President-elect Donald Trump doesn’t need to look far to make good on his pledge to bring back American manufacturing.
Ivanka Trump’s clothing brand is manufactured in China and other Asian countries, as part of a licensing deal with G-III Apparel Group (GIII), which also manufactures clothing for Calvin Klein, Tommy Hilfiger and Jones New York. G-III says it operates offices in Nanjing and Qingdao in China, as well as Vietnam and Indonesia, employing more than 300 employees who work with local factories. G-III didn’t immediately return a request for comment.
Mr. Trump’s rhetoric about China, ranging from his claims on Sunday that the country manipulates its currency to his expressions of anger at U.S. companies that export jobs there, comes at a dicey time for Ivanka Trump’s brand, which has come under fire from anti-Trump protesters. While Mr. Trump has vowed to revive American manufacturing, he’s so far focused on companies like air conditioner maker Carrier, which had planned to shift jobs to Mexico.
How he might convince U.S. companies to return manufacturing jobs that have already shifted outside American borders remains a major question. Ivanka Trump’s brand could provide Mr. Trump with the ideal case for testing out how such efforts would play out. A spokeswoman at Ivanka Trump’s brand said the company is interested in the idea of reviving U.S. manufacturing, but the company declined to comment further.
“We have consistently expressed that we share industry leaders’ interest in bringing more manufacturing opportunities to the U.S. and are looking forward to being a part of the conversation,” the spokeswoman said.
Shifting manufacturing of Ivanka Trump-branded $100-and-up dresses and $400 faux-fur-trimmed coats to the U.S. would likely require her brand to find a new manufacturing partner with American apparel factories, or else to find a company willing to build new capacity to handle the work.
The problem? America has largely gotten out of the business of making its own apparel, with the American Apparel & Footwear Association noting that 97.3 percent of clothes sold in the U.S. are imported. It’s even worse for shoes, with 98.4 percent of footwear made by manufacturers based outside of the U.S.
The biggest source of Americans’ clothing: China. The country was responsible for $30.9 billion of imports to the U.S. last year, far outpacing any other country, according to data from the U.S. Commerce Department. During the same year, U.S.-made clothing only accounted for 2.7 percent of the U.S. clothing market, which is its highest market share since 2008 and represents what the American Apparel & Footwear Association called a “resurgence.”
Aside from the issues with finding manufacturing capacity in the U.S., there are the issues of cost. Consumer goods have largely declined in price during the past decade, or what Economic Policy Institute research and policy director Josh Bivens has called “one of the few good news stories” of the current American economy.
On an inflation-adjusted basis, apparel costs have declined 9 percent since 2006, according to data from the Bureau of Labor Statistics. Those lower prices are partly due to the longer-term trend of U.S. brands shifting their manufacturing to countries where labor is cheaper, such as China and Bangladesh. As a result, the number of jobs in the apparel industry slumped more than 80 percent between 1990 to 2011, the BLS has found.
Bringing apparel-manufacturing jobs back to the U.S. may boost employment for low-wage workers, but it would likely translate into higher costs on the clothing rack. For a taste of what the U.S.-made clothing would cost, look to New Balance shoes, which makes some of its shoes in American factories. While New Balance shoes that are made outside the U.S. start at $65, its American-made shoes start at $165, according to Business Insider.
Still, the American Apparel & Footwear Association CEO Rick Helfenbein said in an emailed statement that U.S. consumers are increasingly interested in buying “Made in USA” products.
“We’re very interested in what tools the Trump Administration will offer, to help the efforts of our many diverse members,” Helfenbein said. “It is our hope that commonsense regulatory initiatives, new tax policies, sound infrastructure investment, and strengthened trade policies will support and grow the 3.8 million U.S. workers employed throughout the competitive supply chains in our industry.”
Some Ivanka Trump clothing items are already drawing some criticism from Amazon shoppers about where offerings such as a $19 simple black dress are made, suggesting that her brand will need to walk a fine line between providing reasonable prices while navigating consumers’ interest in her father’s rhetoric about non-U.S.-made products.
“Made in China??” one reviewer wrote of a $134 Ivanka Trump dress. “Not what I was hoping for.”
[Source:-CBS]
