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The jobless face harsh choices a year after Electro-Motive shutdown

The pair struggled in the aftermath to provide for their young family with both parents out of work. At the time, Ms. Smith wasn't eligible for benefits because she was off on maternity leave caring for their youngest daughter when the plant was shut down.

Deborah Baic/The Globe and Mail

Find more of The Globe's coverage of the fallout from a factory shutdown at

They are flipping burgers or driving trucks, sorting the mail, going back to school or still searching for work.

And while the job market looks bleak, with many positions offering low pay on a casual or temporary basis, just 20 of the 465 unionized workers who lost their jobs a year ago – when Caterpillar Inc. shuttered Electro-Motive Diesel, a London, Ont., locomotive plant – have relocated.

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The reasons vary for staying put. Many workers have mortgages and kids and roots in the southwestern Ontario town. Others are wary of the cold weather and high living costs in far-off communities. Some are reticent because they think the West, too, for all its promise, is now set to fizzle. So they stay, many of them with the wrong skills or education to find good work locally.

The abrupt closing of the 64-year-old plant came after workers rejected the company's proposal to cut wages, which had been an average of $34 per hour, by up to 50 per cent. The situation garnered international press coverage and stoked a debate about the competitiveness of Ontario's manufacturing sector.

Caterpillar, which has gained a reputation for taking a hard line against unionized labour, moved much of the work being done in London to a plant in Muncie, Ind., where the rate for non-union workers was between $12 and $18.50. The company cited competitive pressures and an unsustainable cost structure at the Ontario plant as reasons for the closure.

A year later, the ripple effects continue to wash over the workers, their families, the community and beyond. Their stories raise questions about the efficiency and health of Canada's labour market. Even as some companies in the southwestern Ontario city are fretting about skills shortages, the local jobless rate remains high, at 9.1 per cent.

Close to 500 unionized workers lost their jobs last year, as well as several hundred non-unionized workers. Of the 463 tracked every month by the Canadian Auto Workers union, 251 had found work as of Feb. 1; of that, 207 were in full-time jobs, 26 in contract positions, eight in part-time work and 10 self-employed. Many are starting to feel the pinch now as severance payments and employment insurance run out.

A visit to the local job action centre illustrates the challenge. Most jobs on offer are out of town. Many are casual positions, and at much lower pay than what was made at EMD; a posting for call-centre agents, for example, offers $17.50 an hour; forklift operator, $15 an hour; cabinet maker, $14 to $20 an hour.

Brandy Damm, 36, has cobbled together some hours sorting mail at Canada Post. But it's casual work: She only knows in the morning whether she'll be working that afternoon. She has seen a steep drop in her living standards in the past year.

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"Day to day, I don't know what I'm doing. I have no idea what my day or week looks like," which makes long-term planning impossible, says the former welder. She used to take annual trips overseas, eat in restaurants every week and dream of retirement at age 55. Not any more.

Things have also been tough for Vince Gugliotta and his wife, who both lost their jobs at the plant last February. He tried going West, borrowing money for a flight to Calgary. But after just a few days, the job disappeared. He returned home and says he won't leave his family behind again.

But the picture is brighter for 160 former Caterpillar workers who landed work at a General Motors plant through a deal struck by the CAW.

For Wade Purdy, it means no commute and pay of $34 an hour, similar to what was available at EMD. "It's hard on the body. It's a tough job," he said. "But it is what it is, a job, and a good-paying job, and it gets me going to my pension." Mr. Purdy's nephew and son-in-law, who also worked at EMD, still don't have work.

While hundreds of manufacturing jobs have disappeared from the area in recent years, a function of growing competition and a high dollar, other opportunities are emerging. For example, Dr. Oetker is opening a pizza plant, while Columbia Sportwear, the jacket maker, is hiring.

"Like many communities, we're in an adjustment and redefining mode," said Robert Collins, director of work force development at London Economic Development, adding that some employers are having difficulty finding workers with technical skills in advanced manufacturing and project leaders in the tech sector.

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More than 9,000 factory jobs disappeared in the city between 2006 and 2009, the Conference Board of Canada estimates. Manufacturing is "on the road to recovery" in London, buoyed in part by a firmer U.S. auto sector, though employment in the sector remains more than a quarter below its 2003 peak. Economic growth is expected to stay below 2.5 per cent through 2017, it predicts.

There are also silver linings in the closure. For Andrew Lockie, head of the local United Way, the plant's closing spurred his agency to develop new ways of serving people, focusing on families, not just affected workers. An outpouring of donations showed how generous people can be. For Mr. Gugliotta, who is at truck-driving school and whose wife is set to appear on the TV show Dragon's Den, pitching a new business, this year is one of "opportunity."

Caterpillar may have moved on, shifting locomotive production to lower-cost centres . But back in London, more workers are also now setting their sights elsewhere.

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