Textiles take forefront in U.S. trade action

By Thomas Wilson
STAR STAFF
twilson@starhq.com

   A decision by the Bush administration last week to impose tariffs against some textile imports from China may offer some protection sought by textile industry lobbyists seeking the action. However, protectionism policies come late for the near-extinct textile industry of the south.
   The Committee for the Implementation of Textile Agreements (CITA), chaired by the U.S. Commerce Department, voted last week to invoke "safeguard relief" on three textile products (knit fabric, dressing gowns and robes, and undergarments) imported to the United States from China following petitions filed by the U.S. textile industry.
   "This decision demonstrates the Bush administration's commitment to our trade rules and America's workers," said Commerce Secretary Don Evans. "The availability of this safeguard mechanism is an important tool for facilitating China's transition into the WTO. We look forward to beginning our consultations with the PRC, with the goal of achieving a mutually beneficial result on this issue."
   The petitions were filed by the industry under a special provision of China's WTO accession agreement that allows the U.S. (and other WTO members) to impose temporary quotas on textile imports from China in the event those imports are found to cause "market disruption." Once the China textile safeguard is invoked, the U.S. is required to pursue a negotiated resolution of the matter with the Chinese government.
   Textile manufacturing was long an economic staple of the south when industrialization moved south in the early 20th century. While the "land of cotton" harks back to the antebellum South, cotton and apparel manufacturing remained an enormous economic engine throughout the 20th century. North American Rayon Corporation and American Bemberg made Elizabethton a mill town and proud of it during the 1920s and 1930s when thousands of Elizabethtonians and Carter County residents made their living manufacturing rayon material. Levi-Strauss employed hundreds of Johnson County workers who made manufactured blue jeans for the with-it masses around the world. Those companies once so prominent in Southern Appalachia are long gone.
   Manufacturing employment in the Tri-Cities Metropolitan Service sector topped 50,900 in 1990, according to the state Department of Labor and Workforce Development (TDLW). That number has since fallen to just over 40,000 in 2002. Roughly 9,000 manufacturing jobs have evaporated in Tennessee since October 2002, according to the TDLW.
   State figures reported unemployment rates in 65 county rates decreased in October. Carter County's unemployment rate fell from 5.5 in August to 4.9 percent in September. The numbers don't reflect textile and apparel related industries, most likely because so few large scale operations remain in the state.
   A report issued by the TDLW in 2001 estimated employment at yarn and thread mills, narrow fabric mills and knitting mills to drop 10 percent between 2000 and 2010 based a one percent job loss rate each year. Undergarment product employment is expected to drop 50 percent over the same period. The state Labor Department based their figures on a report called the "Industry Employment & Projections" from 2000 to 2010.
   The U.S. Bureau of Labor Statistics reported in a Nov. 2001 industry review that national textile-related employment fell from 642,000 jobs in 1996 to just over 475,000 jobs in 2002 -- an average annual decline of 3 percent each year. The construction and real estate industries also are important users of textile mill products.
   Apparel production also ranks high under industries with the largest wage and salary employment growth and declines between 1996 and 2006. The Bureau of Labor Statistics predicts the textile industry will lose another 103,000 jobs by 2010 -- the U.S. economy's third largest source of declining employment.
   Due to the labor-intensive nature of the apparel industry, domestic employment will continue to be vulnerable to import competition from low-wage countries, BLS findings state. Employment growth will be further constrained as mergers and acquisitions among retail department stores -- the main buyers of apparel products -- forces this industry to consolidate in order to remain competitive.
   BLS also reports that imports are also projected to supply an increased share of footwear and luggage, handbags and leather products. Employment in these industries is expected to be the first and fifth most rapidly declining in the economy. Combined, these two industries are projected to continue their historical employment contraction and decline to 44,000 jobs in 2010, down from nearly 72,000 jobs in 2000, according to the report. Likewise, real output for the footwear and luggage, handbags and leather products industries is expected to decline by 6.4 percent and 1.5 percent respectively, the second and sixth fastest in the economy, according to BLS.
   The BLS report states, "For the two industry groups textile mill products and apparel and other textile products, the long-term trends toward increasing automation and use of offshore labor for work processes that cannot be easily automated are expected to continue." Productivity gains resulting from further automation and from the implementation of new technologies are expected during the projection period. Apparel production remains highly labor intensive.
   Offshore assembly of apparel has become, and is expected to continue to be, the norm, the report states. Demand for apparel is, of course, affected by fashion tastes and changes in cultural attitudes towards appropriate dress. The products of the textile mill industry group mostly serve as inputs for other manufactured products. Apparel is an example, as are cloth seat coverings in automobile and furniture production.