Local: And thus, the recession hits the River City
Two breaking news items of interest to those who want to be able to buy food and shelter for themselves and their families: ‘Mitsubishi announces 7-week non-production shutdown‘and ‘Cat contract workers facing cuts.’
One of the agencies that’s losing all that work with Caterpillar is ATS. Some of the People I worked with at SVI Media (before it moved all it’s jobs to the Philippines) ended up going to ATS. I was happy for them when I found out, because working for a Cat contractor is considered the next best thing to working for Cat. Not so much as it turns out.
I’m not enough of an economist (I’m not one at ALL, actually) to comment on whether Cat really has to do this, or if the company is just panicking like everyone else is.
But the loss of all these paychecks in Central Illinois cannot help but to put a crimp on other local businesses, leading to more lost jobs, which in turn causes more lost jobs. Eventually, someone will figure otu that now is the time to invest, money will start to flow, people will get hired, money will be spent in stores all will be right with the world.
Until then, I’m gonna hoard sugar and flour and bury my money in a mason jar in the backyard.
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December 5th, 2008 at 3:30 pm
Geez…you worked at SVI? I worked there for about 5 minutes. The smut peddling on demand movie rental place, right?
I heard through an inside source that ATS lost 32 contract employees. Some will be absorbed back into the company, some will be laid off.
December 5th, 2008 at 3:54 pm
What I’ve gleaned from forum postings at peoria.com is that Cat has told employees they will cut nearly all contract positions and then start cutting their own workforce. The problem with cutting many of these contract positions is that the positions are not redundant within Cat, and Cat employees will need to be retrained to fill the roles, like how office workers filled line positions during the last strike.
Volt, which comprised most, if not all, of the helpdesk positions in East Peoria, has lost its contract for first-level support. That contract now belongs to Satyam, which will be filling it with a call center in India. Here’s a direct example of dollars fleeing Central Illinois and being thrown at a second-rate replacement overseas. The “Trough” buzzword permeates all of Cat’s communications at the moment and is the impetus for this short-sighted cost-cutting, at the cost of the level of service to its customers, and in the case of the helpdesk, to its own employees. Meanwhile, good people here will be struggling to keep food on the table. Way to go, Cat. Furthermore, Big Yellow won’t be penalized by paying unemployment for cutting these positions. That will fall on the contract agencies.
I’m a contract employee at Cat and am currently sweating out an announcement for our division. Looks like there won’t be a Christmas for a lot of families around here.
December 5th, 2008 at 4:31 pm
Its too bad about Mitsubishi I had family that was laid off during the big lay offs a few years back and some that were fortunate to stay on, hopefully this will all end soon. I’m with you and my extra dollars are gonna be stuffed in my mattress though, knowing my luck I’d forget where I buried my money and have to tear up my whole yard. : )
Good luck to all the families out there!
December 5th, 2008 at 4:47 pm
I knew THIS would, eventually, happen! And, CAT’s still the engine that powers the Peoria area. What annoys Me most is how Peoria’s, so-called, civic leaders kept boasting far and wide about how insulated our economy was from the national recession. Absurd! Now, what will they say?
December 5th, 2008 at 6:38 pm
Geez, Peoria, ya think you might be pushing the panic button just a little early? Regardless, what does Cat layoffs have to do with our civic leaders? They have no control over this…
December 5th, 2008 at 8:40 pm
Forget the flour and sugar, beans and rice are where it is at!
December 5th, 2008 at 10:20 pm
Didn’t you notice last week when it was reported that Keystone would be closed for several weeks or so because of the bad business climate. The recession hit Peoria then. One person or even a few pounding their blog keyboards will never take the place of newspapers. It will take an army of you working in united effort to replace the printed word.
December 5th, 2008 at 10:34 pm
Ed: I suppose I should be flattered that you consider my lack of comment on one particular news event is somehow a failure on my part. It’s like you consider Peoria Pundit to be the “blog of record” for the Peoria area. Alas, I have a full time job doing something completely unrelated to blogging or journalism. On one hand, you seem to imply you rely on the blogs for your news, but on the other you scoff at the idea. Tell you want, make a HUGE donation via my PayPal button and I’ll take six months off work and blog like a maniac.
So thanks for the input.
December 6th, 2008 at 1:02 am
Diane Vespa,
As usual, You’ve jumped to conclusions! I didn’t say Peoria’s leaders had control over layoffs. Nor, am I panicking. I’m not being laid off! So, Why should I panic? I’m, just, not naive enough to believe that the Peoria area is insulated from the current recession! Peoria’s civic leaders (ex: the Convention and Visitor’s Bureau and the EDC amongst others) have been, recently, touting THIS area as unaffected by the national recession. That wasn’t only incorrect, but tactless considering the crisis situation the rest of the country’s misfortunes.
U.S. economists and historical lessons have revealed that economic ” boom and bust ” cycles, continuously, begin on the East and West coasts and move inward. The Midwest region has, finally, begun to experience the crippling effects of the global recession. Peoria’s economy is not immune considering that many of our local companies, including CAT, have global ties. And, if You’ve been following the business and national news (ex: CNN, CNBC, MSNBC, ETC.) THIS recession is global.
Stating the obvious (ex: construction stoppages, unemployment surges, plant and retail closures, massive real estate foreclosures, etc.) is Your idea of panic? As a business ” professional ” , I’m surprised that YOU aren’t more aware of changing economic conditions that affect your industry. Perhaps, You’re just hoping to make another ” killing ” in the (subprime) housing market?
December 6th, 2008 at 9:27 am
Oh brother. Talk about jumping to conclusions. Your conclusion- jumping was just masterful. Thanks for the explanation of your earlier comment, though.
December 6th, 2008 at 12:23 pm
(laughter) ” You’re Welcome! “
December 6th, 2008 at 11:59 pm
More examples of Peoria (civic) leader’s delusions…
http://www.pjstar.com/business/x1775422317/Gordon-Downturn-hitting-home
December 7th, 2008 at 3:02 pm
Anyone hear anything about E.P. outside vendors ? getting the ax?