Following our Route to Recovery special report, we asked contributors from Associated Content to tell us their stories about the recession.
By Cheryl Williams
It was October 2008. I was sitting in the lobby at a doctor’s office in Charlotte, N.C., waiting for a physical for my new job. The waiting room was filled and all eyes were on the TV. The stock market was plummeting and it was clear that the American financial system was in crisis mode. Strangers who normally would never be speaking to each other were engaged in deep conversation about the economy. I remember thinking how blessed I was to have finally found a job.
I now work as a house mother at Angel House Maternity Home, a group home for pregnant women in Charlotte. Before coming to Angel House, most of our clients were homeless or living in shelters. Because our agency is non-profit, we felt far-removed at the time from anything going on with Wall Street. It didn’t take long for me to see how wrong I was.
In July, my boss informed us during an emergency meeting that the situation was bleak; there was a chance all of the maternity homes in the area would lose funding. She said she was preparing us for the possibility we might not have a job in the near future. Until she received the final word on budget cuts, she had to close the maternity home in August. This was bleak news for employees and for the women who lived at Angel House. They now had to find a place to stay for a month until we learned our fate.
To compensate, we cut back and have been more mindful of any kind of waste. We utilized the food bank more. We spent more conservatively. Not only were we worried we might lose our jobs, we were concerned for the pregnant women who could be forced back to the streets.
A month without a paycheck damaged my finances. Some bills did not get paid and late fees accrued. My husband had to pay for everything with a paycheck that doesn’t cover it all. I only work part-time, but the loss of $750 that month hurt. We cut 20 percent from our grocery and gasoline bills.
At work, the worry continued. In September, The Charlotte Observer reported fears of “another year of shriveled budgets” for many non-profit agencies in the area.
But after four weeks of closed doors, we learned our maternity home only lost part of its funding. We had to take a pay cut, but we’re relieved nonetheless. We can keep our jobs and the women can keep their homes.
Life is looking up a bit. But we proceed with caution on shaky financial ground.
CHARLOTTE, North Carolina – Unlike most of America, many of the people here who have lost their jobs are highly paid white collars in the country’s battered banking sector.
“The impact of these job losses is far greater than your average job because these bankers were making six- or seven-figure salaries,” said Tony Plath, a banking professor at the University of North Carolina in Charlotte. “This represents a structural shift for the economy in Charlotte.”
Charlotte has been known as a banking center for years and until the crisis was dominated by two major banks with headquarters here, Bank of America and Wachovia. With 60,000 jobs, the finance sector was the biggest part of the local economy.
But as the housing bubble burst and pushed the country into recession starting in December 2007, the fast and loose lending practices of the boom pushed banks like Wachovia toward the abyss. In December, Wells Fargo took over Wachovia in a government-brokered sale, thus removing one of the city’s two financial pillars.
“We’ve lost one bank headquarters and we’re still trying to work out what that means,” said Bob Morgan, head of the city’s chamber of commerce. “The other bank is having a change of leadership and we have no idea what that means yet.”
Bank of America is looking for a replacement for Ken Lewis, its beleaguered CEO, who is due to retire by the end of the year.
The unemployment rate here in September was 11.6 percent, above the national average of 9.8 percent. Morgan insists that the city’s economy is diversified and that banking is not as dominant as people make out.
“Mostly what we’re suffering from here is what is affecting the rest of the U.S. economy,” he said. “Once the U.S. economy comes back Charlotte will too.”
But Plath said that for many of the 4,000 people who have lost jobs in the financial sector here, there are no alternatives at the moment.
“It used to be during the boom that you lost your job at a bank you could find another one within 90 days,” Plath said. Now you’re looking at a minimum of nine months.”
“You can’t just walk across the street and get a job because there are no jobs to be had right now,” he added. “For some people the only alternative is to switch to a different industry at a lower level or buy a business. Either way, their salaries are going to significantly lower.”
Richard Daileader, 52, worked for a financial company up in New York but lives in the Charlotte area. He took time off after taking a “separation package” in the fourth quarter of 2008 and is now looking for work here.
“There is nothing out there at the moment,” he said. “But I’m getting indications that there may be some hiring going on in the first quarter.”
Mary Tribble, head of Tribble Creative Group which organizes corporate events in the city, said that revenue fell 40 percent in 2007 and is down 40 percent this year due in large part to the banking sector’s implosion.
