The Gold Rush of the 1800′s caused many people to head West. Just like any bubble, the phase eventually dried up and people were force to abandon everything in search of something new. This obviously led to Ghost Towns springing up all over the place.
For the most part, Ghost Towns are represented by your old saloons and small “Western movie” type towns, yet is it possible for new Ghost Towns to be developed in the era?
If you have ever taken a road trip of some length, then you probably realize how many cities and towns there really are, and you probably ask yourself, “how do these people making a living?” Often times, these towns are dependent on some main source of economy, such as major factories. If that market is having trouble, then most of the town is going to be struggling. Just look at Detroit. On a bigger scale, the automotive capital is seriously struggling right now.
Luckily bigger cities offer more opportunities. So to really see where Ghost Towns are evident, we have to look at small towns.
Just a couple days ago, shipping company, DHL, announced that they would be closing its hub in Wilmington, OH. While it isn’t the only hub to be closing down, Wilmington has a population of 12,000 and 3,000 of them work at DHL. For you math majors that is 1/4 of the town that will go unemployed. We can also combine that with the fact that most of the other people get their jobs from other counties.
In order to fully understand the nature of this “crisis,” we have to look at the overall externalities. In many suburbs or small cities, majority of the work comes from some sort of service area (i.e insurance, retail stores, banks). What happens when the people in the town suddenly have no money? Obviously they can’t spend it on any of the services. Suddenly all the other job options are in trouble. One they don’t have the money to hire any of the laid off DHL employees, and, second, the DHL employees don’t have any money to spend on the service. Now we have an entire city in turmoil.
People cannot just sit and wait they are forced to find action and that means leave the town. An insurance agent Eric Welch is giving up on Wilmington and shutting his business by the end of the week (CNN).
“I don’t see the long-term future in this community for me as an insurance agent to be very rewarding,” said Welch, who is leaving town.
As these services begin to leak out of the town, what is left? How can these people make money? The opportunities are not as abundant as in bigger cities.
So while we may not necessarily see the completely abandoned town like the ones created in the early 1900′s, isn’t it still possible to see some form of them? As more companies begin shutting down locations, the odds greatly increase.