Published by Mark

Closings And Cuttings Pose Challenge For Post-Bankruptcy Rebuilding

December 23, 2008 at 12:11 pm

Earlier this month, in my Indiana bankruptcy blogs, I’d written about some positive job developments I was seeing around the state of Indiana (see Indiana Bankruptcy Attorney Glimpses Good News In The Indiana Jobs Pipeline and It’s Holiday Time, With Glimmers Of Hope In Indiana Job Markets). Unfortunately, today’s update is not as positive. As a bankruptcy lawyer serving 38 counties in Indiana, my intense interest in the availability of jobs comes from the knowledge that steady income is the key to my clients being able to rebuild their financial lives as I help them work through the bankruptcy process and then emerge from bankruptcy.

Until now, most of the job layoff news has related to manufacturing. But a recent spate of news relates to other business areas. In health care, St. Vincent Hospital announced that it would be eliminating 50 to 60 jobs in its West 86th Street Indianapolis location. Clarian Health had previously announced plans to lay off salaried workers in order to reduce operating costs by 5%, and Midtown Community Mental Health Center, part of Wishard Health Services, is cutting twenty positions. Then, on a different front, Office Depot plans to close two stores in Indiana, one in Valparaiso, plus one of its five Indianapolis stores. DHL will lay off 180 workers at two locations in Indy. On the good news front, the Indiana Live Casino in Shelbyville is getting ready to hire another 350 workers.

In manufacturing, the mix of good and bad news continues, as axle maker Dexter announced it would be closing a plant in North Manchester, but at the same time expanding its plant in Albion north of Ft. Wayne. In Mishawaka. Most of the laid off workers of AM General’s Hummer plant were called back to work. Out of Lafayette, Indiana, the news was negative, with truck-trailer maker Wabash National extending its holiday shutdown, planning to keep 800 employees on layoff status after it resumes operations, and Suburu of Indiana Automotive reducing its production this month and next. Closings planned for next year include Dalton’s Kendallville foundry, Magna Powertrain in Howe, auto parts manufacturer Vibracoustic in Ligonier, and Friction Holdings in Crawfordsville and Greenwood.

I’ve often written in these bankruptcy blogs about the fact that job layoffs and medical expenses, along with divorce are the “Big Three’ factors in bankruptcy. Needless to say, job layoffs and loss of insurance coverage are closely related. “More and more families”, writes Connie Schultz in the Indianapolis Star,
“joined the ranks of the already 46 million uninsured.” In fact, by way of explaining St. Vincent Hospital’s decision to make job cuts, spokesman Johnny Smith (Indianapolis Star) noted “an increase in uncompensated care.”

Just a little more than a year ago, one of the attorneys that works in my bankruptcy law office said that the words she hears most often from clients who come into our office for the first time are “I never thought I’d be here!” With so many job layoffs and plant closings, I suspect we’ll be hearing those six words even more frequently. When what hardworking, responsible people thought could never happen, happens to them – the bankruptcy safety net is available to give them a chance for a fresh start.

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