Where should employees of these cities go to remain employed?
Darien, Conn., may be the hardest hit by the current financial crisis, according to a list compiled by BusinessWeek magazine and demographics company TRF PolicyMap. Also expected to suffer the most from the nation’s financial woes are Bloomington, Ill.; Hoboken, N.J.; West Demoines, Iowa, and Garden City, N.Y.
The list ranked the communities by the percentage of the population working in real estate, finance, insurance and leasing in 2007. Cities considered in the study are those with at least 20,000 residents. Darien, Conn., had the highest share of their population in those industries – 27.23 percent.
The risk posed by the crisis threatens residents with the loss of their jobs, forcing many to relocate to other areas. Moving to New York and New Jersey could result in stiffer competition in the job market, lower compensation and periods of career and company adjustment. Prashant Gopal’s report also mentioned three communities with less diversified industries, though the report lacked insight and centered more on the list’s top cities.
Unlike financial portfolios, industrial diversification is obviously more difficult to alter in keeping up with the economy. When economies of agglomeration have developed, it will take a long time to adjust to new industries and attract the best skilled workers. These cities are on the brink of losing their workers if the crisis further escalates.
As the country’s center for credit card companies, Wilmington stands to be highly affected with the financial slump. Major banks and credit card companies have headquartered their credit card activities in Delaware’s largest city, including Bank of America, ING Direct, Chase, American Express, Citibank NA, Mastercard International and Merchant Bank, to name a few. The city also has a number of insurance firms and retail banks that list a huge client base in the area.
Charlotte, North Carolina
CNN.com chose this city as one of the “Best Places to Live and Launch” in 2008. As a financial powerhouse with Bank of America, Wachovia, Lending Tree, State Farm, American Community Bank, Blue Ridge Savings, First National, First Federal Savings, Carolina Trust, Cabarrus Bank, Bank of Stanly, Piedmont Bank, etc., Charlotte resists any financial shock that could dampen down its economy. Though it is believed that a national bank panic is still far from happening, the vulnerability of its financial workers to the crisis is seriously feared by analysts.
Starting this weekend, Charlotte will be in the national spotlight. Charlotte’s economic shaky ground will be featured in Friday evening’s CBS Evening News with Katie Couric. As well as being spotlighted in an upcoming 60 minutes episode where Leslie Stahl reports on the city’s financial institutions.
Sioux Falls, South Dakota
In addition to some credit unions, many financial companies have their headquarters in this small South Dakota city, including Citibank SD, Wells Fargo Financial Bank, Western Surety Company, Ana-Fam Inc., Cash Depot Inc., First Premier Bank, First National Bank and Total Card, Inc.
Bankcard, HSBC and Capital Card Services have also wide operations in the area. Back-office operations employ workers in the areas of credit card processing, student loan applications, risk management and other financial services. A large percentage of Sioux Falls residents rely on finance companies for their livelihood.
Since the property market has been in hot water since last year, it may very well affect these cities’ employment rates. To create a solid industrial base, policymakers and regional planners must be able to create support industries to withstand shocks or at least minimize a crisis’ effects in the labor market. Workers concentrated in these single-industry dominated cities can also acquire training in other sectors to improve their chances of moving to emerging industries.