Route to Recovery

A trip through the epicenters of the recession

The most unemployed town in America — or is it?

November 4, 2009

ROUTE-RECOVERY/If you’re looking for ground zero in America’s longest and deepest recession, El Centro in southern California appears on first glance to fit the bill.

The unemployment rate here and for the whole of Imperial County hit 30.1 percent in September, the highest rate in the United States. Locals say there is no denying that El Centro has suffered as a result of the recession and that jobs are more scarce in an area where agriculture is the backbone of the community and forms 25 percent of the local economy.

“We’ve always had high unemployment, but nothing like this,” said Judith Klein-Pritchard, director of the Center for Family Solutions of Imperial Valley, which provides intervention for domestic violence and shelter services in the area.

However, officials like El Centro city manager Ruben Duran say the jobless numbers don’t tell the full story.

Duran points to the fact that back in March 2006 unemployment in Imperial County fell to 12.2 percent and the number of employed people in this county of around 160,000 totaled 54,057.

But when unemployment hit 30.1 percent – well over double the rate in March 2006 — the number of employed workers slid less than 1 percent, to 53,734. City revenue from taxes is only down about 10 percent this year, Duran said, which also does not tally with the sharp rise in the jobless rate.

“Yes, there has been hardship and suffering here,” Duran said. “But where did all those extra unemployed people come from if the number of people in work has barely fallen?”

Tim Kelley, head of the Imperial Valley Development Corporation – a pubic private partnership set up to diversify the local economy — said some of the rise in the unemployment rate comes from El Centro residents scattered about the country who have lost their jobs because of the recession and have come home to stay with relatives. Or that some of them are Mexican immigrants who have lost their jobs in the United States, have returned home and are claiming unemployment benefits in El Centro because it is a stone’s throw from the border.

“There are people who are working the system and that affects our unemployment figures,” Kelley said.

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Drive around El Centro, a city of some 48,000, and it does not feel like some of America’s long-suffering communities like Flint, Michigan, where collapsing auto sales amid the recession have led to an unemployment rate of 15.8 percent. Whereas Flint is dealing with shuttered businesses and abandoned homes, relatively few stores have closed in El Centro.

Duran said the key to understanding the local economy and El Centro’s high jobless rate lies just across the border in the city of Mexicali, a city of more than 1 million people.

“The border bleeds both ways,” he said. “Many people who live here work in Mexicali. The trouble with the statistics is they stop at the border and don’t take into account the role a major city across the border plays in our economy.”

Photos by Lucy Nicholson

For more Route to Recovery stories from El Centro, click here

For the Route to Recovery live blog, click here

Comments

I travel between Western MA, Cape Cod MA and New Hampshire. People are really struggling right now. In my travels I see more and more homes for sale, more vacant retail space and more trucks, cars, boats, snow mobiles and other toys for sale. Even construction workers are selling the tools they would normally use to earn income just to survive. Most of my friends are what you would call high income earners. They are professionals or small business owners. Due to circumstances beyond their control ( the economy ) many of them are just barely hanging on financially now. I do not see any signs of recovery or “green shoots”. For the first time ever I have been seeing locomotive cars stored on the tracks with weeds growing up over the axels. What industry will put all the unemployed back to work ? A double shift at McDonalds or Dunkin Donuts just will not do. Our leaders are sayiny that the recession has ended. These are the same people that did not see any of the collapse comming. Are we to believe them? I say that the citizens in the trenches will be the ones who will know when the recession is really over.

Posted by JIMI D | Report as abusive
 

I think your map needs revising. Evansville IN is in SW Indiana, not the center of Illinois, and Bentonville AR is probably not in Missouri.

 

Jimi, this country wasn’t founded on the basis of the government making sure everyone lived a perfect life with no bumps along the way, it was founded on the basis that everyone has the opportunity to go out and make the best for themselves. This is a recurring tone around America right now, complaining that the government hasn’t provided them with the perfect high paying job. We’re in a recession which is historically when good ideas sprout into thriving companies in the future. We started this country with good ideas and hard work, now all we do is complain that the government isn’t taking care of us. Its time to go out there and make a change for yourself instead of expecting the government to make the change for you.