“If it weren’t for other businesses that we have developed, we would not have survived,” she said.
The city now has to adjust to a new reality in which not only are there fewer banking jobs, but the one remaining bank may be less likely to spend so much on philanthropic projects.
“The city was too reliant on having the two big banks here,” said Raymond Groth, a managing director at local boutique investment bank Fennebresque & Co. “When there was a problem people looked to Bank of America or Wachovia to solve it.”
“Now Charlotte is going to have to become more diversified,” he added. “But the city will benefit in the long term as a result.”
CHARLOTTE, North Carolina – The financial crisis and the longest, deepest U.S. recession almost destroyed Mary Tribble’s business, but despite the pain that has involved she is enjoying being able to concentrate on what she enjoys.
“I could have ended up spending my life arranging Budwieser beer bashes for companies,” she said while overseeing preparations for a Chamber of Commerce event in downtown Charlotte. “But instead now I get to focus on social initiatives. They’re the reason I get up in the morning.”
Tribble Creative Group has been in business for 25 years and most of its revenue over the years has come from arranging corporate parties and conferences. Business was good in town, particularly thanks to the headquarters of two major banks – Wachovia and Bank of America – which were the cornerstones of the economy here.
But then the housing crisis and recession hit. Wachovia has been absorbed by Wells Fargo and Bank of America has cut back on lavish events, as have many businesses across town, pushing Tribble’s revenue down 40 percent in 2008 and down 40 percent so far this year.
As a result she had to cut her staff to eight people from 14.
“That was by far the most painful part,” she said. “We held on as long as we could but we had to let people go.”
“But if we hadn’t branched out before the crisis hit, then we would not have made it through the crisis.”
The social initiatives that Tribble has launched are the North Carolina Governor’s Conference for Women, which promotes the discussion of women’s issues, and Girls Rock the House, which works to persuade 8th grade school girls to get into politics.
“There is a clear and solid business case for projects involving social change and the difference they can make,” she said. “So we haven’t seen the kind of drop in business there that we have seen for corporate events.”
“Compared to the corporate events, they (social initiatives) are a no-brainer for corporations to continue with,” Tribble said. “If it weren’t for those programs, we wouldn’t be here now.”
CHARLOTTE, North Carolina – After more than two weeks on the road, Mary was a breath of fresh air.
Everywhere we have been we have found people to be friendly, helpful welcoming and curious about our cross-country marathon, not to mention incredibly patient.
But there was something about Mary that truly made her stand out, from the moment Carlos and I stepped on the Avis airport shuttle bus in Charlotte.
She turned around when we stepped on board and asked us with a big smile where we were going and whether we were going home. I explained the nature of our project, that we were trying to see how people were faring in different parts of the country after nearly two years of recession.
She paused a moment and said:
“I’m sure that everyone is doing just hunky dory. Because no matter how bad things get, people find a way to be hunky dory. They have to.”
After imparting her nugget of wisdom, Mary’s grandmotherly face broke into a grin and she spent the remainder of the trip teasing us, laughing out loud and coyly resisting having Carlos take her picture.
Something about Mary’s easy, unquestioning faith in mankind’s ability to make do in the face of adversity left us grinning as we found our way through the airport. It may not sound like much, but after 15 days of non-stop travel and work, Mary’s sunny disposition brightened our day and we felt luck that we got on that particular bus.
CHARLOTTE, North Carolina – When Richard Daileader was let go from a financial services company during the meltdown, he realized it was the perfect chance for an unusual sabbatical.
“For years my daughter and I had talked about hiking the Appalachian Trail,” he said. “When I was let go, she told me that there would never a better time for me to do it, so I went for it.”
After 30 years in the financial sector and 2,178 miles on foot, he’s wondering what to do next.
Daileader, 52, had four or five jobs in his career.
“I never had any time off between any of those jobs,” he said. “I always finished on the Friday and was in my new job on Monday.”
Prior to becoming unemployed, Daileader was commuting back and forth from Charlotte to Churchill Financial in New York, where he looked at potential acquisitions alongside private equity firms. Financing was raised through securitization, packing and selling bundles of loans on the capital markets, but the financial crisis brought that to an end.
“In 2007 the market began to fall apart and in 2008 funding became increasingly hard to come by,” he said. “Then someone hit the brakes and that market went away.”
Daileader was given a decent separation package by Churchill in the fourth quarter of 2008.
