BY SHAWN PIATEK
The Tribune-Democrat
July 08, 2007 12:13 am
—
Morton Kaufman was holed up in his Southmont home on the night of July 19, 1977 – largely due to a powerful storm raging outside his door.
Kaufman knew the storm was strong. But until he received a phone call the next morning, he was not fully aware of the destruction wrought in the valley below.
“We had a terrible rainstorm the night before, but we didn’t have any problems in Southmont,” said Kaufman, who at the time owned Morton’s Shoes at 551 Main St. in downtown Johnstown.
“Someone called me the next morning and told me there was a flood,” he said. “I couldn’t believe it.”
Kaufman immediately set out to check on his shop, only to be stopped along Menoher Boulevard and forced to park at the Chapin Arch above Kernville.
After making the rest of the trip on foot, he realized he was among the luckier business owners in the downtown.
About a foot of water covered the main floor of his shop and he had no inventory kept in the basement. So he was able to reopen in just three weeks.
Others weren’t so lucky.
Every downtown business came to a complete standstill for weeks; for some, months.
Some businesses never came back at all.
“It was a tragedy, really,” Kaufman said. “There were cars through Penn Furniture’s window. People had a lot more problems than we did.”
Retail flushed
Downtown’s two major department stores, Glosser Bros. and Penn Traffic, sustained major losses as a result of the flooding. Both organizations faced the very difficult decision of whether to reopen.
Glosser Bros. took a huge hit, losing a “couple of million dollars,” according to Alvin Glosser, who was vice president of the company. The hardest-hit area of the store was the grocery department, which was located in the basement and was completely contaminated.
Even facing such a huge recovery, Glosser said his family quickly decided that it needed to reopen its landmark store.
“Our initial reaction was one of dismay,” said Glosser, who was on a business trip to New York when the flood occurred.
“Our thoughts turned to whether to reopen or close it, because at that time we were expanding our Gee Bee stores. We got together all the members of the family and we decided, and we were pretty unanimous, that we wanted to reopen the downtown store as fast as we could.”
Only a few days later, Penn Traffic announced that it would not be going forward with its downtown operation.
Paul Reitz, board chairman, cited declining sales and flood losses as the reason to close the doors at Penn Traffic.
The decision eliminated 400 jobs.
“Not only was it job loss, but there was a psychological impact, too,” said Bill Findley, a state workforce analyst who had been on the job for nearly nine years before the flood hit.
“This was a mainstay of the Johnstown central business district. It was sort of a ‘how could this not be there any more?’ type of thing,” said Findley, who retired on June 29.
“We can talk statistics, and statistics do in some ways portray the events. But I also think that there is that human side, that psychological side, that took a big hit.”
Downtown retailers already were battling competition from the Richland Mall in Richland Township before the flood hit.
While the flood didn’t cause the downfall of retail downtown, Glosser said, it hastened the exodus to the East Hills.
“We were closed for over a month,” Glosser said.
“The outlying shopping centers started to claim the business. With the free parking available up there and the longer hours they could be open, you could see what was happening. The downtown was starting to erode.”
The steel industry in Johnstown also was declining well before the flood.
Local steelmaking operations peaked in the late 1950s and were well into a downsizing trend before the flood added more problems, Findley said.
“The obvious conclusion is that it (the flood) made steelmakers take a look and make some hard decisions,” he said.
“Perhaps, at that point, the writing was on the wall, if it hadn’t been before then.”
Findley, given the nature of his position, chose to discuss the steelmaking industry as a whole in regard to the flood’s impact on the city’s economy.
But even he admitted that “steel industry” was synonymous with one company in Johnstown – Bethlehem Steel Co.
Bethlehem wasn’t just a big player in the local steel sector, it was the region’s dominant employer in 1977. It had about 12,000 workers, accounting for roughly 12.5 percent of the 96,000 jobs in Cambria and Somerset counties.
Herb Pfuhl, mayor of Johnstown at the time, admitted he was worried about the future of Bethlehem’s operations in Johnstown well before the flood hit.
“I was very much concerned,” Pfuhl said. “I had heard Bethlehem Steel was thinking things that weren’t too pleasing to me at that time, even before the flood.”
Bethlehem’s future in Johnstown was bolstered somewhat when it announced in 1976 that it would be investing nearly $100 million in environmental upgrades to its facilities here. A report in The Tribune-Democrat from that time said the company’s ability to maintain an employment level near 12,000 hinged on those efforts.
But the flood caused significant damages to Bethlehem’s operations. Some estimates had costs to the company reaching more than $50 million.
The company responded by cutting 4,000 jobs a month after the flood. Many people, including Pfuhl, thought Bethlehem used the tragedy to begin its exit from the region.
“It just seemed like the flood was the real excuse for leaving,” Pfuhl said.
Others saw the situation differently. In fact, some said a Johnstown native, Lewis Foy, who was chairman of the company at the time, was responsible for keeping jobs in town as a response to the flood.
Rep. John Murtha, D-Johnstown, categorized Bethlehem’s efforts to maintain operations following the flood as an act of good corporate citizenship.
“Lew Foy became convinced after listening to us and after doing some research that he would keep the place open,” Murtha recalled.
“The excuse would have been to close it down, because it was an old facility with inadequate equipment.”
Bethlehem’s relationship with the Johnstown region continued, in diminishing capacities, until 1992.
Before and after
From a purely economic standpoint, Findley said, Johnstown was as healthy as he can ever remember it being during the months leading up to the flood.
In May 1977, the unemployment rate for the Johnstown metropolitan statistical area stood at 5.3 percent.
That was down markedly from 1976, when the MSA had an average unemployment rate of 7.4 percent.
The flood wiped out what progress had been made during the first half of the year.
The average unemployment rate for the year finished at just more than 10 percent and only improved marginally to 9.8 percent in 1978.
“The unemployment rate here was in 6 percent to 7 percent levels for the most part during that decade,” Findley said. “For this area, we were really moving along right before the flood. There weren’t any major issues for the economy at that time in terms of setbacks. Pre-flood, in that era, was probably one of the better times of the ’70s.”
The flood had an unmistakable impact on the local economy, Findley said. Then in the early 1980s, recession hit the whole country and retarded Johnstown’s efforts to recover from the catastrophe.
That perfect storm of detrimental economic events led to Johnstown posting the highest unemployment rate in the nation – more than 25 percent – in 1983.
Even today, Findley said, some effects of the flood’s economic impact can be felt. However, as the region did after major floods in 1889 and 1936, Johnstown has come back.
In fact, when comparing the annual job averages for the region from then to now, the recovery appears to be complete. In 1977, the Johnstown MSA had 88,400 jobs, the same as the combined moving annual average for Cambria and Somerset counties through the first four months of this year.
“There’s a school of thought that in some aspects we’ll never fully recover from the flood,” Findley said. “Some things were lost and will never come back. I think for the most part, though, we have recovered, and in some ways have moved forward. The goal was at that point to build it bigger, better and stronger. I think that goal has been accomplished.”
He cited efforts to broaden the local economy.
“Perhaps the biggest difference I see in the economy between then and now is the diversification. We no longer have that dependency on the primary metals industry, on manufacturing. It’s so different now.”
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