Textiles & Apparel

Workers & Jobs

Structural Economic Change and High Unemployment

North Carolina's economy continues to restructure away from traditional manufacturing industries like textiles, apparel, tobacco, furniture and paper. Since 1992, when textile production represented 16 percent of total manufacturing output in North Carolina and apparel production represented just over 4 percent, both sectors have seen a steady decline down to about 9 percent and just over 5 percent respectively in 2001.1 Over 871 textile and apparel mills have closed down since 1996(see Table 2a). Between 1977 and 1997, nearly 82,000 jobs were eliminated in the NC textile industry.2 This downward trend has accelerated since 1996, with over 150,000 textile jobs lost between 1996 and 2006. Over 48,027 apparel jobs were also lost in the same period (1996-2006)3 Not surprisingly, North Carolina recorded a high unemployment rate at 6.5% in 2003, ranking 41st in the nation. The state's annual unemployment rate has consistently been higher than the national average since 2001. In January 2006, 15 North Carolina counties had unemployment rates more than 2% above the national average of 4.8%, all of them rural.4 In particular, Hyde County had the highest unemployment rate in January 2006, at 8.9%.5

Out of Work and Still Looking

The consequences of layoffs have been devastating to workers, who mostly reside in rural areas. Many textile workers have spent over 30 years in these industries, and have found readjustment difficult. A recent study by the NC Employment Security Commission has shown that of the people laid off in 2001, only 59% found work one year later, and just 62% found work two years later. Of those who did find work, over 60% earned less than 90% of their pre-layoff wages.6 This finding is consistent with previous studies conducted in the late 1990s that only 74% of laid-off workers were reemployed after two years, with the median wage of these workers being only 88% of their pre-layoff median wage. This trend is exacerbated for older workers (over 55 years old), with findings in two studies in 1995-96 and 1997-98 that 50-60% of displaced workers found work after two years, with those who did find jobs earning only 78% of their pre-layoff wages.7 This has meant that many people have exhausted their state unemployment benefits without finding a new job. In 2003, this figure reached 142,000 people.8

Low Educational Levels and System Pressures

A significant concern remains the fact that many former workers do not have a college degree and find it difficult to compete for good, high-paying jobs. As of 2004, only 22% of rural residents have a college degree and it is estimated that 27% of rural workers do not have a high school education.9 This situation is compounded by two systemic pressures, the first being educational system capacity and the other being population growth. Community college enrollment increased 27% from 1997 to 2002, with basic skills enrollment for adults without a high school education or poor skills, increasing 33% during the same period. For the school year 2005-2006 the system had 801,676 students with 17% of students representing those with basic skills enrollment.10 However, the community college system is undergoing a period of fiscal austerity and one of its key financial sources - the Unemployment Insurance Fund - has seen its value halved during the record payouts in 2001, leaving less money available to support the community college system to purchase new technology and equipment or continue many of its training programs.11 The 21% population increase from 1990 to 2000 (6.6 to 8.0 million) has put pressure on job creation efforts within the state. Net migration has been the primary cause of this increase, accounting for over 70% of the increase, especially Hispanic migration which exploded 394% to almost 400,000 Hispanic residents (4.7% of the NC population).12

Community Devastation

Many small communities depend on the textile and apparel industry for survival. Historically, many towns in North Carolina grew around textile and apparel plants, relying on them to not only provide employment, but also for a significant part of property tax revenues to pay for services and amenities like water, sewage, parks, housing, education, etc. For example, Valdese in Burke County is located in western North Carolina and has suffered from the worker layoffs caused by textile plant closings. The loss of water and electricity utility revenue led to a $500,000 shortfall in its utility fund and would need a minimum 20 cents increase in property taxes to cover the water and sewer costs alone, which would of course cut into the incomes of many town residents, who are now unemployed.13

Textile and Apparel Industry Occupational Patterns

In the apparel sector, five occupations account for just over half of all employment, with sewing machine operators making up over 40 percent of all employment in the industry.

Table A. Occupational employment & mean annual wages in the apparel industry, 2006

Source: Data from Bureau of Labor Statistics, National Industry-Specific Occupational Employment & Wage Estimates

In the textile sector, thirteen occupations account for about 53% of textile employment.

Table B. Occupational employment and mean annual wages in the textile industry, 2006

Note: These figures are calculated using statistics from NAICS Codes 313 and 314. Source: Data from Bureau of Labor Statistics. National Industry-Specific Occupational Employment & Wage Estimates

It is hoped that many of the skills used in the occupations above can be applied elsewhere. A 2002 South Carolina Employment Security Commission report14 noted that:

"Operating textile machines requires a variety of skills that may be transferable to other industries such as the following:

• Fabricated Metal Products
• Industrial Machinery and Equipment
• Chemicals and Allied Products
• Electronic and Other Electrical Equipment
• Trucking and Warehousing
• Paper and Allied Products
• Transportation Equipment
• Wholesale and Retail Trade"

References

1. Patrick Conway, Robert Connolly, Alfred Field and Douglas Longman, "The North Carolina Textiles Project: An Initial Report," Journal of Textile and Apparel, Technology and Management, Vol. 3, Issue 3, Fall 2003. p. 2. Last accessed August 13, 2007. [http://www.unc.edu/~pconway/Textiles/nctp_tatm_rev.pdf]
2. Patrick Conway, "Charting Employment Loss in North Carolina Textiles," Unpublished paper, January 14, 2004. Last accessed August 15, 2007. [http://www.unc.edu/~pconway/Textiles/emplevol.pdf]
3. Ibid.
4. North Carolina Employment Security Commission, Employment and Wages by Industry. Last accessed August 14, 2007. [http://www.ncesc.com]
5. Ibid.
6. North Carolina Rural Economic Development Center (NCREDC), " Manufacturing Jobs Continue to Decline," North Carolina Rural Economy (Raleigh) , Vol. 3, No. 3, Summer 2004. Last accessed August 15, 2007. [http://www.ncruralcenter.org/news/ncreconomysummer.pdf]
7. NCREDC, "Manufacturing Layoffs: Hard Times for Rural Factories, Workers and Communities," No. 11, April 2002. Last accessed August 15, 2007. [http://www.ncruralcenter.org/pubs/mfglayoffs.pdf]
8. NCREDC, "Manufacturing Jobs...".(fn. 6).
9. NCREDC, "Manufacturing Layoffs..." (fn. 7).
10. North Carolina Community College System (NCCCS), NCCCS Annual Statistical Report 2005-06, Raleigh, NC: NCCCS, 2006. Last accessed August 14, 2007. [http://www.ncccs.cc.nc.us/Statistical_Reports/collegeYear2005-2006/annual/ann0506.htm]
11. H. Martin Lancaster, "Remarks by H. Martin Lancaster, President of the North Carolina Community College System," North Carolina Workforce Development Summit, Greensboro, NC, February 28, 2002.
12. NCREDC, "Manufacturing Jobs...".(fn. 6, pp. 9-10).
13. NCREDC, "Manufacturing Layoffs..." (fn. 7).
14. South Carolina Employment Security Commission, South Carolina Workforce Trends, May 2003 Special Edition. Last accessed August 14, 2007. [http://www.sces.org/lmi/whatsnew/TEXTILE.pdf]