NEW YORK -- The U.S. textile industry managed to return to profitability last year, but just barely and at a great cost of jobs, as it faced its sixth consecutive year of volume declines.
The American Textile Manufacturers Institute on Wednesday reported that the industry as a whole recorded $300 million in profits in 2001, compared with a loss of $360 million the year earlier. With the exception of that loss, 2001's financial results were the worst on record since the early Sixties.
Still, 2001's results represented a meager profit margin on total industry sales of $53.9 billion, which were off 6.7 percent from the prior year.
According to David Link, the Washington-based group's chief economist, that figure includes all revenues generated by companies that the government classifies as being in the textile industry. That means sales of carpet and rope are included, as well as revenues generated by other businesses that textile companies run. Total shipments of fabric and yarn were $46.8 billion, an 11.9 percent drop and the sixth consecutive year of declines.
The report also showed just how grim the year was for the nation's textile workers. Waves of mill closings and bankruptcies -- Link said about 114 textile plants have been closed over the past year -- cut the number of workers in the industry by 9.8 percent, for an annual average of 476,000. That decline was more than double the overall drop of 3.8 percent in total U.S. manufacturing employment.
Hourly wages rose slightly, to $11.34 from $11.16, but the number of hours worked in the average week dropped 12.2 percent, cutting the average weekly paycheck to $453.68.
"These numbers reflect the need for the U.S. government to act swiftly to combat the crisis in the American textile industry," said ATMI president Chuck Hayes, who is chairman of Guilford Mills Corp.
The ATMI's current lobbying agenda includes seeking an extension of how long companies can carry losses on their books for tax purposes, insuring that the U.S. require fabrics to be dyed and finished in the States to qualify for duty- and quota-free treatment under the Trade and Development Act of 2000, and tighter enforcement of Customs procedures to stop illegal transshipments.
Hermès is launching a Laundromat pop-up shop in NYC - dubbed Hermèsmatic - where customers can bring their old scarves to be dip-dyed by an expert. Get all the details on WWD.com. #wwdnews (📷: @donstahl)