Quitting Time: A Factory's Fall, A Neighborhood's Fallout

The morning of Monday, Jan. 22, 2007, brought mixed news for Pfizer Inc., the multinational pharmaceutical giant. Revenue in the previous quarter, the company announced, was flat from a year earlier, at $12.6 billion. Earnings per share were up but only factoring in the one-time windfall from the company's sale of its consumer health care business. Otherwise, profit was down, and analysts were worried.

In the competitive drug industry, the company's future was uncertain: Viagra, a Pfizer product, was losing market share to rival erectile dysfunction drugs, and the patent for the heart drug Lipitor, a Pfizer standard-bearer and one of the most popular medications in the world, was set to expire in a few years. Cheaper generics would soon be cutting into sales, and Pfizer had just halted development on a planned replacement for the heart drug after trials linked that new medication to an increased death rate.

The company's earnings announcement came paired with a tough proposed remedy: In a move to save $2 billion a year, Pfizer would close research sites in Japan, France and Michigan. It would sell a factory in Germany and close one in Omaha, Neb. In all, the job cuts would total 10,000 worldwide—including 600 at one other shuttered factory: In a move that shocked workers at a facility that had only recently been featured in a prominent Pfizer ad campaign, the company announced it was closing its plant in Brooklyn, a 600,000-square-foot brick hulk on Flushing Avenue—the site where Pfizer was founded in 1849.

For much of its century and a half in Brooklyn, Pfizer was just one of the industrial powerhouses that moved the borough's economy—a blue-collar bastion that included shipbuilding and auto parts manufacturing plants, chemical producers, breweries and, less than two miles northwest of Pfizer, the Domino Sugar refinery. By the time the Domino facility closed in 2004, leaving its last 200 or so workers jobless, the Pfizer plant—operating with a fraction of the workers it had employed just a few years earlier— was one of the borough's only remaining traces of big industry.

At the time, reactions to the Pfizer closing were mixed, a mélange of resignation, anger over the lost jobs and respect for the company's long history in Brooklyn. Laid-off employees told the newspapers they had been expecting cuts but were nonetheless surprised to see them come. Community leaders praised the company for the good it had done in the neighborhood, including building low-income housing and financing a charter school in one of the company's vacant buildings. As for the jobs, they said, the losses would hurt. But even so, there was an upside: At least the economy was good.

Four years later, the charter school is still there. A gravel lot next door, former Pfizer land, is strewn with half-deflated rubber balls, in pink, purple and yellow, that have escaped over a playground fence. The low-income housing survives as well—tidy rows of townhouses just across a parking lot from the old factory, immediately east of the city's sprawling Marcy Houses public housing complex. Even the 1940s-era factory building itself is there, in a state of suspended animation, its guardhouse empty, its entrances clogged with piles of dry leaves.

What is gone are the jobs, from Pfizer, Domino and most of the rest of industrial Brooklyn. From 1997 to 2007, according to a City Limits analysis of census data, the number of people employed in manufacturing nationwide dropped 20 percent. In New York State, the decline was 31 percent. Brooklyn was hit even harder: In 2007, more than 20,000 fewer people in the borough were working in manufacturing than were a decade earlier—a drop of 46 percent.

Experts doubt that the numbers will ever rebound. The question, then, is whether those good jobs can be replaced and what will occupy the physical space that Pfizer has left behind.

* * * * *

Magno Shaw, a 51-year-old immigrant from Panama who lives near the plant, once thought about getting a job there or at one of the area's other factories. But, he says passing by the vast empty parking lot north of Flushing Avenue on a chilly winter day, the hiring process was long, and soon it was too late. Now he commutes to work at a hotel in Manhattan. The neighborhood, he says, feels the plant's absence.

"Around this time, they used to have their parties for employees, all that stuff," he says. "The parking lot used to be full of people, cars. Right now it's just an empty space."

For a while, he recalls, there had been talk of a supermarket. Soon after the close, Pfizer officials told The New York Times they would work with the city to develop housing and commercial space.

