The Company Town by Hardy Green

The Company Town by Hardy Green

My last blog post on company towns started me on a path to reading The Company Town by Hardy Green and a more in-depth look at one company town In Chocolate We Trust by Peter Kurie. Both were very interesting glimpses into the history and development of the company town. Kurie’s focused solely on Hershey, Pennsylvania, home to the great Hershey candy company. Green dove into a variety of company towns from early coal mines to textile mills.

Company Town: one business exerts a Big Brother like grip over the population controlling or even taking the place of government, collecting rents on company-owned housing, dictating buying habits (possibly at the company store), even administering where people worship and how they may spend their leisure time

Green asserts that “company towns are un-American and they are the essence of America.” America was built on a free market idea, where companies would compete for business, but the company town was one business exerting total control over all aspects of life in a community. Oftentimes though, the company is what created the community in the first place.

The creation of the community was usually out of necessity. A company would move to a remote location, near the resource needed for their good, and would then have to build the infrastructure to support a large workforce to extract the material or manufacture the product. When locating in or nearby an existing city many companies fought against building the infrastructure to support their new workforce. U.S. Steel was adamant they would not get into the business of building a town. They thought they “could simply lay out the grid, supply a sewer system and gas lines, and let the community take care of the actual residential construction. Before long though, the corporation was driven to build many residences, since undeveloped lots weren’t selling particularly well and home building hadn’t taken off.” They eventually spent $22 million on playgrounds, schools, gardens, clubs, and a visiting nurse program. They even funded sports teams and a Boy Scouts troop. Their change in attitude was out of necessity at first, needing to supply housing for their workforce, but they learned that building a sense of pride and company loyalty among workers and positive feelings towards their company among the public at large was important.

Mr. Cannon had to build houses, because the people coming in from farms to work in the mills had to have a place to live. They were broke. They didn’t even dream about building houses.

Other companies like Phelps Dodge started out with a commitment to the community. They built hundreds of housing units, a pool, playground, baseball diamond, and 52 bed hospital for the town of Morenci. They were committed at a time in the 1950s when companies were trying to divest themselves of their civic role. But their good will was not always good. The neighborhoods built by Phelps were segregated by race and the company owned everything from the bakery to the utilities. The company superintendent was even responsible for hiring teachers and serving as the town mayor.

The worst form of the company towns were the early coal towns. They coal companies built bare bones housing that were “slums as soon as they were occupied.” The miners were trapped in the town, constantly in debt to their employers who owned the company store supplying food, the housing, lighting, medical treatment centers, fuel and water. Most miners never earned enough to leave and saw their paychecks vanish each month.

Today’s largest companies are versions of the early company town in disguise, often called the corporate campus. One example many overlook is Disney World which uses underground tunnels that acts like its own small city. The underground town of Disney includes everything a worker could need including a cafeteria, dry cleaning, hair salon, and places to lay down and rest. Others are less obvious, but still function like an early company town. Googleplex in Mountain View, CA functions in such a way that employees would never need to leave. The difference between the early company town and the corporate towns of today are that employees do not see their paycheck’s dwindle to nothing because most of the amenities are job perks, not charged for through their salary.

The problem with the company towns today is they provide for too much on their corporate campus which is often located outside cities in a suburban environment. The location creates an isolated community discouraging visitors and unplanned, informal encounters. The only people the employees interact with are other employees. Here in Omaha, ConAgra has a inward focused campus. They moved into downtown, demolishing all the historic buildings and replacing them with modern brick structures that have little glass, curved streets that discourage anyone from entering that does not have a reason to be there, and a park for employees. The company moved to the perfect location for the modern employee lifestyle, but still created an isolated suburban campus.

More companies today are realizing the value of location. Amazon made it clear their second headquarters would be in a walkable, transit focused community. Companies today need to locate where the talent lives, not near raw materials or resources like companies of the past. The next generation of talent does not want to drive 30 minutes or more to a corporate campus in the suburbs. They want to be mixed into a community, within walking distances to bars and restaurants for lunch and happy hours. One trait of company towns that has not changed however, is their impact on housing. Large companies see demand for housing created by their growth and while they may not be building housing like the companies of the early 1900s, they are starting to contribute to solving the problem.

By 1916, a thousand companies were providing housing for 60,000 employees (3% of the US population)

There are lesson’s to be learned—both good and bad—from the original company towns. They have a role to play in the communities they occupy beyond the bottom line. While it is no longer relevant for them to exert a Big Brother influence on the community and its residents, they should continue their philanthropic missions to create better environments for not just their workforce but the residents as well. They should understand the true impacts they have when starting and expanding their business and set aside funding to mitigate any negative effects. Many companies have already started this effort, but plenty are behind.

Our Towns by James and Deborah Fallows

Our Towns by James and Deborah Fallows