“A Severe and Prolonged Hangover,” 1956–1957

Abstract

The 1955 production boom resulted in nearly a million unsold vehicles on dealers’ lots. As a result, automakers scaled back production, resulting in widespread, chronic layoffs for autoworkers. Supplemental Unemployment Benefits were of little help because the programs were not fully funded and most unemployed autoworkers did not meet eligibility requirements. Instead, they struggled to cobble together secondary support systems. Many autoworkers had gone into debt during flush times in 1955 and were now saddled with mortgages, rents, or installment payments without regular income. Detroit floundered while the national economy thrived. More accurately, Detroit's working-class residents suffered while wealthier Detroiters shared in the nation's prosperity. Federal officials and automakers blamed autoworkers, with their high wages and generous fringe benefits, for their predicament.