Posted by Pat Smith | Report as abusive
 

Pat Smith – I never mentioned that the gov should take care of us. I did mention however that do to the down economy people are really having a tough go of it. Why is it that you think we are all fat and lazy and waiting for a hand out? People like you always jump to that same conclusion. My self-employed friends don’t want or expect a hand out – They just want some customers who will spend some money. A mechanic friend says most customers just do the absolute minimum to keep the car going. He is generating a lot less income these days. I have lived through three recessions to date, this one being the fourth. This recession is by far the worst! Maybe your world is all peaches and cream Pat, but for many hard working people out there it gets more difficult with each passing month.

Posted by JIMI D | Report as abusive
 

Pat – What our government DID DO is to take tax payer money and give it to the people who almost collapsed the banking system. Those bankers are now enjoing HUGE bonuses and living pretty damn well. Our children’s children will be paying off the money our government gave to the banks that screwed up. The disconnect between the halves and halve not’s has never been greater. Also Pat, we started this country by taking with force was was not ours and then using SLAVES to do the HARD WORK.

Posted by JIMI D | Report as abusive
 

Pat,

This isn’t 1776. One can’t simply “go west” and start anew living off the land.

While I agree that it isn’t government’s job to make sure that everybody is happy, it should work to create an environment where people CAN take care of themselves. One thing our government HAS done in recent years is redistribute wealth upward to the people at the top and make it easier for those people to reinvest that money not here in America, but in places like Communist China. This is at the direct expense of working Americans. This is “trickle-down” and globalized “free” markets at work.

Enjoy.

Posted by JML | Report as abusive
 

Jimi – Thanks for the report
Pat – Of course you’re right.

How is it that America, for 2 decades conducting a rampant reckless ‘Anglo-Sexton’ capitalism, where everybody swear to defend the ‘vastly superior’ economic system to the last breadth, now look to the supposedly ‘bad’ government for handouts and bailouts?

The depth of a recession is equal and opposite to the depth of the deception that caused it.

It was during the 2 decades of good times that mistakes built up. The current recession is simply the period to reckon with and repair the mistakes.

Yes the government has made mistakes. All they can do is to throw out the bums and borrow even more money.

But the grandest mistakes were made by the private sector. Especially the elite and powerful of the private sector, who were given vast powers and freedom, via privatization and de-regulation, during the past 20 years. They were supposedly to propel the country to vast economic height, make the superpower even more super. Instead they pursued policy of unfettered greed, while the populace supported them with a culture of instant-gratification.

So 20 years of economic gains stand to go back to the junkyard. Because the gains are in fact junk. Trouble is: if you make something that’s junk you just lose it. But if you borrowed to make the junk, you lose the junk but the debt not only stays but gets ever bigger. It is a simple concept, has been around for 2 thousand years. Yet the American populace failed to appreciate it. So now we have lots of free time to appreciate it. Including the babies who will inherit 2 generations of debt piled onto them. No wonder they are doing some serious crying of late.

Trans-generational irresponsibility of historic order.

Posted by The Real Deal | Report as abusive
 

I used to work in CT and lived in NY. When I was laid off, I collected unemployment from CT. NY would not allow me to file because I did not work there in the past year.

I don’t know California’s tax code, or if the US has a reciprocal agreement with Mexico(NAFTA?), so my take is – let them file unemployment in MEXICO! If you didn’t wrok in El Centro, then El Centro has no money from taxes to support you.

Posted by annoyed | Report as abusive
 

Hi Pat: I can’t argue with your facts and very much sympathise with your attitude toward the TARP bailouts (especialy the bonuses issue – and the double talk that convinced Congress to allocate the TARP funds in the first place and let’s not discuss the dubious impact of the second stimulus package)- but I understand enough about finance to know that your children and grandchildren will not be paying the bill. Have you ever noticed the debts leftover from WWII? What your children and grandchildren will inherit will be a devalued currency.

That adjustment is not without it’s costs – obviously. It means every bill they pay will be paid in numbers that will make us, their “old-timers” – be saying – “remember the good old days when oil only cost $2.75 a gallon?

And the irony of it all is that the value of the oil and any other goods and services relative to each other, in the time your grandchildren’s maturity, could actually be the same and quite possibly less than it was in the “good old days”.

If the government’s of the world actually succeed in reducing or even elliminating the use of fossil fuels, the price of those fuels could drop dramatically simply because they were no longer economical (the fuel might be cheap but the costs of using it – the cost of scrubbers and other technology to sequester CO2 would be added to that cost. It might even be illegal to use at all. Perhaps that is not likely to happen in our life time but who knows?