"Then nothing happened," Shaw says, "and you know, that was it."

The hole that industry left in the borough was a long time in the making. Jerry Krase, a professor emeritus of sociology at Brooklyn College, says the fall of the New York factory began citywide in the 1970s, with heavy industry. Manufacturing from New York moved first to the Southeastern states and then farther south to Mexico and elsewhere overseas, he says, with chemical plants, textile mills and assembly plants following a decade later. Krase recalls a friend who ran a shop making ambulances near the Gowanus Canal—importing trucks from Detroit and retrofitting them. "His business, I think, moved down to Georgia," Krase says. "He went down to consult with them for a while."

At the time, some observers welcomed the shift away from manufacturing, arguing that pay in the sector was low and the work was dirty and dangerous. Better, the argument went, to see people employed in the more modern fields like health care, technology and entertainment.

These are the sectors that have grown in Brooklyn in recent years, and none more than health care, which saw a $5.9 million increase in payroll in the borough from 1997 to 2007. The number of Brooklyn residents working in the field grew 371 percent during that period. Growth was also substantial in educational services and in arts, entertainment and recreation.

In terms of raw jobs gained—roughly 200,000—those increases make up for the manufacturing losses nearly 10 times over. But, Krase argues, the number of raw jobs tells only a small part of the story. For example, even though the medical industry pays well on average, that average is skewed, he argues, by the salaries of a small number of employees: doctors. Middle-income medical workers, meanwhile, might make less than middle-income workers in a unionized factory.

"What you're talking about is somebody who was working as a welder, or in an electrical factory," Krase says. "They would have been making a good, solid middle income. And that job, other than totally disappearing or being no job at all, is somebody who is now working at Kings County Hospital, or at some senior citizens' place as an aide, or at a bank or insurance company doing some kind of clerical work. And those are not good jobs."

Similarly, he adds, many households' source of income has shifted from one family member to another as manufacturing jobs, traditionally held by men, have disappeared. The jobs that replaced them are so-called pink-collar jobs traditionally held by women—jobs that also traditionally pay less.

As for the original wage earners, he says, "The point is, there is no equivalent. There is no equivalent wellpaying job for someone who is not particularly well educated or skilled. There may be jobs there, but they're not jobs where it's possible to make a good living."

* * * * *

In the Marcy Houses, some residents say the Pfizer closing didn't affect as many people as the site's proximity might suggest.

"When the factory was open, to get a job in there, it was a who-you-know type of thing," says one resident, Salimah A. Malik, walking down Marcy Avenue between the complex and the factory building one afternoon. The problem, she says, is what has replaced the factory: nothing. "Now it's becoming an eyesore—the weeds are coming up, whatever the case may be. Mother Nature's doing what she do. The thing is, now what do we do with the space?"

Malik, for one, would like to see the Pfizer site used for housing that is affordable to the working poor and to older people receiving Social Security; Section 8 housing in the area, she says, is too hard for many people to get into. At the same time, the streets around the factory, in a border zone south of Williamsburg and north of Bedford-Stuyvesant, are in increased demand for residential development.

Part of the area's rise in rents is the residual effect of new construction during the boom years of the past decade—a boom during which the number of Brooklyn residents working in real estate, incidentally, nearly tripled. One new building, across Flushing Avenue from the Marcy Houses, calls itself the Platinum Condos, with a banner outside advertising studio apartments in the $200,000 range, one-bedroom units more than $300,000 and two- and three-bedroom units for upwards of half a million dollars. (Whether there have been buyers is unclear. A representative from the Real Estate Group, which was marketing some units in the building, said it is no longer involved with the project, and a spokeswoman for the Corcoran Group, which was marketing others, said they had all been temporarily taken off the market.)

Pressure is also coming from one community in which demand for real estate is still high: the Satmar sect of Hasidic Jews from nearby South Williamsburg. The Hasidic population's growth in the area has overtaken much of the formerly industrial land north of the Pfizer site and brought its members and the Marcy Houses' predominantly black residents physically closer than ever before.

