Even Those Not Hit Hard Are Feeling Impact of Recession
The recession hasn’t really touched auto parts warehouseman Jerry Mohler.
He’s had steady work and longer hours, as more people opt to repair their Volkswagens and Audis rather than buy new cars.
But Mohler is the first to admit that looks are deceiving. Even though he and his wife have a higher standard of living and a steadier income than during the downturn of a decade ago, this recession seems much, much worse.
“More people that I know have been affected by this, that and the other thing. It seems like it’s all around. (For me) it’s more of a mental recession,” said the 42-year-old man, who is trying to also make a go of it as a part-time real estate agent. “Southern California has been artificially propped up by huge deficits. We’ve had this drunken party, and now we’re all recovering from a hangover.”
Mohler and many others not directly affected by the recession confirm the results of a just-released Cal State Fullerton study: Although Orange County’s unemployment rate is lower than in the last recession, this downturn seems to have a much more greater impact on people’s perception of economic loss.
On his nightly commute home to his condominium in Laguna Hills, Mohler listens to news on the radio of buyouts, mergers and bankruptcies. He looks out his car window to see vacant spaces in strip shopping centers. His father and stepmother work in the aerospace and aircraft industries, and both wonder when they will be the next to be pink-slipped. And friends have seen the price of their homes fall to below their outstanding mortgage amounts.
“We’re pretty fortunate because we have not been affected,” Mohler said. “If you got a car, you’re not to sell it; you’re going to fix it. It’s deceiving. (My job) is like being a bankruptcy attorney. Business is great.”
Builder Keith Johnson, who co-founded the Fieldstone Co. in Newport Beach during the midst of the last recession, said his company could see signs that consumers were getting more cautious about buying a home in early 1989--more than a year before the recession officially began in July, 1990. Sure enough, home sales began to fall, he said.
“Consumer confidence has been low in both recessions,” said Johnson, 49. He added that in 1981 and 1982, “the pain was more concentrated” on those who sold big-ticket items such as homes or cars, where the purchaser has to take on a large debt.
Recently, Johnson said, he went to a conference of businessmen in all professions “and the common comment was that it’s hurting everyone.”
Even so, while this recession has all the elements of the 16-month downturn in 1981-82--layoffs, cutbacks, long unemployment lines--consumer confidence seems much lower. And some people wonder whether some of it is fueled by a constant barrage of pessimistic media reports.
“Most people are very, very cautious,” said J. Michael Johnson, 49, of Brea, a salesman who sells blank videotapes to distributors. The video business has generally done well, because renting a movie is a cheaper alternative to taking the family out for a night at the movies.
“They’re not spending money,” he added. “They’re doing nothing. . . . You look in the media and you kind of wonder. It’s all doom and gloom. If everyone believed there was going to be a recession, there’s going to be one.”
Still, other Orange County residents point to social problems--homelessness, crime, gangs--as proof that this downturn is not just perception.
“It’s a lot worse,” said Santa Ana resident Mary Jane Patton, 69, a retired registered nurse who lives on a pension. “You can make figures say what you want them to say. But a lot more people are having problems. Now we have the homeless. We didn’t have that in the 1980s. We didn’t have people on the streets, homeless.”
Patton, who grew up in Orange County and has lived in Santa Ana since 1959, said that this recession rivals even the Great Depression of the 1930s.
“Then we had homeless men riding the rails, as they called it,” she said. “They would go to hobo camps. But those were just men. Now we have homeless women and children. . . . I don’t see why they call this a recession. It’s a depression.”
Even those who have just entered the job market and have found employment see this downturn as worse than others. Stanton aerospace engineer Tony Tegtmeyer graduated from Iowa State University in Ames less than a year ago. When he was a teen-ager, his family was hit by the farm crisis of the early 1980s. And although he has a job at McDonnell Douglas in Huntington Beach working in the space station program, this downturn feels worse, perhaps because California has been hit so hard.
“There were 40 people in my graduating class in aerospace and only two or three of us got jobs,” said Tegtmeyer, 25. “In California, you see it all around you.”
Those who have been hit hard by this recession view it no more lightly. Dick Vander Meade started Carpetime in Santa Ana in 1966, but he cannot think of a period when business was tougher.
“We’ve gone through recessions, one after another, good and bad, but this is the worst I’ve seen it,” said Vander Meade, 62. “People just aren’t out buying. They aren’t even looking. . . . If it wasn’t for the referrals and we were just starting out, we’d be dead in the water.”
Vander Meade and his wife have had to draw from savings to get through the tough times. He has not had to lay off anyone, for their only employee is their son. And efforts to attract new business--they have remodeled their store and added more product lines--have not helped much.
“We’re more careful,” he said. “We don’t go out to dinner anymore. We’ve had to remodel parts of our home . . . but we’re just doing minor things to keep up our psyche so it’s not all gloom.”
Vander Meade also points elsewhere, to other more established businesses, where the recession has been more far-reaching and stagnant than any other in recent memory.
“You look at things you would have bet the family farm on--Bullock’s, the Broadway, the airlines--they’re all going out,” he said. “People look at that and don’t want to spend. They don’t know what’s ahead.”
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