Los Angeles Facts

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Los Angeles

Los Angeles

Small Businesses Star in a Revival

Los Angeles built its fortune and developed its vast sprawl during World War II and afterwards. Boom times in the film industry, in shipping, oil drilling, manufacturing of airplanes, automobiles, and rubber, and the aerospace industry acted as a magnet for African Americans, immigrants from Mexico and Asia, and whites from the Midwest and South. As late as 1988, Los Angeles’ economy appeared recession-proof, but a short time later, California’s economy took a nosedive. The aerospace industry and real estate markets collapsed, and 200,000 jobs disappeared in Los Angeles County alone.

Economic difficulties and simmering racial hostilities in Los Angeles exploded shortly thereafter in the 1992 South Central riots, which left 54 people dead, more than 2,000 injured, and an estimated $1 billion of damage to more than 1,000 buildings.   After a slow start, a “bottom-up” strategy of economic redevelopment was developed to help the devastated areas: getting small and medium-sized businesses to rebuild vacant lots in low-income neighborhoods, attracting retail establishments (especially supermarkets), and creating networks of inner-city manufacturers to exchange business information.

It turned out that despite low wages and a shortage of a retail stores, South Central boasted a thriving manufacturing base in clothing, toys, furniture, metalworking, and plastics; hundreds of food production and biomedical companies were also in operation. New networks of these local businesses, brought together through trade councils, newsletters, and conferences, are now helping the city revive.