US Textile-Industry Jobs in Jeopardy
THE United States stands to lose hundreds of thousands of jobs in the textile and apparel industries over the next decade, according to a recent study by the WEFA Group, an economic consulting firm based near Philadelphia.
The job losses will be most severe if the current system of import quotas is phased out as part of a new world trade agreement currently under negotiation.
The study, paid for by the American Textile Manufacturers Institute (ATMI), forecasts that US textile and apparel employment of about 2 million will drop by 392,000 jobs between 1992 and 2002 because of increasing productivity as well as continued penetration of the US market by overseas producers.
If the quotas are phased out, the losses in these industries are estimated to rise to 647,000.
Some experts say job losses will not be so great, and that the benefits of freer trade to the overall US economy outweigh the costs. But the forecast suggests the kind of hurdles that a new world trade agreement must leap to be approved by the 108 nations involved.
Textiles are one of 15 areas under negotiation in the Uruguay Round of the General Agreement on Tariffs and Trade (GATT). Although negotiations were to have been finished in 1990, this GATT accord seems far from conclusion.
Tomorrow President Bush will meet with European Commission president Jacques Delors to try to break a longstanding impasse on European agricultural subsidies.
If that and other issues are resolved and the accord passed by member nations, the current system of international textile quotas known as the Multifiber Arrangement (MFA) is set to be phased out over a 10-year period.
The ATMI is pushing for a 15-year time period, says Charles Bremer, the group's director of international trade. Mr. Bremer also says the textile trade rules should add language requiring all nations to liberalize access to their markets equally.
If such changes are not made, "we'll make [Congress] aware of just how unfair and unbalanced this is," Bremer says. In recent years, Congress has passed legislation to strengthen textile and apparel quotas, but has failed to override presidential vetoes.
The MFA has held back the growth of imports from Southeast Asia into the US market. But imports have still risen at about 7 percent a year, according to William Cline, a textile expert at the Institute for International Economics.
Dr. Cline's forecast is more optimistic than that of WEFA; he says US textile manufacturers are competitive and will not be hurt much by an end to quotas. The apparel sector stands to lose about 114,000 jobs over the next decade under the current regime, and another 114,000 if the MFA is phased out, he estimates. A Congressional Budget Office survey concludes that the annual costs to consumers from current and proposed restrictions range from $39,000 to $74,000 for each job retained.
More than 1 million Americans are employed making apparel, a further 700,000 in textiles, and almost 400,000 more in supporting industries such as growing cotton and wool or making synthetic fibers.