 Medicare plans. The company also recently started some insurance plans that will help those who have been laid off.
Perhaps it might bode well for Flint that its second largest company is another health care concern. Hurley Medical Center is a teaching hospital affiliated with Michigan State University and the University of Michigan. Its 440-bed facility serves three counties in eastern Michigan. Though this is one business that would like to see a reduction in customers, that isn’t likely to happen with the aging of the US population and the added stresses of the continuing recession.