A Changing Economy: Opportunity Lost Amid Manufacturing Downturn
In the 1960s, the giant CF&I steel plant on the southern end of Pueblo was the economic driving engine and racial equalizer for Colorado’s southernmost major city.
Former Pueblo City Council President Ray Aguilera, in his early 20s during the mill’s last heyday as a large-scale employer, recalls wives dropping their husbands – Latinos, Italians Slovenians – at the tunnel entrance leading under the roadway to the 7,000 lucrative jobs on the other side. The work often did not require college degrees or even high school diplomas.
“Why would anybody want to go college when you can go out to the mill and make (today’s equivalent of) $60,000, $70,000 a year,” Aguilera said.
The towering steel mill stacks and their billowing clouds of smoke were symbols of a unique prosperity, one in which the smelter was a melting pot in more ways than one.
When the city’s soldiers, sailors and Marines returned from War World II, they all expected a fair shake from Pueblo’s major employer. Soon, the mill’s segregated showers for whites and Latinos disappeared.
“So in 1945, things began to change even in the mill, CF&I,” Aguilera said. “(Latinos) began to get good jobs. This was the beginning of the transformation of Pueblo, this convergence.
“I thought Pueblo was Shangri-la. It was a period of prosperity for all these guys that worked in the mill.”
CF&I churned 24-7, with workers from each of the three shifts piling into Gus’s or another neighborhood bar for a shot and a beer before heading home.
High wages and generous overtime led to Latino families buying homes, sometimes even cabins and boats for family vacations, said former state Sen. Abel Tapia, a Pueblo native.
One in five Pueblo workers held manufacturing jobs in 1970, according to Census data.
Two-thirds of Pueblo County’s Latino households owned their own homes in 1970, according to an I-News analysis of six decades of U.S. Census data. Latino families, on average, earned more than 80 percent of the countywide average that same year.
“It was a life to go for,” Tapia said. “Then all of a sudden, it kind of went away.”
By 1982, manufacturing operations in Pueblo and across the United States were hit by stiff international competition that led to drastic cutbacks and factory closures. CF&I went from 13,000 jobs statewide, including all of its subsidiaries, to eventually 1,300 at its bottom in the 1990s.
Pueblo certainly wasn’t the only steel town in the U.S. to be rocked by change. But when the Colorado Fuel and Iron plant drastically downsized, Pueblo became emblematic in Colorado of the state’s economy pivoting away from heavy manufacturing.
For a large segment of the state’s minority population, it was as if the pathway to the middle class had disappeared.
An I-News analysis of Census Data from 1960-2010 tracked important measures of social progress –family income, poverty rates, high school and college graduation, and home ownership –among Colorado’s whites, blacks and Latinos. The study found widening disparities in more recent decades.
Progress made by minorities in the 1960s and 1970s faded in most every measure. One reason why: The state’s economic landscape shifted precipitously away from good paying blue-collar jobs.
“It was terrible,” Aguilera said. “The thought of losing all those jobs and closing this plant was absolutely a nightmare, the way the community felt.”
Said Tapia, who himself was laid off by C&FI where he had worked as a college-educated engineer, “We’re about 50 percent Hispanic here. It hit us very hard.”
The downturn in manufacturing hurt minority workers disproportionately in Colorado and across the U.S. It is one of the reasons cited by researchers for the widening gaps with white workers on key economic and educational measures.
I-News found that Colorado was a more equitable state than the national average in the first of the decennial studies covered by the analysis, but that the state’s disparities were greater than the national average in more recent decades.
“In a way, Colorado was by virtue of its older economy a more equal place than the rest of the United States,” said Alan Berube, research director for the Brookings Institution’s Metropolitan Policy Program. “But it’s just picked up in droves these elements of the national economy and it’s now more like a caricature of the United States in terms of the imbalance between the high end and the low end –where the high end is disproportionately employing highly educated whites and the low is probably employing disproportionately, less educated Latinos and African Americans.”
I-News found that manufacturing jobs in Colorado fell from 14 percent of all jobs in the state in 1970 to 7.5 percent of all jobs in 2010
The analysis also found Latino workers in Colorado were heavily impacted. In 1970, one in four Latino workers in Colorado had a manufacturing job. Today, it is less than one in 10. The lost manufacturing jobs have not been replaced by similar paying jobs accessible to those without college degrees.
