Back to Janesville

Falling out of the middle class, I learned, is not the same as having been poor all along, bruising people’s identity along with their standard of living. Job retraining, I found, was not always a panacea. And as the 2016 election cycle was bringing Donald Trump to the fore, I saw the kind of post-industrial distress that attracted voters elsewhere to his flavor of populism—even as Janesville remained a Democratic-leaning union town.

Now, seven years after my book, Janesville: An American Story, came out, as the rain clattered on my rental car, I wondered what lessons this place might yield about the United States’ economy and communities’ hopes in this starkly different time. If this small city in America’s heartland served as a handy microcosm of what happened during the recession of 2007 to 2009, what could it tell us about the kinds of jobs America has been spawning lately, the geography of industrial development, the expectations that Biden administration policies have infused in another election year among communities in which traditional industry has become merely a memory.

And what I learned this time is a reminder that, often, more than one thing can be true at once. This small city has a plucky, resilient streak, so I was not surprised to hear while I was back in town an overt pride in its considerable recovery. And yet, that is not its only trajectory. The present-day story of Janesville also illustrates U.S. manufacturing’s waning and, in particular, the difficulty of finding fresh uses for the vestiges of auto plants the country has abandoned.

Deindustrialization, diversification

The recovery is reflected in a few data points: Despite the economic blow, the city did not become a ghost town, its population of 63,000 when the assembly plant shut down having crept up by a couple of thousand people. The supply of jobs, the labor force and the share of the labor force that is working are all healthy now, mirroring the U.S. national picture.

Unemployment, which had soared above 13% in 2009, is negligible. In March, the month I returned, it was sitting at 3.7%, about the same as the Midwest overall and a smidgen lower than that month’s U.S. average.

What Janesville went through is classic deindustrialization, and manufacturing certainly has ebbed; it accounts for one job in six in Rock County, which includes Janesville—nearly 3,000 fewer than just before the assembly plant closed, even after some manufacturing has reappeared. Its identity as an automaking town ripped away, the local economy has become more diverse. As the county’s economic development manager for the past quarter-century, James Otterstein, told me, “It takes 20 to 30 employers to replace the vacancy created by the GM machine.” Some new businesses have arrived, including a Dollar General distribution center that drew thousands of applicants for about 500 advertised jobs when it opened several years ago. Some longtime businesses have grown. And along Main Street, fewer storefronts are vacant, with a block of historic brick structures now including a wine bar and a shop specializing in olive oils.

Amid this bright news are a few wrinkles. Almost none of the jobs added in town lately are unionized, so they lack the generous benefits – including days off for hunting season—that GM furnished. Wages are another matter. Even today, Otterstein estimates, fewer than a thousand people in town are earning around the $28 an hour that General Motors was paying back when the plant closed. And while wages have been rising recently, inflation has been tempering the practical value of such gains, the way it has around the country.

The replacement of good-pay jobs with lesser-pay jobs has not stirred much bitterness. As Stan Milam, a retired Janesville journalist who grew up the son of a GM’er, told me, enough time has passed that much of today’s workforce never was at the assembly plant. “They are more or less dealing with the present, and, if you can make $20 an hour, you’re okay,” Milam said. “Most of those people don’t know what ‘used to be’ was.”

A different tension involves a slight friction that has long existed between Janesville’s haves (their own livelihoods untouched by the end of automaking) concentrated in the city’s northern and eastern neighborhoods and its have-nots (whose middle-class lifestyles collapsed along with the assembly plant) living mostly in southern and western parts of town. The biggest new fact and symbol of this persistent friction is an ice arena and convention center just under construction where a Sears department store was torn down, along the commercial strip stretching north from downtown. To build it, the city is borrowing $17 million—a huge sum for a city with a budget of $128 million this year—blended with private donations and federal money that Wisconsin, like all states, received to help cope with a more recent blow: the pandemic’s economic effects. Wisconsin’s governor, Tony Evers, was at the ribbon cutting a few months ago and said the project “will bring unlimited opportunities to the Janesville area,” including crowds to watch a professional hockey team.

Still, Rich Gruber, a former Janesville City Council president, is among those who see this sports and convention center as controversial. The investment of so much public money on the north part of town stirs old resentments, especially when it’s been several years since the south end lost Pick ‘n Save, its only grocery store.

Even so, Gruber told me the community “is very robust, compared with how solemn and depressing it was in ’08, ’09, ’10.” Dennis Winters, the chief economist for Wisconsin’s Department of Workforce Development, told me he regards the city as a comeback story.

The plant-sized vacancy

So, this fairly upbeat scenario is one way of understanding what has been happening in Janesville. And yet there is the other reality: the GM-plant-sized vacancy on the south side of town. The last time I’d been in Janesville, before the coronavirus pandemic, bulldozers belonging to a company that had bought the GM property were lumbering across the site, razing the factory that had begun turning out Chevrolets on Valentine’s Day of 1923.

Community members could pick up old plant bricks the new owner, a St. Louis-based firm specializing in distressed industrial land, gave away as a souvenir of its storied past. Not long after I’d glimpsed the demolition, the company and the city government aligned in a vision for the vast tract’s rebirth as Centennial Industrial Park. Yet, five years after I’d last looked upon the site, there has been no rebirth.

The heartbreak is especially sharp among those old enough to have first-hand memories of ways the assembly plant used to order the city’s rhythms, with local radio news timed to shift changes, grocery prices pegged to GM raises, United Auto Workers Local 95 a reliable source of community fundraisers.

So, why, in this resilient little city that has managed to create new jobs, is the colossus of an old GM site—with its notable advantages of two railroad lines, ample electricity, and a road named for a legendary U.S. labor leader connecting the property to an Interstate highway—still idle?

