In desperate 1983, there was nowhere for Pittsburgh's economy to go but up

A tide of change




Town by town, factory by factory, job by job. A tide of change.

-- A story from the Dec. 5, 1982 Pittsburgh Press, about the death of the century-old foundation of Pittsburgh's regional economy.


He was just 29, and already a 10-year veteran of the mills and the mines. That's what rugged young men living in this stretch of steel country did in those days. They left high school, got a job at the mill, married, fathered two kids and bought a house before the age of 30.

His name was Denny Bambino, a millwright and a welder, and his middle-class way of life was made possible by what our region had always been good at -- forging metal, mining coal, rolling tubes, making the world one ingot and I-beam at a time.

This life would not last. By 1982, Mr. Bambino had seen the writing on the wall many times over, in the form of transfers and layoff notices. A job at Bethlehem Steel's Franklin works, near Johnstown, disappeared after five years. A job at the company's rail car plant ended, too, as did his next mill job, in Steelton, near Harrisburg, where he was making $1,400 every two weeks.

It lasted just eight months. Next up was a job in a Cambria County coal mine with Barnes and Tucker Co., and it ended the same way.

By December 1982, he was perpetually unemployed, his wife was gone, his home was up for sale, and he'd moved back in with his parents. His unemployment benefits ran out the week before Christmas.


A tide of change

Our regional economy barely resembles the one from 30 years ago. A full generation has passed since January 1983, when the southwestern Pennsylvania economy was at its nadir and unemployment was at its all-time peak.

Monday: When Pittsburgh hit rock-bottom, the foundations were there to bail us out by learning to take a more hands-on approach to neighborhood and economic development.

Tuesday: While Pittsburgh has found a new identity, other spots around the region haven't been as lucky. Could the energy industry help those pockets, such as Beaver County, still suffering from the end of Big Steel?


"All of the sudden, everything started going downhill," he remembered, 30 years later and now living in Baltimore.

It couldn't get any worse. But it did, for one more month.

In January 1983, the regional economy officially -- that is, numerically -- bottomed out. Unemployment in Allegheny County hit 13.9 percent, a rosy figure compared to the rest of the Pittsburgh metropolitan statistical area, where the adjusted unemployment rate hit an astonishing 17.1 percent (unadjusted, the number was actually higher, 18.2 percent).

It had never been that high before, at least not since the government started counting, and it hasn't been that high since. Regionally, the number of unemployed hit 212,000.

In Armstrong County, where canal and railroad towns up and down the Allegheny and Kiski rivers were already fading, unemployment peaked at 19.5 percent. In industrialized Beaver County, the rate hit 27.1 percent in January 1983 -- greater than the peak U.S. unemployment rate during the Great Depression. In Johnstown's Cambria County, the rate topped 23 percent.

Time softens memories. Given the distance the regional economy has traveled during that intervening generation -- and given that so many young families pulled up stakes, never to return -- it's easy for those making a living here now to forget that what southwestern Pennsylvania endured was not a merely recession, not even a Great Recession.

This was a region hanging on by its fingernails.

• • •

The elegy for Pittsburgh's old way of life was being written, year by year, day by day, on the pages of the local papers. The city could not have realized it in the early 1970s, not as the region was still employing close to 300,000 in manufacturing trades. Few were that prescient -- and those few who saw what was coming were ignored.

But Jimmy Carter's malaise became Ronald Reagan's recession. As 1981 bled into a gory 1982, the headlines spoke to a permanent, shattering change to the regional economy, rather than a mere lull in the boom-bust industrial cycle that had long been familiar to Pittsburghers. By autumn of that year, the local economy was nearing the bottom of a slow, post-war whirlpool.

In October, the region's unemployment rate hit 15 percent. In November, the United Steelworkers union rejected a concession-laden contract offer, heightening the chance of shutdowns and bankruptcies at steel shops nationally.

In early December, U.S. Steel Corp. announced that it was postponing a promised upgrade to its Edgar Thomson plant in Braddock, and on the same day announced that it was shutting its Lorain, Ohio, works. By mid-month, workers at Weirton Steel were contemplating a 32 percent pay cut, and Roger Smith, the chairman of General Motors -- one of the biggest metals consumers in the world -- was warning that it would have to buy Japanese steel if the USW wouldn't back away from its nationwide strike threat.

PG graphic: Brief description
(Click image for larger version)

The day after Christmas, Bethlehem Steel Corp. announced it would cut 10,000 jobs nationally and 2,300 in Johnstown, where more than one in five people were already unemployed.

It's a Christmas that still haunts Johnstown, and for those who made a living in Big Steel and ancillary industries, the late 1970s and early 1980s are full of these sad calendar landmarks.

In Aliquippa, those with long memories recall the day in 1984 when LTV Corp. announced it would shutter its Aliquippa Works, laying off 8,000 employees. Eighteen miles downriver, in Midland, they remember summer of 1982, when Crucible Steel was idled, putting 4,000 on the jobless rolls.

But for the region, January 1983 stands alone as the nadir.

That was the month a young North Sider named Thomas J. Murphy Jr., whose father was employed at U.S. Steel's SouthSide Works, again would be sworn into state office, representing his newly redrawn state House district for the first time. A decade later, he would be elected the city's mayor.

