In this modern era of big business, it is no longer front-page news when a major company cuts 10,000 jobs and declares bankruptcy. When we hear tales of mismanagement, we can't help but conjure up images of crooked CEOs who care only about their mansions and golf games, while leaving the hard-working individuals broke and unemployed.
The story with Consolidated Freightways runs a little deeper, as their immediate shutdown and bankruptcy left nearly 350 Buffalo natives, and 15,500 people throughout the country, jobless. When we look at where they went wrong, corruption is where the head immediately turns but it is far from the only answer.
Despite being the third most successful freight company in the United States, Con Freight showed losses for the last two years. The top two companies, meanwhile, turned profits. A recent change of management sought to turn the tide in Con Freight's favor, but fell short. The result was the company's recent filing for bankruptcy and decision to close - and padlock - offices nationwide.
The loss of a major trucking industry means a few things for the economy, especially in the already strapped city of Buffalo. Many local businesses will suffer slight losses and it will be harder for all Buffalo companies to export their goods. Con Freight, in particular, is an interesting example because of its organization. The company had hundreds of workers across the country both driving trucks and running hubs where the freight is actually consolidated. As a result, when the company closed, almost every state had cities that took a hit.
For Buffalo, it's also difficult because the jobs being lost are decent paying union jobs in the terminal, as well as truck drivers. These jobs, if replaced, will most likely be taken by non-union companies that will pay employees lower wages and give fewer benefits. The workers losing their jobs in Buffalo are losing them through no fault of their own, and they're losing them during an economic downturn when finding a new job will be difficult and will almost surely be at a lower salary.
The termination of so many employees at once will not increase their chances of finding employment, either. After their 39 weeks of unemployment benefits run out, they will be on their own with no help from the company or the government. The company is seeking government help to pay workers for the last two weeks, since it is unable to.
The workers were not given six weeks' notice, although they have said the bankruptcy filing was not unexpected. Some reported receiving a phone call Monday morning bearing the unhappy news, while others showed up to work only to find the gates locked shut. The company will mail letters to the employees explaining the action. That, however, is a case of too little, too late. Despite the lack of notice, suing the company would be useless; the bankruptcy filing has seen to that.
Companies are forgetting their responsibilities to the communities in which their workforce is based. They willingly gut a community for a few extra dollars in their pockets. Once they realize and accept that what they do has repercussions for everyone surrounding them, our economy can stabilize and businesses can return to making money, and making money stay in the hands of the honest workers.
