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Textile manufacturing to be one of the major issues at the World Trade Organization's meeting in Cancun, Mexico
National Public Radio
Morning Edition: 10 a.m.-11 a.m.
September 12, 2003

Bob Edwards (Host)

Where clothes are made is the subject of international debate. Global trade dramatically has changed the textile and apparel industries and is a key issue being addressed at the World Trade Organization's meeting in Cancun, Mexico. As large American retail and apparel companies turn to cheap labor overseas, textile manufacturing here has declined sharply. NPR's Elizabeth Blair reports.

Elizabeth Blair (Reporting)

To understand why American textile manufacturers are hurting, just look in your own closet.

Ms. JENNIFER FULTON (Corporate Communications Specialist): This is a good deal. This is, like, 200 bucks, I think; and I got this at Filene's Basement on sale, made in the Philippines.

BLAIR: Jennifer Fulton, a corporate communications specialist in Washington, DC, let us into her closet.

Ms. FULTON: This is a JC Penney find. This is kind of like a summery, casual suit made in Bahrain. This is kind of a flowery rayon Liz Claiborne blouse, and this is actually a hundred percent silk and made in China.

BLAIR: Just about everything in Fulton's closet was made overseas. That's typical for most Americans. In the last three decades, the clothes we wear have gone from 90 percent made in the USA to less than 20 percent made here. Ever since the post-World War II period, trade barriers have gradually been coming down. The trend has given companies like The Gap, Wal-Mart and Ann Taylor greater access to cheaper labor and raw materials. It's also lowered prices for American consumers. But textile companies like Burlington Industries and Guilford Mills have been hard hit. According to the American Textile Manufacturers Institute, more than 250 US textile plants have closed in the past six years. And in the last year and a half, more than 30,000 American textile workers have lost their jobs, a situation that has forced factory owners to join with unions to fight what they see as unfair trade policies. It's a relationship that's new for both sides.

Mr. HARRIS RAYNOR (UNITE): When I come on that parking lot and go to visit their plant, I'm usually met by a large gentlemen looking very much like Rod Steiger from "In the Heat of the Night" and acting that way.

BLAIR: Harris Raynor is southern regional director of Unite, one of the unions that represents needle trades and textile workers. At a recent press conference in New York, he pointed out that US companies have greater costs because they have to respect US environmental and labor laws like clean air, health insurance and overtime.

Mr. RAYNOR: But somehow, our country says that when you step five feet across this border, none of that matters anymore. And you can be a textile industry anyplace else and you can pollute the air all you damn please. That's what having no trade policy means, having a trade policy that says the values that built this country belong in all of this world.

BLAIR: But many American companies voluntarily monitor the foreign factories they use, according to Peter McGrath, head of purchasing for JC Penney. He also heads up a trade association for American textile importers.

Mr. PETER McGRATH (Head of Purchasing, JC Penney): All the big companies, importers, retailers, in the United States have either a compliance, standards or codes conduct which absolutely mandate the letter of the law within the country that these goods are being made is followed. And a lot of times, I think we try to export our American point of view to countries that are not anywhere near as developed as we are.

BLAIR: Despite complaints from American textile mills and their unions, more and more production will move to those countries where labor is cheapest. In 2005, countries in the World Trade Organization will try to eliminate all textile quotas, and if they do, imports are expected to soar. Jim Leonard, who heads the textile office at the US Department of Commerce, says several American companies have asked that some quotas be extended, but he doesn't expect that to happen.

Mr. JIM LEONARD (US Department of Commerce): It's been a 10-year period where the industry knew this was coming and they needed to make some adjustments, and I think some companies have done that and some have not.

BLAIR: But when it comes to global competition, many American companies believe they're at an unfair disadvantage, especially against China, the biggest exporter of textiles and apparel. One of their main arguments is that China regulates its currency, keeping it artificially low and, therefore, making labor and production costs much lower than they would otherwise be. Bob Miller is senior vice president of the National Spinning Company.

Mr. BOB MILLER (Senior Vice President, National Spinning Company): I was in Old Navy with my children, and I showed them a sweater and I showed them how it was made with many different colors. It was made from wool yarn. It was hand pieced together and it was selling for $9.99. And I said to them, `There's no way this garment should sell for this.' This is no company that can stay in business that can sell this garment for $5 so that Old Navy can sell it for $10. That's just non-realistic.

BLAIR: Jim Leonard says his offices are viewing a handful of these kinds of allegations against China. At the same time, he says, they're trying to help American companies export. He says some companies are already doing so successfully by offering unique products like plus sizes for women.

Mr. LEONARD: A lady from Scotland and one from London came over and bought $10,000 worth of apparel because they can't get it there.

BLAIR: Some niche apparel manufacturers are finding success keeping all of their operations in the United States.

Mr. DOV CHARNEY (American Apparel): I don't believe that you should run into a market just to grab cheap labor. It's extremely inefficient.

BLAIR: Dov Charney knows he takes a minority view. He owns American Apparel, a company that sells T-shirts and other casual clothes all cut and sewn in Los Angeles. Even the fabric is knitted on site. He pays his workers $12 an hour or higher. American Apparel did $40 million in sales last year. Charney says he tried making clothes in Mexico, but with the constant traveling, high worker turnover and delays, it didn't work. Charney says having all the production in Los Angeles gives him more flexibility.

Mr. CHARNEY: We're able to make slight adjustments, we're able to respond to market forces at a breakneck speed, and we're able to focus instead of on the complexities of offshore manufacturing, we're able to focus on our design and technology.

BLAIR: Charney believes it's better all-around business to sell the product where you make it, but regional production is far from the minds of those attending the World Trade Organization's meeting in Cancun. Delegates there are trying to make progress towards the ultimate goal of free trade — not easy to achieve when everyone is trying for greater access to all markets while protecting their own turf. Elizabeth Blair, NPR News, Washington.

EDWARDS: On Monday, MORNING EDITION begins a five-part series on the fashion industry.

From NPR News, this is MORNING EDITION.

(Credits)

EDWARDS: I'm Bob Edwards.

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Record Number: 200309121008