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Sunday, March 3, 2024

Elegy for a dying town

More than 300 more people will lose their jobs in Aberdeen in coming months as the town faces another episode in its history of abandonment.  Banner Engineering is closing its plant which had 311 employees.  Just a year ago, it expanded its Aberdeen plant.

The nation is experiencing a high point in the economy, but Aberdeen seems to be left out.

This is the latest in a series of major manufacturing companies closing down their operations in Aberdeen.  In the 1980s. Control Data shut down its Aberdeen plant with 1,340 employees to move the jobs to the Pacific Rim.  More recently, Molded Fiber Glass left town, joined by Hub City, Inc., which had been in town for 125 years.

The closure of Presentation College last summer marked a trend that community leaders don't want to talk about.  And they don't.  But it demonstrates a reality, which is a community in decline.  That decline is more evident in the retail sector which in recent years has had the closings of Kmart, Shopko, J. C. Penney, Herbergers, Sears, and Conlin's.  Aberdeen has lost its role as a shopping destination for the region. 

The most significant closing was Presentation College because it indicated that its  sponsors did not see a future in Aberdeen. In their statements on the closing, the leaders listed the demerits of the town as a  factor:  its remoteness was the major one cited. 

As the business editor for a newspaper, I covered many business changes, relocations, and closures.  Mergers and buyouts often signal an eventual closing.  Smaller companies which are merged or purchased by a larger one disappear into the corporate murk.  An example in South Dakota is the Gateway computer.  Once prominent in the midwest, it disappeared when the company moved to California.  Decisions to move or close a facility are often notional.  Executives decide to make a change for personal reasons or just because they have the power to do so.  Business reasons are often not good reasons.  They are a matter of executive choice.

A lot of executives have chosen to shut down their operations in Aberdeen.  Why Banner decided to abandon its operation here a year after expanding it is a matter of someone's choice.  Given the circumstances, it is difficult to understand how it could be the only rational choice.   

Someone or a group of someones decided to abandon a newly expanded plant and get rid of 311 people.  Corporations are not democracies.  They are dictatorships.  The people affected by their decisions cannot call them into account.  

Northern State University has a strong business department.  It cooperates closely with some business ventures.  It was involved in the EB-5 scandal  a few years back when some corporate magicians made millions of dollars disappear.  Although not primarily a research university, it is in a position to study the community which supports it.  While it can make nice with the businesses in the community, it can also exercise its academic function of examining how companies are going about their business.  Are they pursuing the good business practices taught in the classrooms?  Are they meeting the standards of competence and integrity that contribute to an honest democratic society?

And what happened to the people who have lost their jobs in recent years?  I recall when Control Data dumped its employees into the job market, many came to Northern to prepare for new careers.  But what has happened to the people let go by Molded Fiber Glass and Hub City?  What will happen to the people from Banner Engineering?

Economic development and business promotional people customarily suck up to and bow down to businesses to attract them and keep them in a community.  No one keeps a serious check on how the businesses are performing as corporate citizens.  And being a corporate citizen is a matter of how one contributes to and lives in the community. 

In a statement about its closing, Banner said, "We regret having to take this action and will work to provide the resources and tools to make this transition as successful as possible.”  From the business standpoint. a successful transition means getting out of town as fast and unobstructed as possible.  It doesn't mean having anything further to do with the community.

At this time, state officials are commenting on a shortage in the labor force.  Aberdeen will contribute 311 people to alleviate that shortage, but where will they gave to go and what will they have to do?  Finding a commensurate job in Aberdeen seems unlikely.

The city manager recently issued a glowing prospective on Aberdeen's outlook.  When asked about specific developments, the only thing he could cite is the upgrading of the waste water treatment plant.  Could some of those 300 people be hired for that job?  As a neighbor put it, dealing with more of Aberdeen's shit.

But at some point, Aberdeen leaders will have to face reality.  And reality can't be dispensed with by glowing predictions that do not address the facts.  


Bill Rosin said...

Economist Richard Wolff, democracy in the workplace…worker owned and operated corps!

Anonymous said...

It looks like one of the few long term large employers in Aberdeen, will be the Bureau of Indian Affairs. I wonder if Northern has looked into the importance of this employer and what it means for Aberdeen, if not, they should and publish their findings.

Miranda Gohn said...

I'd imagine selling hate, bigotry and intolerance really limits business and other opportunities for the state given the actions and rhetoric by those in the super majority party. Outside of MAGA world South Dakota has a horrible reputation and image in other states and possibly countries. I will share what two very moderate Minnesota Republican elected officials mentioned to me who are not into culture wars and all this toxic craziness later.

Now SD Universities are ending reciprocity with MN. Minnesota now offers free tuition at their public universities being income based.

Aberdeen is indeed in decline which is sad to see since I see so much potential to differentiate itself in a positive way but doubt that would most likely not happen given the political climate.

Will post more on this later but am once again grateful you are sharing a hard truth!

Miranda Gohn said...

If I remember correctly Litchfield, MN is short about 800 units for housing including apartments and single family homes. The employers offer good compensation packages but a large number of employees have to drive a distance for work and some positions go unfilled.

I pitched the idea of adapting the SD Governors House program to Minnesota. They could copy it exactly from South Dakota which Iowa did or make changes to it as they feel would be best for everyone affected and involved. The legislators I approached were in either my district or nearby being both DFL and MNGOP. The MNGOP legislators I spent the most time with that could drive this are moderate, well respected, liked on both sides of the aisle and are highly effective. They are not into dividing or demonizing people but focused on bringing people together to meet challenges. MN government was divided at the time prior to the DFL trifecta.

The one MNGOP legislator I drove to meet said it was a great idea but he has found that if there was a program that had originated in South Dakota that he previously tried to adapt in MN the DFL legislators automatically wanted nothing to do with it! He used one example in the area of tourism which would have cost Minnesota anything but it was killed immediately! He advised me that we would have to approach this differently and small on a county level as a pilot project with assistance from the state.

With so many native born South Dakotans that have had to reluctantly leave the state I would speculate their personal stories do not portray South Dakota in a positive manner due to the political climate and lack of economic and/or educational opportunities. Some rise up into positions of influence at work and in their communities. A few became Minnesota legislators with one DFLer I door knocked with in St. Cloud who was a peacemaker and very soft spoken. He chose not to run for re-election. Those highly effective legislators put in an enormous amount of hours. Another is serving now that grew up in Platte, SD.

Another moderate Republican who is an elected official being a semi-retired long serving public school teacher and coach mentioned to me that it is rough out there in South Dakota when he found out I was from there. As we went deeper into our conversation it was about the rhetoric, scandals, bills and laws that do not reflect very well for the state. It certainly was not about Democrats since they do not have any power there.

When we bring this back to Aberdeen all of this really limits opportunities to recruit and retain talent. It is self limiting being anti-business, anti-education, anti-opportunity and anti-Freedom. It should be we welcome all for maximum opportunities for everyone! We need to have those diverse perspectives and ideas rather than we are only looking for a certain type of people to live here. I believe the messaging and reputation of South Dakota has inflicted enormous opportunity costs which indirectly contributed to the closure of Presentation College as one example. You with past posts point to other factors in respect to Northern.

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