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A Thesis Submitted for the Degree of PhD at the University of Warwick Permanent WRAP URL: http://wrap.warwick.ac.uk/106534 Copyright and reuse: This thesis is made available online and is protected by original copyright. Please scroll down to view the document itself. Please refer to the repository record for this item for information to help you to cite it. Our policy information is available from the repository home page. For more information, please contact the WRAP Team at: [email protected] warwick.ac.uk/lib-publications THE BRITISH LIBRARY DOCUMENT SUPPLY CENTRE STRUCTURAL CHANGE AND INDUSTRIAL DECLIN TITLE THE C A S E O r BRITISH TEXTILES AUTHOR INSTITUTION and DATE .......................... University of Marwick IMI)' Attention is drawn to the fact that the copyright of this thesis rests with its author. This copy of the thesis has been supplied on condition that anyone who consults it is understood to recognise that its copyright {ests with its author and that no information derived frbm it may be published without the author’s prior written consent. THE BRITISH LIBRARY D O CUM EN T SUPPLY CENTRE Boston Spa. Wethertoy West Yorkshire 21 United Kingdom REDUCTION X .............. CAM . I STRUCTURAL CHANGE AND INDUSTRIAL DECLINE: THE CASK OF BRITISH TEXTILES ------- Janet Walsh Submitted in accordance with the requirements for the degree of Ph.D. University of Warwick School of Industrial and Business Studies Ju n e 1989 Abstract This thesis explores the structure of international competition in the textile industry and the industry's development within the British context. The strategies of the three multinational corporations which dominate the British industry are analysed in detail. The method of investigation has involved an examination of both primary and secondary material on the industry. Two case studies of plant level restructuring were based on a series of interviews with management, trade union officials, and workplace union representatives at two of Courtaulds' textile plants. The analysis of the industry raises several problems with the existing theoretical literature. These concern the lack of a developed, integrated perspective on international structural change and uneven development, and, in particular, the manner in which analytical categories are elaborated to mediate between these different levels of analysis. The thesis demonstrates that the complex dynamics of restructuring and sectoral decline can only be understood in terms of a matrix of international structural forces, and a national configuration of social and economic relationships. The first chapter introduces a range of theoretical perspectives on international structural change and industrial decline. Section A analyses the international dimensions of change in the industry and the complex social and economic forces underlying the process of internationalisation. Section B outlines the performance of British textiles and clothing since the 1970s, and discusses a number of competing explanations of the industry's long term decline and current development. Section C investigates the international activities of three British textile multinational corporations, their domestic strategies and the changing balance between their national and international interests. An examination of restructuring at two of Courtaulds' textile plants involves an analysis of the implications of industrial change for social relationships at workplace level. CONTENTS PACE Ac know1edqeaents i List Of Tables ii List of Charts v List of Abbreviations Vi chaPt*r One: Structural Change and Industrial Decline 1 1.1: Introduction 1 1.2: Internationalisation and 'new divisions 4 of labour' 1.3: The Regulation Approach 9 1.4: The National Dinension 17 1.5: An Alternative Approach 2 2 1.6: The Method of Analysis 24 SECTION A: STRUCTURAL CHANGE IN THE TEXTILE INDUSTRY 27 Chanter Two: ni— nsions of Structural Change 31 2.1: Introduction 31 2.2: Shifts in Production, Employment and 32 Trade Plows Chapter Three: The process of internationalisation: 43 Multinationals in search of cheap labour? 3.1: Introduction 43 3.2: Multinationals and foreign direct investment 46 3.3: Licensing 50 3.4: Offshore Processing 51 3.5: International Subcontracting: liaits and 55 contradictions 3.6: LDCs: a satellite of First Morld 58 Multinationals? 3.7: Technology and the relocation of production 65 3.8: Textiles and Clothing: the site of 'new' 79 conpetitive strategies? Chapter Four: State Intervention: the developed 90 e c o n o m i e s . 4.1: Structural Change and State Policies: 91 an overview 4.2: Protectionism 105 Section A: Smeary 118 SECTION B: STRUCTURAL CHANGE AMD INDUSTRIAL 124 DECLINE; BRITISH TEXTILES AND CLOTHING Chapter Five: British Textiles and Clothing; 125 Decline or Regeneration? 5.1: 1973-82; the impact of recession 125 5.2: The 1980s: recovery or resurgence? 133 Chapter Six: The Decline of British textiles; 148 competing explanations. 