The U.S. Textile and Apparel Industry: a Revolution in Progress
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The U.S. Textile and Apparel Industry: A Revolution in Progress April 1987 NTIS order #PB87-196762 Recommended Citation: U.S. Congress, Office of Technology Assessment, The U.S. Textile and Apparel Industry: A Revo- lution in Progress–Special Report, OTA-TET-332 (Washington, DC: U.S. Government Printing Office, April 1987). Library of Congress Catalog Card Number 87-619815 For sale by the Superintendent of Documents U.S. Government Printing Office, Washington, DC 20402-9325 (order form on p. 119) Foreword America’s textile and apparel industries are investing in new technology at an unprece- dented rate. Productivity growth in textile manufacturing has been double the average growth of manufacturing as a whole for over a decade, and apparel production may be on the brink of a revolutionary increase. New information technologies have the potential to unify dis- parate elements of the industry, from fiber production and weaving to product assembly and retailing—linkages that can reduce costs and tailor products to changing patterns of consumer taste and preference. Such new technologies are rapidly changing the face of one of the Nation’s oldest industries. The manufacture of textiles and apparel has the potential to remain a significant part of the U.S. economy. Despite the optimism made possible by technical progress, U.S. textile and apparel firms are in danger. Little of the technology that allowed for increased productivity was developed by U.S.-based enterprises. The same advanced technology is available to firms throughout the world, including those in nations that pay workers a small fraction of the U.S. minimum wage. Sophisticated networks of U.S. and foreign companies use these factors to undercut U.S. supplier prices; apparel imports have grown from 25 to 50 percent of the U.S. market during the past 10 years. Technology alone may not be able to salvage major parts of the industry. increases in U.S. labor productivity and U.S. imports have led to significant job losses within the domestic textile and apparel industry. And while economic growth creates new job opportunities throughout the economy, plant closings and industrial reorganization can cause severe hardships for communities dependent on local textile and apparel firms. It also appears that the skills likely to be needed by future textile and apparel enterprises may re- quire extensive training programs even for workers remaining in the industry. The present state of the U.S. textile and apparel industry presents Congress with diffi- cult choices on trade policy and on government support for research and development. We trust that this special report will provide a framework for making such decisions. This special report supports a larger OTA project that analyzes the effects of technologi- cal change and international trade on the structure of the domestic economy and options for public policy. The textile and apparel industries were selected for special attention be- cause they provide key insights into the problems of changing manufacturing enterprises. JOHN H. GIBBONS Director List of Reviewers Gorden A. Berkstresser James A. Parrott Professor Economist School of Textiles International Ladies’ Garment Workers’ Union North Carolina State University New York, NY Raleigh, NC James Plouffe Peter Butenhoff Manager Manager Textile Fibers Division International Trade Affairs E.I. du Pent de Nemours & Co. E.I. du Pent de Nemours & Co. Wilmington, DE Wilmington, DE Nicholas C. Williamson Michael J. Copps Professor Director of Government Affairs Management Department Collins & Aikman Corp. University of North Carolina at Greensboro Washington, DC Greensboro, NC Henrietta Dabney George Wine* Director Chief Economist Research Department American Textile Manufacturers Institute Amalgamated Clothing and Textile Workers’ Washington, DC Union New York, NY Maria Fernandez-Kelly Professor Department of Geography and Environmental Engineering The Johns Hopkins University Baltimore, MD *Material supplied by the American Textile Manufacturers Institute included comments from several reviewers under George Wine’s auspices. iv The U.S. Textile and Apparel Industry: A Revolution in Progress OTA Project Staff Lionel S. Johns, Assistant Director, OTA Energy, Materials, and International Security Division Henry Kelly, Project Director Technology and the American Economic Transition Ruth Ruttenberg, Contractor Gordon A. Berkstresser, Contractor Daniel Chenok, Research Assistant Andrew Wyckoff, Analyst Phyllis Brumfield, Administrative Secretary Contributors N.C. Williamson L. Michael A.R. Barrier Contents Chapter Page I. Overview . ... ... ... ... ... O . 3 An Industry in Transition . 3 The Challenge From Abroad . 4 Linkages to the Rest of the U.S. Economy . 6 The Impact on the U.S. Labor Force . 7 The Impact on the U.S. Consumer . 8 Looking to the Future: Alternatives for Policy . 9 A Guide to This Report. 11 2. The U.S. Textile and Apparel Industry: Technology and Structural Change . 15 U.S. Markets for Textiles and Apparel . 16 Characteristics of the Domestic Marketplace . 16 Trends in Consumer Purchasing . 17 A Technological Revolution . 18 New Production Technologies . 19 Consistency, Standardization, and Quality . 22 Coordination and ’’Quick Response” . 23 Industrial Structure . 29 Background . 29 Structural Changes . 31 Trends in investment and Disinvestment . 32 Into the Future . 33 3. The Major Industry Sectors: Fiber, Fabric, Finished Products, and Machinery Manufacturing . 37 The Production of Fiber . 37 Background . 38 Technological Innovations. 42 Industrial Structure . 46 Textile Mill Products . 49 TechnologicalBackground . Innovations. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .51 49 Industrial Structure . 59 End Uses of Textiles . 61 Industrial Structure . 62 Pending Technology . 67 Textile Machinery Manufacture . 74 Background . 74 Industrial Structure . 75 4. Areas for Decision: Trade, Technology, and Employment . 79 Declining Trade Balances Shake Textile and Apparel Markets . 79 The Emergence of a Global Textile Industry . 81 U.S. Response . 87 Trade and the U.S. Consumer . 92 The Adequacy of Domestic Innovation and Capital Investment . 94 Research and Development. 94 Capital Investment Uneconomic Necessity . 95 Implications for the Textile and Apparel Labor Force . 96 Employment Changes Within the Industry . 96 vi Contents–continued Page Impact on Individuals and Families . 98 Impact on Communities and Regions of the Country. 98 5. Policy and Survival. .................103 Employment Issues . 103 Assistance for Textile and Apparel Workers . 103 State and Local Responsibilities for Employment Training and Transition . 105 Trade Adjustment Assistance . 105 Trade Alternatives . 106 Export Promotion. 107 Import Regulation . 108 Other Trade Policy Areas . 109 Research and Development . 110 Public/Private Ventures . 110 Investment Incentives . ..