WASHINGTON — The retailing and textile and apparel manufacturing sectors absorbed more employment losses in August even as the U.S. added a total of 144,000 jobs.

The number of jobs at general merchandise stores fell 2.3 percent to 2.83 million, while department store positions dropped 3.2 percent to 1.61 million workers. Apparel and accessories stores again provided the only bright spot, increasing payrolls 0.8 percent to 1.35 million.

Textile and apparel manufacturers cut 2,800 jobs from payrolls and the Labor Department revised its July employment numbers in the two industries downward by 3,200. Total employment in the two sectors in August was 696,500 compared with 726,500 in August 2003, reflecting a long-term erosion because of what many executives say is competition from low-cost imports.

Textile mill employment fell by 300 and stood at 235,700 last month, a decline of 16,100 against a year ago, while textile mill products employment dropped by 600 to 178,400, but was up 7,700 compared with August 2003. Apparel factories cut 1,900 jobs last month to employ 282,400; the sector lost 21,600 jobs compared with a year ago.

The latest U.S. employment statistics were released less than two months before the presidential election, in which job creation is a key issue, and hours after President Bush mapped out a domestic economic agenda in his speech accepting the presidential nomination at the Republican National Convention. Textile groups seized on the numbers as they turned up the pressure on the Bush administration to restrain imports from China. The U.S. has lost a total of 913,000 jobs since Bush took office.

The nation added about twice as many jobs in August as in July, although just keeping pace with the increase in the adult population. The unemployment rate dipped to 5.4 percent from 5.5 percent in July. The Labor Department also revised its new jobs figures for July to reflect a boost to 73,000 from the 32,000 reported.

“This economy has created 1.7 million new jobs over the past year, including 144,000 jobs last month alone, and nearly 60,000 more jobs than what was initially announced in the previous two months,” Labor Secretary Elaine Chao said in a statement.

Since Bush took office in January 2001 employment in the textile industry has plunged by 163,200 jobs. The apparel industry lost 186,600 in the same period. The statistics have been adjusted to reflect a reclassification of apparel jobs earlier this year.

This story first appeared in the September 7, 2004 issue of WWD. Subscribe Today.

“While jobs appear to be coming back in other industries, they have not come back in the textile industry, primarily due to imports,” said Robert DuPree, vice president at the National Council of Textile Organizations. “We’re only down 8,000 from a year ago, but that certainly is not roaring back and we are nowhere near recouping the losses suffered in recent years. We’re fearful that without action on the [quota] safeguard petitions we intend to file, these numbers will start dropping like a rock again.”

The U.S. textile industry plans this month to file petitions calling for the government to reimpose quotas on apparel and textile imports from China based on the threat of market disruption.

“Today’s report is further evidence that the relative stability of output and jobs the industry enjoyed earlier in the year may be coming to an end as domestic demand growth cools, the flood of foreign imports continues and Jan. 1 [the day global quotas will be lifted on apparel and textile imports] approaches,” said Charles McMillion, president of MBG Information Services, a research firm.

Bush, seeking to quell critics of his domestic economic policies, proposed an initiative in his acceptance speech to help communities devastated by employment cuts. So-called Opportunity Zones would help areas that “have lost a significant portion of their economic base as a result of our changing economy,” according to a White House fact sheet.

The administration said it would encourage new and existing businesses to invest in the zones. These new designated areas differ from existing Empowerment Zones and Enterprise Communities because they expand the focus of assistance beyond economic activity to include education, job training, affordable housing and other initiatives.

Businesses within an Opportunity Zone would get an income tax reduction, qualify for an extra $100,000 tax writeoff for the purchase of tools and other equipment, in addition to the $100,000 they already qualify for under Bush’s tax policies, and receive tax credits for hiring residents in the zones.

Quota Watch: Embargo Countdown
In four short months, the quota system governing apparel and textile quotas will expire for the 147 member nations of the World Trade Organization. But for now, importers and retailers are nervously watching several apparel and textile categories start to fill quickly, and many are shifting production from one country to another to avoid getting caught in embargoes — the government process for denying goods entry into the country. If sourcing executives run into an embargo, they have the choice of holding excess merchandise in inventory until January, often a costly option, or selling the goods, perhaps at a loss, in other countries. As of Sept. 2, there were 10 apparel and textile quota categories more than 75 percent filled.
Country
Product
Quota Limit
Usage To Date
 
China cotton sateen fabric 5.01 million SME 100 percent
China knit fabric 9.6 million kg. 78.8 percent
Belarus wool coats 67,320 dozen 85 percent
Indonesia cotton coats 430,161 dozen 82.2 percent
South Korea wool suits 59,975 units 84.9 percent
Philippines cotton/man-made fiber skirts 1.02 million dozen 89.4 percent
Philippines wool suits 45,291 units 87.6 percent
Pakistan swimwear 1.4 million kg. 84.3 percent
Turkey wool trousers 43,464 dozen 87.9 percent
Vietnam cotton knit shirts 15.6 million dozen 92.9 percent
SME=Square Meters Equivalent
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