When the recession came to Michigan, it did not create a sudden crisis as much as bring to a climax socio-economic trends that had been gathering for some years. In 1958 unemployment in Michigan reached a peak of 460,000 or 15.7 per cent of the labor force. There has since been some improvement, the latest figure, as of April 15th, being 300,000; but it is both significant and troublesome that, while so substantial a number of workers remain without jobs, the auto industry has meanwhile reached a point where it is producing the same number of cars per month as in 1957.
In human terms, what we have in major areas of Detroit begins to resemble an old-style depression. No one seriously expects the auto industry to rehire the thousands of laid-off men; nor does anyone propose any significant measure for creating jobs. On the surface things may be quiet and the casual stroller through the city might be struck by nothing more ominous than an unusual number of closed-up stores; but anyone who cares to probe beneath this surface can find plenty of human misery, plenty of bewilderment and desperation. Consider this one fact: between Dec. 1957 and Dec. 1958 the number receiving relief almost doubled in Michigan and more than doubled in the city of Detroit.
PROFESSOR WILLIAM HABER, an expert student of the Michigan economy, has suggested four reasons for the continued economic crisis:
• Shifts in defense spending from conventional weapons to missiles.
• Decentralization of the auto industry.
• Plant shutdowns.
The weapons revolution has, of course, struck a heavy blow at the Michigan economy, but this is a problem that does not arise from within the auto industry itself. So let me confine myself to the three that do.