“I didn’t have any great epiphanies while I was on the trail. Most of the time I was just focused on putting one foot in front of another,” he said. “But I am very lucky. I have no complaints because unlike many people I don’t have to live paycheck to paycheck and didn’t have to worry about finding another job immediately.”
After almost a year without work, Daileader said he has been thinking about getting back into banking.
“No one is hiring right now, though it looks like there may be some openings in the first quarter of next year,” he said. “What jobs there will be will likely have lower compensation following the financial crisis.”
“I don’t want to go back to New York, I’d rather stay here in Charlotte,” he said. “And one thing that I did realize on the trail was that I don’t want to kill myself with work anymore.”
At the moment he is talking informally to a defense contractor who wants to sell his business and retire. He may decide to leave the banking sector altogether and find work away from the city. In short, Daileader is not entirely sure what to do next.
“I’m not antsy yet about what to do and I have been frugal the past year,” he said. “But around the end of the year the separation package is going to start to run low and that it is going to start limiting my options.”
“Life was a lot simpler out on the trail. I put my country club membership on hold and now I realize I don’t need it.”
CHARLOTTE, North Carolina – With no work, no home and few prospects, all Roy Hawkins, Mark Corbett and Drew Everhart have is each other.
“We’re pretty much what you’d call a brotherhood,” said Corbett, 48, sitting in the makeshift camp he set up in the woods about an hour’s walk from the center of Charlotte in January 2008 and which has been his home ever since. “We look out for each other and we share what we have.”
Hawkins, 44, has been with him on and off since then, since he received his prosthetic leg three months ago. He lost the lower half of his leg in an accident in April.
“When you lose your leg, you lose your livelihood,” Hawkins, an electrician, said.
Everhart moved into the camp about three months ago. He ended up in Charlotte around a year ago after an accident on a construction job. Corbett is also a construction worker, with few possibilities for full-time work because the U.S. housing crisis and the recession it spawned have wiped out many construction jobs.
“There’s nothing out there for us right now,” Corbett said. “But things will get better soon.”
We met these three homeless men at the Urban Ministry Center where they had turned up for a meal at the soup kitchen, and they agreed to let us follow them around for the day.
That day included following them to the library in Charlotte where Hawkins fills out job applications and checks whether his application for disability benefits has been approved.
Then we walked more than an hour in the hot sun with Corbett and Everhart to their camp. Hawkins goes by bike, because he cannot make the distance on foot.
As we walk, Corbett and Everhart tell us about the day laboring work they do for an agency, which sends people out to work as unskilled and semi-skilled laborers — usually construction or demolition work. If they get a day’s work, they get $40 after taxes.
This involves walking two hours from their camp to be at the agency by 5:30am; otherwise there is no chance they will find any work.
“If we’re lucky, we get one or two days of work a week,” Everhart said. “Sometimes there are 50 or more guys out there and maybe 10 of them get work.”
He added that standing in line at the agency is often a tense experience, as some men push in line. It’s not easy to know which ones to push back against, as they may be armed.
“If you’re not careful you can get stabbed,” Everhart said. “We’ve seen it happen. Some guys are desperate to work and it’s best not to get in their way.”
The men said they often lose out to younger men, who are preferred by the temp agency for the physical work they do.
On the days when they don’t get work, Corbett says the three men have different “hustles” or ways to make money.
“But I won’t do anything illegal. If you let your standards go out here it’s a slippery slope,” he said. Corbett’s hustles include collecting aluminum cans for money, or offering to do odd jobs such as mowing the lawn at homes around Charlotte.
Everhart has an ex-wife and has to pay child support, so some desperate days he “hangs the sign,” standing by the road with a sign saying “hungry and need work” or a variation on that theme.
“It’s risky to do because it’s illegal and you can get arrested,” he said. “But I have to pay my child support or they’ll throw me in jail anyway. I haven’t missed a payment yet.”
The camp is just off the road in the woods amid a working class neighborhood. They keep a low profile and are not visible from the road, though Corbett had his bike stolen last week. He paid $60 for it, a day and half’s wages.
“I only had it two weeks,” Corbett, who sports an impressive handlebar mustache, said. “It was nice to be able to get around without having to walk everywhere.”
“But I was used to walking before, so it wasn’t too hard a change,” he added philosophically.