"I'm Muslim," Malik quips, "so I tell my friends I live in the West Bank."

Naomi Colon, president of the tenants' association of Marcy Houses, says her group has had no contact with leaders of the Hasidic community. But, she adds, there are tensions, because many Marcy residents believe they are improperly prevented from renting affordable apartments in predominantly Jewish buildings. Combined with the rising cost of market-rate apartments, she says, this leaves residents feeling stuck in the projects. Faced with the increased competition for local resources, some are philosophical. "If you're not going to take care of your shit, someone else will," says James Young, who is walking his dogs in a Marcy courtyard one afternoon.

But, Colon says, one result of scarce housing is that many of the 1,700-plus families in the complex are now crowding more people into their apartments—a move that is against the rules but to which there is no alternative. She can tell people are doubling up, she says, because the complex generates more trash that it used to, and units seem to use more electricity.

She hopes the Pfizer site can be used for housing, she says, and that it is housing available to everyone. "There's a lot of families here that's living with their children, grandchildren, their husband and wife and other family," Colon says. "That's how it is. But it's not like they're not trying to find apartments. It's hard."

* * * * *

Building housing on the Pfizer property is no simple solution to the area's crowding, in part because the company and local officials are at an impasse. Though company officials mentioned the possibility of new housing early on, the site is still zoned for manufacturing use—a designation that would require an action of the City Council and the support of many others in the community and in local government to change. Whether that support would be forthcoming from manufacturing advocates, community leaders or anyone else is uncertain. And while many officials support housing—most notably the powerful State Assembly member Vito Lopez—they do not necessarily agree with Pfizer on the terms.

Complicating matters further, many in government were outraged that the company announced the plant's closing less than four years after accepting $46 million in city tax breaks aimed at job development. That deal was frozen before Pfizer collected the full amount, and in December the city's Industrial Development Authority announced the company had paid back the city $24.7 million—twice the sum it had originally received. Still, in the view of some officials who support housing, Pfizer should pay a steep price to be able to develop the land. Lopez says in an interview that he still wants affordable housing to be built on the site, with Pfizer and the city, state and federal governments subsidizing apartments for households making between $40,000 and $60,000 a year. Without guarantees about the nature of the housing, he says, he is not inclined to support a rezoning that could raise the value of the site several times over.

And in 2008, in a move aimed in part at pressuring the company to make a deal, Lopez introduced a bill to seize the property by eminent domain. Though the bill stalled initially, Lopez says he plans to reintroduce it this year. City Council member Steve Levin, who represents part of the site and who was once Lopez's chief of staff, blames the company for the stalemate.

"Pfizer would rather sit on that vacant property and wait for the economy to come back so they can hold on to that plan of doing luxury condos there," he says. "Pfizer should give the property away for a dollar, is what they should do. They don't need the money."

Christopher Loder, a Pfizer spokesman, says that in 2007 the company sought proposals and community input for the site, with an emphasis on "core principles" such as affordable housing, job creation and participation by female- and minority-owned businesses. The economic downturn, he says, prevented the company from completing the process.

"We notified community stakeholders in early 2009 that while the properties would remain on the market, our proactive marketing efforts would be suspended as we waited for the market to strengthen," Loder wrote in an e-mail.

"Though it is clear that the financial and real estate markets are still extremely challenging, we continue to be open to conversations regarding potential development of these properties and our commitment to our community-based development principles is unchanged," he added. "We remain dedicated to making the best decisions possible for a neighborhood we have proudly been part of for more than 150 years."

Notably, what the leading proposals for the site do not include is more industry. Though Levin laments the passing of an era when thousands of North Brooklyn residents could walk to work at well-paying, attainable manufacturing jobs, he calls the idea of replacing the lost Pfizer jobs "an awfully tall order," adding, "It's not something that looks very possible."