And to the other comments that suggest that the US government had no historic role in intervention to assure standards of living are forgetting that the US government in the late 19th century was very much involved in insuring that large numbers of the population had a chance to make a living . What do they think the Indian Wars were about? The army took land and secured it from the native inhbitants. The railroads bought up vast swathes of that new territory and made fortunes selling the left over lands flanking their rights or way to new settlers for their homesteads and new towns and insured themselves a customer base for their service. Those commenters would have voted for Hoover and Coolidge.

“American ingenuity” is not unique to America. There isn’t a country in the developed or developing world that doesn’t believe it isn’t as ingenious. I’ll bet most of the people who think that this country is the only inventive country have ever done much foreign travel, nor have they read much economic, social or political history of either this country or any other.

But what America had then and doesn’t have now, is a continent ripe for the taking. Some would even say – “ripe for the raping”.

Posted by paul rosa | Report as abusive
 

@drewbie — we’ve fixed.

Posted by Richard Baum | Report as abusive
 

Well the thing is the people filing for Unemployment are filing because they worked in the US, they paid taxes in the US and they are entitled for unemployment benefits. You can be certain that there are people working three jobs and they know their rights.

Bottom line is there must be money since it is already deducted from their pay check on previous years. Otherwise US will be stealing from them.

 

Workers comp is a state program. So you can file for it from anywhere in the state. Cheaper to live in Mexico and collect earned workers comp in the U.S. Don’t blame me for it, some of them are legals and some of them are illegals. I don’t get a say about the illegals, they are usually employed by large companies or by contractors to large companies.

Posted by Jackie | Report as abusive
 

I have read a book about the ghost twons in the united states, the young people left for the big cities, because there were better life, and only the old stayed, and after a while they died, and the twons became empty for people. This still happen today in many countries.

 

how about this?? what if the government just got the hell out of the way?? what do i mean??let’s try a big nasty tax cut…especially for the small business owners.let’s also cut capital gains taxes,,,maybe that’d lure some companies back from overseas..let’s make advantageous for business’s to set up shop here,,not elsewhere.you do that by the government dropping these taxes,,and butting out,,,just a thought

Posted by vejer | Report as abusive
 

I drive to San Diego from Phoenix a few times a year, and always like driving through the El Centro area. It is truly an oasis in the desert, with miles and miles of fields stretched out on both sides of I-8. For what it’s worth, I wish only the best for all those in that city, be they legal or not, and look forward to my next trip through there.

Posted by JohnF | Report as abusive
 

The government is implicated. Clinton signed NAFTA, having to know it would decimate our economy. That is what made American-derived jobs look better to greedy entrepreneurs who decided to move them over seas. There would only be one way to change the situation. The dollar is devaluing anyway. Government should devalue it across the board, government and citizen debt, payment, business and savings. Then they should put a huge tax on those who keep businesses originated in the US overseas, seize any income they make in the U.S., or deport them permanently, along with Clinton and his ilk. Our economy would pick right up.

 

The people of america have been financially raped by corporate america (again), and fail to see it. If I were in a position as this, i would march to washington and create a protest against the corporate crooks who put the situation america is in. America you have been fooled again (remember S&L?), and will be fooled again and again, until you step up to the plate. Wake up and be a true american patriot!

Posted by Tony | Report as abusive
 

Just to add a bit more, there is no economic crisis, the economic crisis is just a scam to steal the wealth from the working class through wall street scams & higher tax payer bailouts, (someone has to foot the bill) to pay the debt for the (un)Federal Reserve for the rest of future generation tax slaves.
Obama dosent deserve the Nobel peace prize, get america out of this mess, then we will see if he deserves it, but no, he answers to the banks & wall street. All presidents and future presidents are just front men for the banks and wall street, nuff said!

Posted by Tony | Report as abusive
 

If you have ever been to El Centro you would know why so many home are vacant. The weather is extreme in the summer like an oven. This is not oasis, it is located in the Movhave Desert, Dohhh!

Arizona is governed by idiots, a totally Republican agenda has the State in a horrible mess.

BTW, this happened under BUSH, Clinton was far gone before the housing bubble.

Posted by Dennis | Report as abusive
 

i think the numbers are certainly skewed. but overall it does seem like an unfortunate situation. the government has lots of other things on it’s plate to deal with and I think if they want help, they’re going to have to be loud about getting government help. the loudest usually get their way in this world, and with a long queue of things-to-do for the federal government, i think dealing with this county is fairly low down on this list.

 

Now it is about 6 months after the report. I am wondering what is the latest status of these towns and whether it is still as bad.

 

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