On the way back to the camp, Corbett finds a pan that someone has thrown out, which he says would make a good wok. He takes it back to camp.
There are three tents in the camp. Washing hangs on lines strung between trees and all the furniture they have – a table, cushions and crates to sit on – have been retrieved from dumpsters in the area.
Hawkins and Corbett have larger tents, while Everhart has a little one at the entrance on the path.
“I’m the guard dog,” he said with a grin. Everhart has a pony tail and is clean shaven, and like the other two he takes care of his appearance. “I’m the lightest sleeper so if anyone comes to the camp in the night I’ll hear them.”
Getting out of this camp and into a home is a long, hard to climb.
“If you want to get an apartment, you need deposits for rent and utilities as well as money for your first month’s bills,” Hawkins said. “You’re talking about $1,500 to $2,000 just to get started.”
“That’s tough when you make $40 a day,” he added.
Hawkins said that even though they are working whenever they can – he himself is limited in what he can do because he cannot stand for long periods on his prosthetic leg – prospective employers look down on them.
“They think you’re unreliable just doing day work,” he said. “They don’t see it for what it is, just doing everything you can to get by.”
All three men feel left behind. In their 40s, out of work and living in the woods, it is not hard to see why. Though Corbett is clearly an optimist.
“If we just keep working hard, things will turn out alright,” he said. “We’re not going to be out in the woods forever.”
CHARLOTTE, North Carolina – Well before the doors of the Urban Ministry Center open on Sunday mornings, there is a crowd of people, mostly men, milling around waiting for a meal the center provides for the homeless and the needy.
“This is actually a relatively quiet day for us,” said staff member Kathy Izard. “During the week we feed up to 400 people.”
Izard marshals volunteers with a friendly, but impressively efficient manner. It is clear that there is a premium on her time and she is making full use of her limited resources. Up to 10,000 volunteers a year donate time and food here. Izard spent years volunteering the kitchen.
“When you turn up you never know what food has been donated, so you just make something up on the spot,” she said. “So far we’ve never run out of food.”
Izard pauses to direct volunteers toward the kitchen and trains one on the spot on handing out mail.
“For many of the people we serve, this is their only address,” she explained. “If you don’t have an address, it’s hard to find work.”
Izard said that the center has been seeing people that they have never seen before, people who have never needed free food but have been left without jobs and homes as a result of America’s longest and deepest recession since the 1930s.
“A lot of the people we see coming through were on the margins before the downturn,” she said. “When the recession hit, it took away their safety net.”
“Most of those people never thought they’d end up here,” she added.
Paul McDougald, 37, is waiting for a shower. He used to work in a warehouse unloading and loading trucks, but has been out of work since May 2008 and now sleeps at a homeless shelter.
“I’ve been trying to find a job ever since, but there’s nothing out there,” he said. “It’s real stressful. Without this place I would be in real trouble.”
“Some day the Lord is going to help me out of this,” he added.
The doors open at 11:15am and people file in, lining up in an orderly fashion to receive the day’s meal. Served on plastic trays, today it consists of a small salad, a slice of roast beef, a bread roll, green beans and potatoes and a cupcake.
The meal is eaten in virtual silence. Few people feel much like talking here.
While tucking into his food, Charlie Edwards, 58, said that “bad financial choices and unreliable so-called friends” had brought him to this point.
Unable to find work in his profession – circuit board manufacturing – he said he does not see any way forward in Charlotte.
“Work in my specialty is pretty much non-existent right now,” Edwards said. “If I could find anything that would pay a tolerable wage, I’d take it.”
“But who’s going to hire a 58-year-old for a job when they can hire a young man?” he asked. “People are not too interested in training someone my age.”
Liz Clasen-Kelly, the Urban Ministry Center’s associate executive director, said that although statistics do not exist on the age of people who come through the door,many of them are middle-aged men who lose out to younger men when trying to get back into the job market.
She said that since 2007 the number of people coming for the free meals the center hands out has risen 21 percent and is still climbing. One silver lining for the center: While there are more mouths to feed, the number of volunteers turning up to help has also increased.
“There has always been a history of inequity in America,” she said. “But the housing crisis has shown many people that this could happen to their neighbors. That awareness has encouraged them to volunteer.”
“It’s not a national policy, it doesn’t solve the problem of homelessness in this country,” she said. “But every little bit helps and we’re grateful for the many individual acts of generosity we see.”