Part of the answer is the sobering context. If you look at the fates of closed auto plants that have dotted the United States, finding new purposes for such huge tracts of land is usually hard and slow. And the geography of U.S. industrial investment has migrated, with the South and its anti-labor culture—no longer the upper Midwest, including Wisconsin—increasingly the heart of America’s manufacturing. Plus, new-fangled manufacturing seldom requires the scale of Janesville’s 250-acre GM site. “It’s going to be harder and harder to find someone to come to an old auto site,” said K. Venkatesh Prasad, senior vice president of research at the Center for Automotive Research in Michigan.

I asked Bruce Rasher to calculate for me the time that typically elapses between putting a shuttered auto site up for sale and someone buying it. The median turns out to be almost 6 ½ years. If anyone has a clear-eyed view of what it takes to reuse a closed American auto plant, Rasher is the person. Since 2011, he has been the redevelopment manager of something called the RACER Trust, an independent organization formed by a court after General Motors declared bankruptcy near the Great Recession’s end. RACER was handed responsibility for cleaning up and otherwise getting ready for redevelopment some 83 locations in 14 states that were idled as part of the bankruptcy. Janesville was not among them because, until 2015—seven years after production stopped—it remained in limbo with GM saying it might reopen if circumstances warranted.

Even with federal money paying for environmental clean-up of the RACER locations, Rasher told me, “It’s very difficult. There are a lot of obstacles to redevelopment.” Of the 83 locations, Rasher has found buyers over the years for 46 in full so far. To find those buyers, he has vetted about 30 prospects per location. According to the Center for Automotive Research, seven other auto plants—General Motors and Chrysler—shut down within months of Janesville. Eventually, these others have found new uses. The one that sat empty longest held its grand opening last fall as Georgia’s largest television and movie production studio—named Assembly Studios to echo its past as a GM assembly plant.

Janesville’s trajectory

Why has Janesville’s trajectory, so far, been different? It turns out that the barren site is at the crossroads of two disputes. One dispute involves environmental contaminants. Under the concrete cap where the plant stood, pollutants have been leaching for generations into the soil and the adjacent Rock River sediment, including metals from cars so defective while being made that they were tossed into a huge pit. Wisconsin’s environment agency has ruled that, as long as the concrete remains in place, the property has been decontaminated enough for new industrial uses. The city government, however, has its own, stricter rules that would require any business interested in developing the property to destroy the concrete slab and remove the toxins underneath—a deterrent to would-be developers choosing where to locate.

If one dispute revolves around pollution standards, the other is a dispute over hope – a debate over what future is good enough that is familiar in many deindustrialized communities. In Janesville, the dispute pits the site’s owner, Commercial Development Corporation (CDC), against the city government. Stephen Collins, CDC’s executive vice president, says the company has cooperated with the city, including paying for the study five years ago that relied on local architects and engineers to devise the Centennial Industrial Park plan. Since then, Collins said, the company has brought a handful of prospects to the city government, the most serious of which would have been a terminal to move shipping containers between different modes of transport. City planners never even put the proposal on their agenda.

“To say we haven’t brought anything forward is inaccurate,” Collins told me. Lahner, the city manager, has quite a different view. CDC, he contended, “is not invested in the outcomes of this project.” With unattractive proposals, disputed back taxes and fees, and rubble piles that make the site “look like crap,” the city manager told me, “Honestly I just think the property got sold to the wrong group.”

As Lahner sees things, the site’s industrial history does not need to dictate its destiny. Its future, he told me, could perhaps be a data center, with new homes and nice public spaces.

The city’s ambitions have been stoked, in part, by the economic policies of President Biden, now campaigning for reelection, who pushed through Congress laws to promote infrastructure and new technologies. Just this spring, the president visited another small Wisconsin city, about 60 miles east of Janesville, to announce the creation of an artificial intelligence data center by Microsoft—part of the White House’s “Investing in America” agenda.

The catch is, as new federal money has begun flowing from the recent federal laws to spur the economy, Janesville has not benefited. When the U.S. Commerce Department last October announced grants to 31 regional “tech hubs,” the larger Wisconsin cities of Madison and Milwaukee were on the list. Without a major research university or a large white-collar workforce, said Otterstein, the county economic development manager, Janesville was not eligible to apply. He sees billions of federal dollars from the 2022 CHIPS and Science Act flowing to Phoenix to expand the semiconductor industry there. “If the federal government would have stepped forward to say, ‘We are going to drive a chip manufacturer specifically to the upper Midwest and locations that are dormant industrial plants…,’” Otterstein said, “I’m not suggesting our property would have risen to the top, but at least we would have been in the conversation.”

So, what now? In the year since he arrived, Lahner has become the main mover behind an unusual act of local government: a plan to condemn the old GM site and buy it from its owner. If the city owned the property, he figures, it could draw upon state and federal money to finish the cleanup. In February, the city council voted to take the first steps, assessing the land’s value. No one knows yet what this plan would cost city taxpayers.

CDC has been buying and selling distressed, often-polluted industrial land for three decades—300 sites in all. Over the years, Collins said, he has found “the market decides what is going to happen.” In other words, he questions whether Lahner’s aspirations are realistic. Still, Collins told me, “If they want to pursue that, we don’t want to stand in the way, as long as they pay a fair price.”

Lahner acknowledges that his vision is going to be hard, long and expensive, requiring millions of dollars to remove the toxins and perhaps five to 10 years more for the site’s rebirth.

In the meantime, Janesville turns out to be a metaphor once again—this time for a moment when jobs have become plentiful. Yet, the centerpiece of the town’s industrial identity for nearly a century remains vacant and scarred.