The Downturn in Dalton

In Dalton, Georgia, about an hour and a half up I-75 from Atlanta, carpet is king. According to the town's mayor, David Pennington, 85-90 percent of the carpet made in America is manufactured in the Dalton area.

It was an industry that just a couple years ago was booming; growing so fast, carpet factory managers had a hard time finding enough workers to start new shifts.

Now, the days of virtual full employment are a fleeting memory in Dalton. Unemployment in the metro area reached 12.1 percent at last count, a full 4 points above the national average.

"The housing slump means houses aren't being built and carpet's not being sold. We're so heavily leaning on carpet in Dalton that any effect on the housing industry impacts the carpet industry negatively," says Georgia Department of Labor official Jerry Garland.

And it's not just the carpet industry in Dalton that's being hit. Small businesses in town, which are largely dependent on the foot traffic brought in by the big carpet companies, can't catch a break either.

Check out the video for more.