Ever since Kodak was founded, it has had a
key role in the Rochester community.

One reason is of course that Kodak became
by far the largest employer in the city.

One large employer like Kodak also implies
that hundreds of small firms sell their goods
and services to that company.

A third reason is that Kodak’s founder,
George Eastman, was highly involved
in the Rochester community.

His former residence, the Eastman House,
became a museum in 1949.

There are at least 30 organizations that were
either created or partly funded by Eastman.

The University of Rochester…

… The Eastman
School of Music
Student Living
Center…

… The Eastman Dental Center…

… It goes on and on, I think
you see my point.

George Eastman and his Kodak became the father of
each employee, and even to the city…

People in Rochester therefore refer to Kodak as
Rochester’s great yellow father.

In Rochester,
everyone had
some kind of
relation to Kodak.

If I had grown up in Rochester, my granddad would
have received his first paid vacation as a factory
worker at Kodak in 1938…

… Maybe dad went to the University of Rochester in
the 1970s, got a degree in engineering and started to
work for Kodak…

… Making a good living and a slow but
steady career at the company…

In Sweden I
joined the tennis
frenzy as a kid. If
I had grown up
in Rochester
instead, I would
probably have
ended up playing
baseball,
practicing in the
Kodak park…

In short, if you lived in Rochester, you could always
trust Kodak to provide you with a good life.

Art Aspengren (such a Swedish family name!), the
President of the Rochester Industrial Management
Council, said that “if there is such a thing as a
company town, this is a company town.''

But a town which
relies heavily on
one single
employer
becomes very
vulnerable to
change…

… And change comes, sooner or later.

Back in the 1980s change came in
the shape of Fujifilm.

Fuji’s products were highly competitive and became
a real threat to Kodak’s global hegemony.

The number
of Kodak
employees in
Rochester
peaked in
1982 when
more than
60 000 people
worked there.

Partly due to the increased competition, Kodak laid
off 9000 workers in Rochester back in 1986.

This must have been quite a shift for
people here. Up to this point a job at
Kodak had been a job for life.

But there was more to come…

Fuji was on the rise…

… and the price war continued
throughout the 1990s…

Kodak had to cut back on its
extensive charity program…

… and lay off even more people in Rochester…

The wild diversification activities in the 1980s
had put the company in a lot of debt…

… The heydays of leverage come and go…

… and
Kodak’s CFO
from 1994
and on, Harry
Kavetas,
worked hard
to clean up
this mess…

In 1997, Kodak fired 19 000 people and needless to
say, this affected Rochester badly.

Had the great yellow father turned into a great
greedy monster with no care for its employees?

… I wouldn’t think so. The economic
conditions were simply very different from the
ones back in the 1970s when Paul Simon
wrote the song Kodachrome…

… And even a multinational giant has to
adapt to those changes, unless it wants
to end up at the elephant graveyard.

While there have been quite a few
protests throughout the years, I suppose
most people in Rochester understand
that the times have changed…

… And that a smaller Kodak is better for
Rochester than no Kodak at all.

… Then came the digital avalanche which destroyed
Kodak’s highly profitable film revenues…
30
25
20
15
10
5
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Number of film and digital
cameras sold in the United States.

Thus, the layoffs have continued up until
now and today less than 10 000 people
work for Kodak in Rochester.

Hence, about 50 000 jobs were lost in Rochester in
the last 20 years. For a city with about 230 000
inhabitants it’s quite a big blow…

One mustn’t forget all jobs that were lost
at those companies which sold goods
and services to Kodak.

It would be strange if a city did not suffer
from such a structural change…

… But nevertheless, Rochester has done
reasonably well over these years and has not
ended up as a ghost town.

One reason is that Kodak’s decline has taken place
over a longer period of time.

Another reason
might be that
other large
employers like
Xerox have done
rather well…

The University of Rochester has grown and
become the largest employer in the city.

It seems that George Eastman’s donation
turned out to be a good long term
investment for the town.

Moreover, people can and do create their own jobs.

It seems that a city with a strong knowledge base
and a critical mass of inhabitants can sometimes
master big structural changes reasonably well.

While the great yellow days are fading away,
Rochester seems to live on.

Image attributions

Sources
The Enquirer
The LA Times
NY Times
Rochester timeline

Christian Sandström is a
PhD student at Chalmers
University of Technology in
Gothenburg, Sweden. He
writes and speaks about
disruptive innovation and
technological change.
www.christiansandstrom.org
christian.sandstrom at chalmers.se