Long Island Scrap Metal

March 26, 2009

Gershow Recycling Will Be Among the First
to See a Recovering Economy

New Car and Durable Good Purchases, Home Improvements
Will Be Leading Indicators

Kevin Gershowitz, President, Gershow Recycling, says his company will be one of the first to see economic conditions improving. He says that, when his scrap yards get busy again with junk cars, old stoves and scrap from home improvements, the economy will be on its way to recovering.

Gershow Recycling, which specializes in the recycling of steel and metal products, saw a significant drop-off in scrap metal being brought into its six Long Island area scrap yards since October, due to a decrease in the purchases of new cars, durable goods and scrap metal brought in by contractors.

"If people are not purchasing a new car, then an old car is not being taken off the road. If they are not purchasing new homes or making home improvements, then old appliances and scrap from copper wiring is not being generated,” said Mr. Gershowitz.

In fact, if there has been a trend, it has been that consumers are continuing to use older products. A recent study reported by Edmunds indicated that, in the month of February, 27% of those looking to buy a new car decided to purchase a used car instead. That figure rose from 16% in previous months. However, when an old car or truck stays on the road, it doesn’t make its way to a steel recycler like Gershow, and doesn’t help the auto industry in Detroit.

In response to the economic decline, Gershow, like most other businesses, has tightened its belt, and is closely scrutinizing its costs. Gershow could justify massive layoffs, but, unlike other companies on Long Island and across the nation, Gershow has not had one single layoff. Recognizing it has developed a skilled and extremely dedicated workforce, the Gershowitz family has decided to maintain a long-term, optimistic view of the global economy and has decided to continue to invest in its workforce.

"That is the difference between a corporate conglomerate, where employees are just numbers, and a family-owned enterprise, which keeps its employees local, along with its profits and investments,” said Mr. Gershowitz. "This continued investment will put us in a better position competitively when the economy recovers.”

"We have been in business for 45 years, so this is not our first recession,” Mr. Gershowitz continued. "The economy is very cyclic, especially in the steel recycling business. When people begin to buy new cars and new durable goods, and local contractors start to get busier when more people decide to purchase or do work on their homes and businesses, then we will be among the first to see the economy recovering.”

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