The Job-Loss Butterfly Effect: From Peoria To Vegas Job losses at a Caterpillar plant in Illinois are impacting workers in nearby towns and far away cities. As a result, tightened spending is putting the pinch on businesses large and small alike as workers readjust their spending habits and priorities.
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The Job-Loss Butterfly Effect: From Peoria To Vegas

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The Job-Loss Butterfly Effect: From Peoria To Vegas

The Job-Loss Butterfly Effect: From Peoria To Vegas

The Job-Loss Butterfly Effect: From Peoria To Vegas

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

News travels fast, but business travels faster. In good times, one new job can help create another one across the country, and in tough economic times like these, job losses reverberate throughout the economy and remind us how connected we are.

Take last week's layoffs at Caterpillar: 33-year-old Tina Bajic worked at Cat's Mossville, Ill., plant, polishing truck crankshafts on the third shift, making about $30,000 a year. On Thursday night, she went to work and her supervisor delivered the bad news.

"He said this is about the hardest thing he's ever had to do, but this will be the last time we'll be working and 'actually you're laid off as of right now so collect your things and meet me at the door to turn in your badge,' and that was about it," Bajic says. "I have three boys, so they depend on me. I'm trying not to worry about it."

But she is a single mother, and the Caterpillar layoffs are gong to hit her household twice.

"My older son's father — he worked at Cat, too. He's getting laid of too, and he pays child support, so I don't know what I'm going to be getting when he gets laid off. So that's going to affect me," she says.

For now, it'll be unemployment checks and belt-tightening.

"I'll have to find ways to cut spending, I guess," Bajic says. "Not eat out as much — that's for sure. It's also disappointing because my car's not doing real good right now."

Bajic says she would have bought a new car, but that will have to wait.

Ripple Effects Of Decreased Spending

Tammie Cox of nearby Peoria just lost two jobs, which she says earned her about $30,000 a year — neither of them at Caterpillar, but both of them indirectly dependent on the company.

At one job she tracked Caterpillar parts.

"I was employed just recently through DHL Global Forwarding, but because of Caterpillar, they had to lay off employees," she says.

Cox also waited tables at a Mossville restaurant and bar that depended on Caterpillar workers — a place called Building G.

"The Caterpillar workers use to, if they wanted to go have a beer or a get-together with their friends, they would say that there was a meeting at Building G," she says.

Cox says that after a promising start last summer, the restaurant found that Caterpillar workers were cutting back, and business at Building G slowed to a halt.

Just as the recession has claimed her restaurant job, her being out of work threatens jobs at businesses that she patronizes.

"I don't go out shopping anymore; I don't go get my hair done like I used to every so many weeks," she says. But her hairdresser, she says, is probably leaving town anyway.

Hotels And Resorts Feel The Pinch

There's another thing Cox may have to give up now that her jobs have disappeared.

"I shoot pool a lot in different leagues, and we were all getting ready because in May we go to Vegas for the national tournament," she says. "In 1997, I was women's national eight-ball champ, but now I'm not sure if I'm going to be able to go in May because of having to pay for a flight. I usually use my income taxes, but now I've got to worry about the bills being paid before I can justify going to Vegas."

So Cox could be a scratch for the tournament at the Riviera Resort. If she passes up a trip this year, she will hardly be the only missing customer at the Riviera.

"It has been challenging," says Phil Simmons, the Riviera's chief financial officer. "It's tough for us — it's a destination resort out here and people are reluctant to get on the plane and travel to Las Vegas these days."

That's evident in Riviera's stock, which hasn't been faring so well. Down from a high of $24.40 a share, it's now trading for less than $4 a share.

The Riviera has also been renovating its rooms, but last year, to save a few million dollars, it stopped work on the last tower that was due for a makeover. And the hotel laid off workers.

"I think we're consistent with other gaming companies in town as far as layoffs go, but we've definitely pared down the workforce," Simmons says. "We have had to cut labor, which is our largest expense, to offset substantial revenue declines."

With resorts like the Riviera laying off and cutting back on contracting for the renovation project, Las Vegas, which has been one of the fastest growing cities in the country, is taking a hit.

One symptom of the city's troubles is the housing market: Las Vegas is one of the hardest hit places in America when it comes to foreclosures. And it's hard to see how folks there can pay the mortgage or the rent, if people like Cox in Peoria don't come to play pool and if people like Bajic don't go out for supper in Mossville.