Slump Creates a Sheetrock Ghost Town

Empire, Nev. — This mining town of 300 people clings like a burr to the back of the Black Rock Desert. For years, it was marked on state Highway 447 by a two-story sign reading, "Welcome to Nowhere."

On June 20, that tongue-in-cheek greeting will become a fact. Empire, Nev., will transform into a ghost town. An eight-foot chain-link fence crowned with barbed wire will seal off the 136-acre plot. Even the local ZIP Code, 89405, will be discontinued.

Christian Science Monitor | Getty Images The company-owned town of Empire, which is 100 miles north of Reno, has closed after 87 years when United States Gypsum Company halted its gypsum mine and wallboard manufacturing operations in January.

Many towns have been scarred by the recession, but Empire will be the first to completely disappear. For only a few days more it will remain the last intact example of an American icon: the company town.

Since 1948, the United States Gypsum Corporation (USG), which is the nation's largest drywall manufacturer, has held title to all of Empire: four dusty streets lined with cottonwoods, elms, and silver poplars, dozens of low-slung houses, a community hall, a swimming pool, a cracked tennis court, and a nine-hole golf course called Burning Sands. The company also owns the town's drywall plant and the nearby gypsum quarry, a 264-acre gouge in the foot of the Selenite mountain range six miles to the south.

The end of Empire began just before Christmas, when dozens of workers in steel-toed shoes and hard hats filed into the community hall for a mandatory 7:30 a.m. meeting. Mike Spihlman, the gypsum plant's soft-spoken manager, delivered the news to a room of stunned faces: Empire was shutting down. "I had to stand in front of 92 people and say 'Not only do you not have a job anymore, you don't have a house anymore,' " Mr. Spihlman recalled.

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[USG  Loading...      ()   ], known for its Sheetrock-brand products, has posted losses of about $1.5 billion over the past three years. The red ink is a result of "weak market conditions and extraordinarily low shipping volumes," former chief executive William C. Foote told investors in October. Beneath the jargon is a simpler story: What Empire makes is not in high demand anymore. The housing construction slump has continued too long for the plant to hold on. By the end of 2010, wallboard sales had dropped more than 50 percent since 2006, when the industry peaked and USG had $297 million in profits. Manufacturers are getting desperate now. On Nov. 3, USG announced plans to hike drywall prices the following month by 25 percent, a Hail Mary pass to stimulate profits. The move rippled across the industry as other wallboard manufacturers followed suit. (USG's price increase was later revised and rolled out in two installments: 20 percent in March and an additional 15 percent in May.)

"Every day we made it was a day closer to economic recovery. But [the recession] just outlasted us," says Steve Conley, who began working here in the early 1970s. He rose to become quarry foreman, the same title once held by his father, Bud, who retired in 1987 after 33 years of service. "I was born in a haul truck," the younger Mr. Conley jokes, adding more soberly: "This is my home."

Until January, the quarry was a noisy place. Blasts of ANFO, an explosive, punctuated the still mountain air, dislodging white, chalky chunks of ore from five terraced pits, the largest a half-mile across. A fleet of haul trucks shuttled 60-ton batches of gypsum six miles up the highway to the factory, where workers pulverized it, cooked it up past 500 degrees F. in massive kettles, and shaped it into the wallboard delivered for construction across the American West. Before the miners used trucks, they ferried 1,800-pound payloads along an aerial tram in colossal steel buckets, trailing blotches of spilled powder below.

By some accounts, the Empire facility – known here as "the gyp" – encompasses the longest continuously operating mine in the country. The mining claim, originally established by Pacific Portland Cement Co., dates to 1910.

Now the quarry is silent, its roads blocked off with gravel berms to discourage trespassers. The factory has been empty since Jan. 31. And Empire, a scrap of green in the desert, is already starting to fade. Lawns once immaculately tended are choked with weeds. A fence is rising around the perimeter. Residents say it makes Empire look like a "concentration camp." If someone doesn't find a new use for this place, the town will eventually vanish. When dust blows in from the desert, no one will be here to sweep it away. It will start erasing signs of human habitation in a place that has been settled since 1923, when miners established a tent city.

By the end of May, all but a handful of workers had already made the forced exodus. Before they left, many tossed their corporate hard hats high into the branches of a neighborhood tree, creating an impromptu monument to their lives here.