The correct answer is: Conditions in some towns indebted workers to trap them in the labor system.
The impact that company towns had on working conditions is that conditions in some towns indebted workers to trap them in the labor system. Employers developed company towns, where individual companies owned and built all the buildings and businesses like schools, churches, libraries, and other social amenities to encourage healthy communities and productive workers. Without external competition<em></em>conditions such as housing costs and cost of groceries in the company, towns could sometimes became exorbitant, where workers built up massive debts which they were required to pay off before leaving thus trapping them in the labor system.<em></em>The company towns often housed laborers in guarded areas, with an excuse of “protecting” laborers from unscrupulous travelling salesmen. In the South, free laborers and convict laborers were often housed in the same spaces and suffered equally terrible mistreatment.