"It was painful," he said. "My father worked at that mill for 51 years. He started at 12 years old, as a water boy ... It was hard to let go."

Yet by his third term in state office, it had dawned on Mr. Murphy -- if not all of his political cohorts and the local trade unions -- that "this was permanent. It was done. We needed to move on with our lives."

So much was lost -- not just jobs, but people. Pittsburgh had been shrinking since the 1950s, but between 1970 and 1990, the city proper lost a full 30 percent of its population. People left to find work, and those working-age citizens who stayed behind were feeling around in the dark, searching for jobs in an employment landscape they no longer recognized.

"We had people coming into our district office, looking for jobs," Mr. Murphy said. "They had nowhere to go."

One place they went, particularly if they lived in the hard-hit Monongahela Valley, was to the Braddock Employment & Training Center. Lena Franklin, 84, worked there then and she still works there now, in some cases finding employment for the sons and daughters of those desperate mill workers she was helping a generation ago.

Her organization found its purpose after surveying those in the Braddock area about what might reverse the decline -- more recreational opportunities? Storefront improvement?

The answer came back -- jobs.

"People were not interested in playgrounds," Ms. Franklin recalled. "They were interested in eating and living."

• • •

The unemployment rate came down after January 1983 -- slowly, painfully, not because people were returning to work here but because the young and able-bodied left the region, and thus its labor force.

Much of what wasn't disassembled by 1983 was already operating below capacity, and fell in the coming years. U.S. Steel's mills in Duquesne and Clairton closed in 1984; the Homestead works shuttered in 1986; followed by National Tube and American Bridge in 1987. By 1985, almost all of LTV's Aliquippa works was idled, as was the Southside Works. The next year, Wheeling-Pittsburgh closed its Monessen factory.

Business writer John Hoerr, born in McKeesport during the Depression, returned to these austere river banks again and again in researching his book, "And The Wolf Finally Came: The Decline and Fall of the American Steel Industry."

His first such research trip came in 1982.

"When I got there and drove up the valley to my hometown, [I] was amazed by how fast the valley had gone downhill in just a few months ... The valley seemed weirdly quiet. None of the banging and crashing sounds. No smoke in the sky, of course. I was just startled."

The Depression, as he recalled it, had hit the Tube City hard. There were months in the late 1930s when his dad's shop was one of the only open storefronts on Fifth Avenue.

But what happened to McKeesport 40 years later might have been worse. "At least the buildings were still standing in the Depression," he said.

In an eight-year span, from 1979 to 1987, the Pittsburgh region lost 133,000 manufacturing jobs. Some of those jobs vanished into obsolescence because new technologies led to improved productivity, and many more drifted overseas and into non-union mini-mills.

Diversification couldn't help -- U.S. Steel's 1982 acquisition of Marathon Oil, if anything, diminished the company's interest in metals. Government intervention couldn't help -- "lawmakers had bailed out the steel companies, [but] not steel mills," wrote John H. Hinshaw in his "Steel and Steelworkers."

Foreign steel was everywhere. By the end, Pittsburgh-based U.S. Steel -- the world's first billion-dollar company, at one time making two-thirds of the world's steel -- was trying to buy slabs and tubes from Britain, Italy and South Korea. Deindustrialization was happening across the country, but in few places were the forces of globalization felt so acutely -- and so abruptly -- as in Pittsburgh, 1982 and 1983.

The working factories were gone, becoming overnight relics. Then the relics were gone, too, knocked down to make way for new shopping centers, new housing, new business parks, new river parks, a new city.

When the next big recession came, in 2008, the Pittsburgh region was prepared, having already endured the worst.

• • •

But that's the thing about hitting rock bottom. Some towns and city neighborhoods bounced back. Others broke apart on impact.

"Well, that was that," crane operator Ed Buzinka said on his last day of work at a U.S. Steel Corp. structural mill in Homestead, where a shopping plaza now sits. The account comes from the 1992 book "Homestead: the Glory and Tragedy of an American Steel Town."

"It's over," he told the writer. "But I'll tell you what. It was a good run while it lasted."

It was not quite over, not for everyone. Not for Denny Bambino, who had spent his twenties learning to weld and passing his millwright test. He'd earned his rate, and he'd put that to use, even if it meant leaving home.

Leave home he did, and he's never been back. He moved to New York and worked at a foundry. He moved to the northern reaches of Pennsylvania. Finally, in 1996, he found good, steady work in Baltimore, as a maintenance tech millwright at Sparrows Point steel mill, once the largest integrated steel mill in the U.S. and one of the last to survive the industrial earthquake.

Until, that is, this year, when current owner RG Steel filed for bankruptcy protection. The mill was purchased by a liquidation firm, throwing the mill's 2,200 employees, including Mr. Bambino, out of work in June.

He just turned 59. It's too late for a career change. "Nobody wants to hire an old guy."

He's again searching for work -- this time, on the Internet -- but after 40 years in the business, Mr. Bambino and heavy industry may have finally parted ways. It was good run, while it lasted.

mobilehome - businessnews

Bill Toland: btoland@post-gazette.com or 412-263-2625. First Published December 23, 2012 5:00 AM


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