May 6, 2021

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How to fix what the innovation economy burst in America

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Valerie worked at Bryan Metal Systems, making suspensions for Chrysler. She was making a lot of money there, but the company was acquired in 2005 by Global Automotive Systems. In 2010, Global closed the Bryan plant and sent the work to Michigan as part of a “global optimization strategy”. Valerie traveled to Michigan to help train her replacements. After that, she bounced back, sometimes working temporary jobs in a factory, until she landed at the Sauder Furniture Factory.

In 2019, unemployment was below 4% in Williams County, but higher-paying jobs had been replaced with low-wage, “temporary” status jobs that employers were keeping – in name only – so that they wouldn’t. do not have to pay any benefits. Menards, a large Midwestern home improvement retailer, has grown to become the county’s largest employer. Menards fought for a rich package of tax and infrastructure incentives with local and state government in exchange for setting up a distribution center about 15 minutes northeast of Bryan. At the end of 2019, people were starting at around $ 14 an hour, or about $ 28,000 a year, for a full-time job. Over the past 20 years, the median household income in Williams County (in constant dollars) has fallen from $ 62,000 to $ 49,500. Defined benefit pensions have given way to less generous retirement savings accounts. Health insurance premiums have increased. So have deductibles.

As the employment landscape has changed, the demographics of the county have changed. Young people, especially young university graduates, have left and have not returned. I asked the McCaslins, the outgoing Four County Alcohol, Addiction and Mental Health Council chief and native of the area, how he thought they could be persuaded to return. He recalls a recent economic development meeting: “We were talking about the city. And I just said, ‘Why would you want to come here? Why would I bring my two children? And there was silence in the room. You had commissioners there and they couldn’t find a single reason.

The Ménards effect

Bryan Hospital, Community Hospitals and Welfare Centers (CHWCs), have caught the fallout from these changes. As was the case in many of these communities, CHWC, an independent community hospital, has become the city’s largest employer. But he struggled to stay open and independent. As the county’s population grows poorer and older, many patients have qualified for Medicaid or Medicare, both of which pay lower reimbursement rates than private insurance. (The two government programs represent two-thirds of CHWC’s income.) So even though, say, an MRI machine costs the CHWC as much as another hospital in a richer area, the CHWC is paid at a lower rate. when used.

Former hospital CEO Phil Ennen calls this the “Menards effect”. The business was “a real problem for us,” he says. “Seventy-five percent of Ménards [employee] accounts with us are Medicaid, charity, or some sort of self-pay. From a health care perspective, they are a horrible employer.

A lot of people were like Valerie: they just didn’t go to the doctors. The spring after we sat down in the church basement, Valerie was there, this time counting the Girl Scout cookie money with her daughter and a friend. She still worked three jobs. His back ached from an old injury during his days at Bryan Metal Systems. And she was coughing from an insect she thought she had caught from a colleague of Sauder’s. Valerie had bronchitis, an inner ear infection and a sinus infection, but she didn’t miss any work because she didn’t have paid sick leave. “No! I went to work every day,” she laughed, causing a brief coughing fit.



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