FEBRUARY APPAREL JOBS OFF, BUT WORK ROSE IN TEXTILES

Byline: Joanna Ramey

WASHINGTON — For the 19th consecutive month, employment in the apparel industry in February hit another all-time low. At the same time, the job picture at textile mills improved, reversing a 15-month trend of losses.
In the overall economy, the job outlook remains bright, the Labor Department reported Friday in its monthly unemployment survey — so bright that it helped trigger a 171.24-point plunge in the Dow Jones Industrial Average Friday (see story, page 26).
The unemployment rate in February dropped to 5.5 percent from January’s 5.8 percent. The jobless rate has stayed between 5.4 percent and 5.8 percent since late 1994.
Of the 705,000 jobs added in February, 287,000 were in the service industries and 166,000 in the retail industry, reflecting the continued trend to a post-industrial economy.
The apparel industry in February employed 859,000 workers, down 3,000 from January and 92,000 fewer than in February 1995. The textile industry last month employed 633,000 workers, up 5,000 from January, but still 43,000 below year-ago levels.
The last month in which textile employment posted a gain was October 1994, when it added 3,000 jobs to 674,000. The apparel industry’s last job gain was in August 1994, when it also increased by 3,000 jobs to employ 972,000 workers.
The problems plaguing the apparel industry by now have become all too familiar. Manufacturers are struggling to cope with a weak retail market, a continued increase in imports and an overall restructuring of retailer-supplier distribution channels, said Carl Priestland, an economist with the American Apparel Manufacturers Association.
Probably the most puzzling aspect to apparel makers, said Priestland, is the ongoing reluctance of consumers to spend, reflecting uncertainty over job security despite low interest rates, a growing economy and low unemployment. The chance of a third federal government shutdown this week due to another standoff over the budget by lawmakers and the administration isn’t helping matters, he said.
“The message the economy, Congress and the White House are sending consumers is so confusing,” said Priestland. “I think they are shell-shocked. They don’t know what to do.”
Don Ratajczak, director of the Economic Forecasting Center at Georgia State University in Atlanta, said the February increase in textile employment was largely due to workers returning to their jobs after being shut out of mills during the January blizzard.
Nevertheless, Ratajczak said there appears to be some evidence textile orders — on the decline for several months — are strengthening. That should bode well for industry employment, although he said mill executives with whom he has talked aren’t all that optimistic about the market improving.
The executives said they plan to continue their “rolling adjustments,” the industry term for periodic factory shutdowns, he said.
“We have seen textile inventories plunge at apparel makers, which would suggest an increase in orders in the future,” said Ratajczak, adding this could be a sign that “the worst is over” for textile mills.
Further evidence of strength in textiles was the industry’s average work week in February, which increased to 40.9 hours from January’s 36.1 hours, but was still below February 1995’s 41.9 hours. A manufacturer typically increases the work week before adding employees.
The average work week for apparel makers also improved in February, increasing to 37 hours against January’s 33.3 hours. In February 1995 the work week was 37.7 hours.
In the retail sector, the new jobs were primarily in eating and drinking establishments. Department stores added 59,000 workers on a seasonally adjusted basis against February, to employ 2.24 million workers, a 24,000 increase from February 1995. Apparel and accessories stores last month added 3,000 workers to employ 1.08 million, which is 38,000 below February 1995.
The monthly gain in department store and apparel and accessories store employment largely reflects statistical changes for seasonal adjustment rather than a hiring stampede in the industry, said Katharine G. Abraham, commissioner of the Bureau of Labor Statistics, in testimony before the Congressional Joint Economic Committee.
“There were fewer than expected layoffs in January and February following weak holiday hiring,” Abraham said, explaining the vagaries of seasonally adjusting the numbers.
— Fairchild News Service

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