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Company towns often exploited workers by creating a dependency on their employers for housing, goods, and services, leading to a cycle of debt and control. Wages were frequently low, and prices for necessities were inflated, making it difficult for workers to save or improve their conditions. Additionally, the lack of independent community resources limited workers' ability to organize and advocate for better labor rights, as the company could easily retaliate against any dissent. This environment stifled the growth of the Organized Labor Movement by inhibiting solidarity and collective bargaining efforts.

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