Small towns hit hard by e-commerce’s rise
When factories exited places like Johnstown, Pa., retail work stepped in. Now it’s disappearing, too.
JOHNSTOWN, PA. — Dawn Nasewicz comes from a family of steelworkers, with jobs that once dominated the local economy. She found her niche in retail.
She manages a store, Ooh La La, that sells prom dresses and embroidered jeans at a local mall. But just as the jobs making automobile springs and rail anchors disappeared, local retail jobs are now vanishing.
“I need my income,” said Nasewicz, who was told that her store will close as early as August. “I’m 53. I have no idea what I’m going to do.”
Nasewicz is another retail casualty, one of tens of thousands of workers facing unemployment nationwide as the industry struggles to adapt to online shopping.
Small cities in the Midwest and Northeast are particularly vulnerable. When major industries left town, retail accounted for a growing share of the job market in places like Johnstown, Decatur, Ill., and Saginaw, Mich. Now, the workforce is getting hit a second time, and there is little to fall back on.
Moreover, while stores in these places are shedding jobs because of e-commerce, e-commerce isn’t absorbing these workers. Growth in e-commerce jobs like marketing and engineering, while strong, is clustered around larger cities far away. Rural counties and small metropolitan areas account for about 23 percent of traditional U.S. retail employment, but they are home to just 13 percent of e-commerce positions.
E-commerce has also fostered a boom in other industries, including warehouses. But most of those jobs are being created in larger metropolitan areas, an analysis of Census Bureau business data shows.
Almost all customer-fulfillment centers run by the online shopping behemoth Amazon are in metropolitan areas with more than 250,000 people — close to the bulk of its customers — according to a list of locations compiled by MWPVL International, a logistics consulting firm.
The Johnstown metropolitan area, in western Pennsylvania, has lost 19 percent of its retail jobs since 2001, and the future is uncertain. At least a dozen of Ooh La La’s neighbors at the mall have closed, and a “Going out of business” banner hangs across the front of the sporting goods store Gander Mountain. “Every time you lose a corner store, every time you lose a restaurant, every time you lose a small clothing store, it detracts from the quality of life, as well as the job loss,” said John McGrath, a professor of management at the University of Pittsburgh Johnstown.
This city is perhaps still best known for a flood that ravaged it nearly 130 years ago. After rebuilding, Johnstown eventually became prosperous from its steel. For generations, people could walk out of high school and into a steady factory job.
But today, the area bears the marks of a struggling town. Its population has dwindled, and addiction treatment centers and Dollar Generals stand in place of corner grocers and department stores like Glosser Brothers, once owned by the family of Stephen Miller, President Donald Trump’s speechwriter.
When Trump spoke about “rusted-out factories scattered like tombstones across the landscape of our nation” in his inaugural address, people like Donald Bonk, a local economic development consultant, assumed that Miller — who grew up in California but spent summers in Johnstown — was writing about the old Bethlehem Steel buildings that still hug long stretches of the Little Conemaugh River.
The county voted overwhelmingly for Trump.
Here and in similar towns, when the facory jobs left, a greater share of the workforce ended up in retail.
Sometimes that meant big-box retailers like Walmart, which were often blamed for destroying mom-and-pop stores but at least created other jobs for residents. The damage from e-commerce plays out differently. Digital firms may attract customers from small towns, but they are unlikely to employ them.
Randy Clark remembers when his Miller’s Clothing Store, a family-run menswear shop, employed twice as many people and sold 20 pairs of pants a day. He knows he needs a website, but attracting digital customers is the least of his concerns. Brands that he sells, like Tommy Bahama and Southern Tide, will not even let him sell their products online, where he would compete with their own e-commerce operations, he said.
So instead, Clark has focused on the store itself. He renovated the first floor, bought new furniture and new floors, installed a coffee machine, and donated old sports coats and corduroy jackets to make room for fresh inventory. He wears a suit and tie to work six days a week, and says he does not own a pair of jeans.
“Not a lot of people dress up anymore,” Clark said. “If I don’t dress the part, who will?”