There is also the question of whether residents want industry next to them. In an interview for the Brooklyn Historical Society, a former Pfizer employee named Roslyn Sheer recalled fielding complaints from the plant's neighbors about its smell. "It was like old garbage," she said of one odor that came and went with the seasons.

Colon, from the residents' association, says jobs would be welcome, but not at any cost.

"We have to be careful, because remember—Pfizer, when I was a child, didn't have a cap on that chimney of theirs," she says. "A lot of us, including myself, caught bronchitis and asthma."

Though they have no proof it made them sick, she says, the presence of the smell and the smokestack left many residents wary of industry.

Levin argues that residential construction—of a certain kind, anyway—would be a way to address the problems of local working-class people from a different angle.

"The way that I look at it is, there's always going to be a need for affordable housing, especially in North Brooklyn," Levin says. "One thing we certainly don't need any more of is luxury condominiums. We've got plenty of them. It's a question of keeping the working classes of this city in the city. Whether it's a place for them to live or a place for them to work, they're both valuable and necessary." Still, some manufacturing advocates have mulled the idea of repurposing the main Pfizer factory building for light industry. The Greenpoint Manufacturing and Design Center, which has four buildings totaling more than 600,000 square feet of industrial space around Brooklyn, developed a plan to retrofit the facility in 2008, in response to Pfizer's request for proposals. The plan would have subdivided the old factory building into units ranging from 3,000 to 50,000 square feet and brought in a development partner to build affordable housing on the former parking lot and other vacant land around the site. The idea, which would have doubled the organization's square footage, fizzled when Pfizer delayed plans to sell the property.

Looking back, Paul Parkhill, the center's director of planning and development, says the idea's failure may have been a blessing in disguise.

"What was palatable to the neighborhood at large and what was achievable financially was kind of a big open question," Parkhill says. Between the smaller number of tenants available in a tight economy and the scarcity of loans available for large-scale projects, he says, "it would have been a very heavy lift."

In short, he says, today's Brooklyn may not have a demand for that much industrial space. And, though Pfizer has never put it in these terms, he says he can understand why the company might simply prefer to sell.

"We've noticed this in a lot of instances," Parkhill says, "where an industrial business that owns a building will choose to cash out because the value of the real estate exceeds the value of the business."

* * * * *

Are, then, Brooklyn's days of producing things nearing an end? Not necessarily, says Parkhill, who believes the area still has some natural advantages over other parts of the country and the world. First, he says, there is the area's large and diverse workforce, with plentiful skilled and unskilled labor. Even more important, there is its proximity to market: its location at the heart of an enormous population center, with minimal shipping required to reach millions of potential buyers. Whether the company is Greenpoint's Acme Smoked Fish or Bushwick's Supreme Poly Products—makers of plastic bags—there are reasons Brooklyn makes sense as a location for the scores of small manufacturers that remain. And, Parkhill says, the city can do even more to keep industry, through tax breaks, development incentives and lending programs. The natural advantages are, of course, some of the same advantages that made Brooklyn an industrial powerhouse in the first place, before a decline that began decades ago and has not abated.

At the Marcy Houses, Naomi Colon says she has seen the heartache that results when young people finish college, look for a job and have to return to the projects because nothing is available. As for their younger siblings, she says, there is not much work to be had in the neighborhood.

"We have a Duane Reade on the corner of Myrtle and Nostrand," Colon says. "We have a Family Dollar across the street, and I think a couple of young people from here work there. Key Food all the way up the block, some girls work there." Krase, of Brooklyn College, argues that New York City has always come out of recessions well because of its versatile economy, with real estate and financial services existing alongside manufacturing. The borough still has the workers and infrastructure, he says; it is the balance between sectors that has become skewed. In a healthy local economy, when one sector weakens, others can pick up the slack. Without diversity, cities become too reliant on the employers that they have and suffer when those employers fail.

Many in the city, Krase says, did not realize soon enough what harm the departure of factories could do.

"There was this euphoria of gentrification and all these new industries that were going to develop, which just didn't happen and didn't make sense even," Krase says. "How long can you sustain an economy based on retail?"