One in seven black workers held manufacturing jobs in 1980 and only one in 15 held similar jobs in 2010.
The Gates Rubber Co., which employed 5,500 workers in the 1950s and 1960s, closed its Denver manufacturing facility in 1991. Samsonite, the luggage manufacturer, had 4,000 workers at its peak in the 1960s and 1970s at its Montbello facility. When it closed in 2001 it was down to 340 employees.
IBM changed from a manufacturing operation in Boulder County to a white-collar data center.
Colorado’s changing employment profile saw a rise in retail, tourism and health care jobs as the number of manufacturing jobs fell. CF&I, Gates and Samsonite have been replaced by companies such as Lockheed Martin, Western Union and Level 3.
The changing economic and political environment also took its toll on federal government jobs, another major source of employment for minority workers during the civil rights era in part as a result of affirmative action policies.
Those jobs have also dwindled in scope over the past four decades.
Former Denver Mayor Wellington Webb said all presidential administrations since Reagan have emphasized shrinking the size of the federal government.
“Frankly, that trend continued under Bush, under Clinton, under Bush and under Obama,” Webb said. “Each one is proud of talking about how they’ve shrunk the size of federal government.”
With the shrinking came less focus on affirmative action, Webb said.
The intent and thrust of affirmative action, as envisioned by President John F. Kennedy in an executive order in 1961 and strengthened and expanded by President Lyndon B. Johnson in 1965, has clearly been diminished with passing decades.
The U.S. Supreme Court has ruled that affirmative action for minorities is unfair if it leads to reverse discrimination against the majority. Some states, including California, voted to ban affirmative action programs. However, Colorado voters rejected such a ban in 2008.
Colorado has one of the largest federal workforces among the states. In total federal payroll, it ranks No. 8. Yet, federal jobs fell from 5.8 percent of all jobs in the state to 3.2 percent between 1970 and 2010. For black workers, the jobs dropped even more dramatically - from 15 percent of all jobs held by African Americans in the state to 6 percent.
The percent of the Latino work force in federal jobs in Colorado has gone up and down between 1970 and 2010.
It is another example of the changing job profile of Colorado that has had a major impact on the Latino and black work force.
In 1970, one in four black workers either was employed in manufacturing or by the federal government. By 2010, that had dropped to one in eight.
Among Latino workers, more than one in three held manufacturing or federal government jobs in 1970. That had fallen to fewer than one in four by 2010.
As the manufacturing jobs dwindled in Pueblo, the gaps between the county’s Latino and white residents widened.
Tapia and Aguilera said decades of not needing college or even high school degrees to get good paying manufacturing jobs came home to roost when the steel mill jobs disappeared.
Generations grew up thinking a college education was not necessary, Aguilera said.
“A lot of it was their dad didn’t graduate, so they weren’t graduating,” Tapia said.
Many fathers wanted their daughters to stay home and raise families, rather than go to college, added Aguilera.
Consequently, the city has had to deal with a devastating high school drop-out rate.
In 1994, a letter to the editor from a high school senior at Central High published in the Pueblo Chieftain brought the problem home. She wrote that she had 390 classmates in her freshman year and now two weeks from graduation only 187 remained.
“We were the ones stunned,” Aguilera recalled. “We had no idea. What happened to all of those kids?”
Teenage pregnancies in Pueblo rose to among the highest rates in Colorado, almost double the state rate.
“We have babies raising babies,” Aguilera said. The predominately Latino part of the city had the highest rate in Colorado of grandparents raising grandchildren.
As the decades went by, Latino median family incomes fell to 65 percent of white incomes. Home ownership rates fell to 58 percent and poverty hit more than one out of every four Latinos in the county.
“People up north used to say they’d hate to be in Pueblo because you got that big ugly steel mill,” said Tapia. “Well, the people that raised a family didn’t think it was big and ugly. They thought it was great and then it went away.”
“That is so scary,” said Ray Kogovsek, former Congressman from Pueblo. “Right now the system isn’t working.”
For more information: inewsnetwork.org. Contact Burt Hubbard at firstname.lastname@example.org or 303-446-4931. This report was made possible, in part, by grants from The Colorado Health Foundation and the French-American Foundation