6 .1 : The nineteenth century revisited? 148 6.2: Large Firms: ossified dinosaurs? 152 6.3: The State and the Industry: an historical 155 overview Chapter Seven: Decline or Regeneration; a move to 185 flexible specialisation? 7.1: Inter-Industry Competition 189 NATIONAL CORPORATIONS AND BRITISH 202 ■ STRATEGIES AND PLANT LEVEL Chapter Eight: Corporate 3tra in the 1980s. 204 8 .1 : Coats Viyella 204 8.2: Coats Viyella's locational strategy 216 8.3: Tootal 222 8.4: The Strategy of the Company Since 1986 226 8.5: Courtaulds 238 8 .6 : Textile Multinationals: in retreat from 279 the UK? Chapter Hina; The Recospos 11 ion of Capital-Labour 283 »BlBtlons 9.1: Courtaulda Hosiery 285 9.2: Courtaulds Spinning 314 9.3: Sumary 340 Chapter Ten: Conclusion 348 10.1: Internationalisation and 'new divisions 348 of labour' 10.2: The transition to neo-Fordise and 354 flexible specialisation 10.3: The Dialectic between the International 365 and the National 10.4: Britain's Industrial Decline 370 Footnotes 377 Bibliography 392 i Acknowledgements I would like to thank the senior u.tagesent; factory ■anageaent; supervisors and shopfloor union representatives who agreed to be interviewed at Courtaulds Hosiery, Courtaulds Spinning, the Textile Division of the General, Municipal and Boilermakers' Union and the National Union of Hosiery and Knitwear Workers. My special thanks to Peter Nolan, my supervisor at the University of Warwick, who has offered unfailing support, encouragement and critical intellectual guidance over the course of the PhD. I would particularly like to express ay gratitude for continued supervision during his sabbatical year. I would like to thank Professor Williaa Brown, University of Cambridge, for enabling me to finish the thesis whilst employed as a research officer at the Department of Applied Economics. Thanks also to Alan who has helped in ways too numerous to mention. u LIST OP TABLES PAGE 1. Production in the Textile, Clothing and 33 Manufacturing Industries 1963-80 2. Share in World Production of the Textile and 33 Clothing Industries 1963-80 3. Trends in the growth of textile and clothing 34 industry output, 1963-86 4. Distribution of (Cotton Type) Spinning Capacity 36 1974-85 5. Rnploynent in the Textile and Clothing Industries 37 1963-78 6. Share in world enploynent in the textile and 37 clothing industries 1963-78 7. Earnings ratios in textiles, 1987 65 8. Productivity Ratios in Textiles, 1980 66 9. Costs of Clothing production - Cotton Shirts, 1985 71 10. Concentration characteristics of textiles 93 industries in selected countries, 1985 11. Changes in UK Textiles and Clothing 1978-82 127 12. Fixed Capital Expenditure - UK Textiles, Clothing, 130 Leather and Manufacturing - 1974-82 13. The Balance of UK trade in textiles and clothing 131 1971-88 14. Growth Rate of UK I sports by value 1974-77, 131 1978- 82 15. UK Index of Textile Production 1973-87 132 16. UK index of Production for textile sub-sectors 134 1979- 87 17. Enploynent in UK textiles and clothing 1978-87 134 18. Esploysent in UK fibres, textiles, clothing and 134 household textiles, 1972-87 19. Output, enploynent, productivity trends for 135 UK textiles, clothing and leather and nanufacturing industry, 1979-87 20. Fixed capital expenditure in UK textiles, 136 clothing artd leather industry, 1978-87 21. Gross Value Added Per Person Enployed and 1 3 7 Labour Costs Per person Enployed for the textiles and clothing industry in UK, France, West Gernany and Italy 1982 ili 22. Growth Rates In Value Added and Value Added 137 Per Employee for the textiles industry in the UK, Prance, West Germany and Italy, 1961-85 23. Spinning and Weaving re-equipment ratios, 138 selected EC countries 24. Import penetration index and export/sales 141 ratios for UK textiles and footwear/clothing, 1981-87 25. Balance of trade of the UK's main competitors 142 in textiles and clothing, 1986 26. Consumer expenditure for clothing in the UK, 143 1978-87 27. UK imports of textile and clothing products 145 by source, 1985-88 (excluding non-MFA products) 28. Index of production for UK textile sub-sectors, 146 1987-88 29. Indices of output, employment and output per 146 person employed for UK textiles, clothing and leather, 1987 and 1988 30. Coats Paton; global distribution of 205 employment, 1974, 1978 and 1983 and post merger distribution, 1986 and 1987 31. Sales, Trading and Pre Tax Profits of Vantona 206 Viyella 1981-85 and Coats Viyella 1985-87 32. The Merger of Vantona Viyella and Coats Paton; 207 product and geographical distribution of sales 1985 33. Tootal's employment in the UK and overseas, 224 1973-87 34. Tootal's sales and profits 1983-88 228 35. Distribution of Tootal thread on a global 230 basis, 1987 36. Tootal's pre-tax profits 1982-89 237 37. Tootal's profit margins, 1984 and 1988 237 38. Courtaulds: sales, capital expenditure and 240 profits 1975-79 39. Courtaulds: return on capital employed, 1979 240 40.
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