Posted on 04/16/2016 2:55:11 AM PDT by lowbridge
Los Angeles was once the epicenter of apparel manufacturing, attracting buyers from across the world to its clothing factories, sample rooms and design studios.
But over the years, cheap overseas labor lured many apparel makers to outsource to foreign competitors in far-flung places such as China and Vietnam.
Now, Los Angeles firms are facing another big hurdle — California's minimum wage hitting $15 an hour by 2022 — which could spur more garment makers to exit the state.
Last week American Apparel, the biggest clothing maker in Los Angeles, said it might outsource the making of some garments to another manufacturer in the U.S., and wiped out about 500 local jobs. The company still employs about 4,000 workers in Southern California.
"The exodus has begun," said Sung Won Sohn, an economist at Cal State Channel Islands and a former director at Forever 21. "The garment industry is gradually shrinking and that trend will likely continue."
In the last decade, local apparel manufacturing has already thinned significantly. Last year, Los Angeles County was home to 2,128 garment makers, down 33% from 2005, according to Bureau of Labor Statistics data. During that period, employment also plunged by a third, to 40,500 workers. Wages, meanwhile, jumped 17% adjusting for inflation, to $698 per week — although that can include pay for top executives, as well as bonuses, tips and paid vacation time.
(Excerpt) Read more at latimes.com ...
Why is it morally correct via trade policy to decimate entire swathes of domestic industry, impoverishing the former working class of this country, merely to enhance the profit margins of companies that close down domestic manufacturing operations? How is this an objective good for the nation? Damage to the economy and the strain on public services have been enormous, and for what? For a much smaller group of people to do a little better with their stock portfolios.
“Why is it morally correct via trade policy to decimate entire swathes of domestic industry, impoverishing the former working class of this country, merely to enhance the profit margins of companies that close down domestic manufacturing operations?”
It is morally correct to have a trade policy which benefits the majority of the population by providing quality products at lower prices rather than benefiting a very few people by restricting trade.
Take for example, tennis shoes or sneakers. In 2010, American consumers bought $22.3B of sneakers imported from 6overseas. The US government collected $2.3B in tariffs on these imports. The only manufacturer of sneakers in the US is New Balance that employees 1350 people. These tariffs cost the American consumer approximately $1,703,704 for each job protected. IOW, EVERY American who buys sneakers is forced to pay an exorbitant amount for the benefit of ONLY 1350 people. How can you possibly justify that?
You also should consider that these additional costs paid by all Americans takes money that they could be spending on other things which just might also create other American jobs.
“There is NOTHING immoral about protectionism. Nothing. George Washington signed the Tariff Act of 1789 So was he immoral? Why should I listen to a loser who knows nothing about neither morality or history.”
You might want to study a bit of history as well as some economics. The Tariff Act of 1789 was passed to fund the federal government. Some of the Republicans at that time wanted to pass protective tariffs but the Democrats stopped those efforts since they felt tariffs should only be high enough to fund the government. They also felt that tariffs high enough to be protectionist would be harmful to consumers.
Here’s a source: (read the first paragraph) https://en.wikipedia.org/wiki/Tariffs_in_United_States_history
Americans have proven over and over again at the cash register that "Made in the USA" justifies no more than a tiny price premium, if any. That's why the remaining L.A. factories crank out cheap stuff almost exclusively.
There is still a significant market for higher-quality garments, rather than the generic $10 T-shirt everyone is referring to, however in this area the USA's big problem is that the art has been lost. Those giant garment factories that used to dominate the landscape in North Carolina are long gone, and the talent has since retired or moved on to other careers.
And Canada, China, and Turkey are already doing quality apparel production faster, better, and cheaper than any US company will ever be able to. The barriers to re-entry are just too high - there is not enough money in it and too much government remains in the way.
It’s going to take a war and a cut-off of supplies for Americans to take the hint.
Government regulation continues to be the biggest drag on the US economy.
“Why should I listen to a loser who knows nothing about neither morality or history.”
-
Do you always call people with whom you disagree “losers”?
How nice.
.
You act as if there have always been “ONLY 1350 people” employed in domestic manufacture of shoes. I’m sure you can dredge up any number of former domestic industries that have very few employees left, as if this bolsters your argument rather than mine.
The Minimum Wage should be ZERO, as in less than a Penny.
People can work their way up from there, I did.
It doesn’t matter, long as I can support my family with this minimum wage job...
I don’t follow your logic; $7.50 per hour already can’t compete with overseas workers earning $7.50 per day, and $15 per hour will just cost more jobs (creating more people earning $0 per hour). Artificially raising it to $15 per hour still won’t put those people in houses or let them start families (unless they want to live in undesirable areas), so what is the benefit? In a consumer-driven service economy, what business does well without good jobs?
I’m shocked at how many young people see not just families and homes as far beyond their reach, but CARS (which had been a significant part of the economy for decades).
There is no such thing as a service economy, an economy exists to service manufacturing. You manufacture or you “die”.
An economy has needs and therefore produces jobs. Some jobs are small, but are still needed. There always will be low skilled jobs that don’t pay a lot. It doesn’t make them unnecessary.
Young people are the most spoiled and weak generation America has ever produced. Worse they have been taken advantage of by higher education and Obama. With luck they will learn and become one of America’s strongest generations. But they have to learn that freedom and self-determination is their future. They are not slaves begging for a better way of life to their government, which is what exists in Europe and it’s what Sanders and the Democratic Party are trying to produce.
I never implied the low-skilled jobs were unnecessary.
As for young people, they aren’t even the focus of this legislation. It is designed to accommodate the people who will work low-wage jobs their whole lives (since there will be many more workers than “good” jobs). In my area many low-skilled jobs are worked by middle-aged and older Americans and Hispanics; as my teens look for work they encounter these people in jobs that in my day were held by high school students.
Low wage jobs aren’t meant to be a career.
American Apparel are exploitative scumbags, unless they have changed dramatically which I doubt.
Yes, tariffs designed to be protectionistic are immoral since their only purpose is to use the power of government to extort wealth from one class of people to transfer to another class. Robbery is always immoral.
That’s right - but our government knows that for more and more Americans, that is what the future holds for them.
The average American can’t stop the flight of good jobs overseas; we built the information superhighway, and now we whine because it works.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.