Under the yellow flag: NASCAR's stalled growth and sputtering popularity are wrecking careers in the No. 1 state for motorsports.

• Author: Kalajian, Doug
• Position: COVER STORY

The NASCAR season roared off to a storybook start Feb. 20 when an implausibly young and polite unknown won the Daytona 500 in a car gussied up to look like David Pearson's old Mercury, down to the gold "21" on its flanks. It was an uplifting conclusion to a weekend that began in somber reflection on the death of the sport's biggest star, Dale Earnhardt, in a crash on the last lap of the race 10 years earlier. Only a victory by Dale Jr. could have generated more emotion than Trevor Bayne's unlikely triumph. But Earnhardt fans got plenty to cheer about as Junior, who had won the pole, stayed in contention until the closing laps.

The sporting press was quick to cite the national euphoria over Bayne, whose victory came one day after his 20th birthday, as evidence that stock-car racing had finally cleared the debris that littered its path the past several years. Stories about sagging fan interest, team mergers and shrinking sponsorships gave way to news that NASCAR's signature race drew some 30 million television viewers--a solid increase over the previous two years, though still a few million shy of its ratings heyday in 2008.

Whether any of this signals a resurgence is as unknowable as whether Bayne will be the sport's next Pearson. But none of it changed circumstances for Thomas Payne. After more than a decade at the pinnacle of stock-car racing, he had seen the end of his career rushing toward him at the conclusion of last season as ominously as Jimmie Johnson's Impala closing in at 200 miles per hour. "They called me to the office about 4:15 one afternoon," he recalls. "I said aloud, 'That's it. This means I'm out of here.'"

His boss at Roush Fenway Racing LLC, one of NASCAR's premier teams, didn't have to explain why Payne was being laid off. "So many teams were in trouble, so many people had been let go," Payne says. "I assumed it was coming. He asked me if I needed to gather my personal things, and I said, 'No, already got 'em.' I knew it was time."

If Payne's name rings a bell, it's more likely because it's a homophone for patriot-pamphleteer Thomas Paine than because he was a parts manager on the championship Cup teams of Kurt Busch and Matt Kenseth. Hard-core racing fans know every car number, every sponsor and maybe even the names of their favorite driver's over-the-wall pit crew. But behind those half-dozen familiar figures toil a hundred or more men and women like Payne--mechanics, metal sculptors, accountants and even personal trainers--who remain largely anonymous.

These days, many are also unemployed, or clinging nervously to their jobs, at the dozens of NASCAR teams based in North Carolina, most of them clustered around Charlotte. Just four years ago, then-Gov. Mike Easley crowed about "our $6 billion-a-year motor-sports economy. More than 14,000 people are directly employed in the motorsports field, making North Carolina the No. 1 state in the nation for this industry." Now, the talk is different. "I just heard from two more people who were let go this week," says Don Gemmell of Mooresville, who built cars for Dale Earnhardt Inc. until his job became redundant when the team merged with Chip Ganassi Racing after the 2008 season. "A lot of teams let people stay at reduced pay. I know guys who stayed just to keep the benefits."

For nearly two decades, one of the biggest benefits of working in a race shop had been a first-class ticket to one of the wildest thrill rides in professional sports, NASCAR's dizzying ascent from regional curiosity to national phenomenon. From the late 1980s on, the circuit expanded to a succession of new tracks in different parts of the country--from New Hampshire to Indiana to Kansas to California--and with each fresh venue came a wealth of rabid new fans and rich new sponsors who spent lavishly to propel their cars out front where the TV cameras would focus on their logos. Money poured into teams faster than gasoline poured into Jeff Gordon's tank during a green-flag pit stop, and it washed away just about every vestige of the far simpler sport that had begun a half-century earlier along the fields and back roads of the rural South. The last of the old single-car teams that were run out of sheds and converted brake shops disappeared. Every team fielded at least two cars in each race, then three and then four, all of them hand-molded from bare metal in sterile shops with glistening floors and banks of electronic test equipment worthy of NASA. "This thing grew so fast that money just kept coming into the deal, and the teams kept spending it," Gemmell says. "If there was a problem, you just threw money at it--but that turned out to be a problem, too."

The problem became evident by the 2007 season, as track attendance and TV ratings began to flatten--or dip--and sponsors balked at the steeply rising price of underwriting a Sprint Cup team. Even big teams strained to stay competitive while replacing their entire inventory with the safer but less distinctive Car of Tomorrow design. Several teams took on outside investors to keep the cash flowing. Among the most startling developments was the merger of Roush Racing, which had won back-to-back championships in 2003 and '04, with Boston-based Fenway Sports Group. For all the sweat NASCAR had poured out bumping past baseball as a national pastime, one of racing's most successful teams was suddenly at least partly in the hands of the Red Sox.

Gemmell felt the tremors during the 2008 season from deep inside the team, which had passed from the elder Earnhardt to his wife, Teresa. "Everybody knew something was coming down when sponsorships started to fall away," he says. The Mooresville team expanded to four cars, despite losing Dale Jr. to Charlotte-based Hendrick Motor Sports LLC, but it could only secure full-time sponsorship for three. That left a $20-million hole in the budget. "The four cars were all running out of one building--you're talking almost 300 people--and all of us saw the writing on the wall," Gemmell says. "The week before the season's final race at Homestead, groups of us were called in and let go--225 people in one day. It was definitely emotional."

[ILLUSTRATION OMITTED]

It was an emotional time for the whole country, as huge losses in the banking industry quickly spread to the stock market and other facets of the economy. For NASCAR, this meant more sponsor pullbacks, and more teams responded by slashing payrolls. The job losses continued even after the Daytona 500 kicked off the new season. "Nobody knows the real number, but an educated guess...