If the shoe fits . . .

Connolly Shoe Co. starts as way to keep people employed, ends by putting 185 out of jobs

(Photo Courtesy of Washington County Historical Society)

During the first part of the 20th Century, Stillwater’s lumber industry started to decline, resulting in an unusually high unemployment rate in the area. To combat this problem, 24 Stillwater retail merchants decided to form a shoe company, enticing the production manager from the prison shoe shop to manage their new enterprise. The manager’s name was Thomas F. Connolly.

The merchants invested a total of $150,000 to begin the operation of the Connolly Shoe Co. The company was founded in September 1905 at 123 N. Second St. in Stillwater. Production began in 1906 with sales of $196,407.03. Although profits that year were less than $4,000, the company put 25 men to work.

The main types of shoes Connolly’s first produced were work boots and shoes. The company’s main concentration of sales was west of the Mississippi River.  Within three years, Connolly began producing a dress shoe, but emphasis remained on work shoes and boots.

In 1915, John Schadegg joined the company as a timekeeper. He worked his way up the ladder and in 1918, was made paymaster and put in charge of factory specifications. Later that year, he was called into military service and served in France until the end of World War I.

From 1919 to 1927, Schadegg developed and maintained production lines. But the onset of the Great Depression drove many companies out of business and Connolly Shoes struggled until 1931.

In 1931, with the U.S. deep into the Depression, Connolly Shoes almost met its end, but another group formed, reorganized the company and selected former sales manager Charles Englin as president.

Under Englin, sales rose from $604,000 in 1935 to more than $1.5 million in 1953. From 1931 to 1950, the company made exclusively kid and kangaroo shoes, with the exception of 1942, when they made 85,000 pairs of brown oxfords for the U.S. Army. With a total production capacity of 170,000 pairs of shoes, the Army contract made up half of the company’s orders that year.

By 1950, Connolly Shoe Co.’s owners sensed demand dropping for conservative styles of kid and kangaroo shoes, and decided to get back into more stylish dress shoes. They did not, however, abandon kid and kangaroo leathers that had always been well thought of for their soft comfort and tough wear qualities.

In 1953, John Schadegg, a Connolly Shoe Co. veteran of almost 40 years, became its president. Under his guidance, the sales rose to nearly $2 million.

In 1958, an investment group started gathering funds to buy the company. In 1963, the takeover occurred and O. Walter Johnson was installed as executive vice president, with Schadegg staying on as president.

One of the first new lines new management introduced were sport shoes, including a line of quality golf shoes that quickly captured an important share of the market. Another thing the new management did was to open their own retail store in Stillwater, directly north of the factory building.

However, these new innovations didn’t seem to help Connolly Shoe. In April 1967, the Connolly Shoe Co. went out of business. Johnson told the St. Paul Dispatch that, “Costs were going up and we were just not able to have an efficient plant here. Labor costs were a little higher and our production was a little lower, so, as a consequence we got squeezed.”

As news of the closing hit the streets and employees, some didn’t take the closing so well. One of the veteran employees was Otto Berg, who had been at the company for 50 years.

“I feel bitter,” Berg told the Dispatch, “As long as I felt good, I had figured on working. They didn’t seem to care much for the employees.”

The closing left 185 workers unemployed. A company that was started to get people back into the work force, 60 some years later accomplished just the opposite.

Today, more than 40 years later, the Connolly building still stands, and has been used as temporary quarters for the Stillwater Public Library, among other uses. The Connolly name is still seen on the building almost as a ghost of how things used to be, or maybe, how things might have been.

Brent Peterson is executive director of the Washington County Historical Society. His weekly column on local history appears Fridays in the Gazette.