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Double-digit unemployment? These firms can’t find workers

Marketplace Contributor Dec 24, 2011

LOS ANGELES–When local fashion firm Pinup Girl Clothing tried to ramp up production of its vintage-inspired apparel recently it hit a snag: It couldn’t find anyone to do the work.

The company spent a year trying to add 12 people to its 32-person manufacturing team in downtown Los Angeles. As the search dragged on, Pinup Girl fell two months back in its production schedule.

“There just aren’t a lot of people out there who have the skills that we’ve been able to find easily elsewhere in the world,” says Laura Byrnes, Pinup Girl’s founder. “It’s still a problem for us,” she says, adding, “Most of the sewers that you do find working are still in countries like Mexico, Honduras, Guatemala where there are still sewing factories.”

Pinup Girl’s problem illustrates one of the puzzle’s of today’s slumping labor market. Unemployment in Los Angeles County, for example, has been stuck at or above 12 percent for more than three years. California has the second highest unemployment in the nation at 11.7 percent, after Nevada’s 13.4 percent. But as some industries try to expand, they’re bumping up against a workforce that lacks the right training. Even in a city with legions of unemployed, some firms still can’t fill spots for good-paying jobs.

Tens of thousands of sewing jobs fled to Asia more than a decade ago, attracted by low labor costs and booming supply. The rampant outsourcing sparked a sharp decline in job prospects for highly skilled textile workers. In 1996, apparel manufacturing in Los Angeles Country employed 105,00 people. In 2009, that number had fallen to 48,000.

But lately, many clothing manufacturers have begun to shift more production back to the United States. Producers say that rising labor costs in China have made American factories more competitive. And in the fast-moving fashion industry, making something locally allows a label to stay on top of new clothing trends and keep a closer watch on quality.

“I’d say in this past year there has been this migration back towards making products here again,” says David Perry of the DSP Group, which does consulting for the textile industry. “Quick turnover is a big reason to bring it back home.”

Clothing makers say they are under increasing pressure to get new designs onto store shelves as quickly as possible. That makes producing overseas more difficult. “The beautiful thing about manufacturing here is that if you order locally you can get a 30-day turnaround,” says Richard Abdelkader, vice president of sales for Los Angeles-based Nine Planet Jeans.

But what should be a bright spot for the recession-wracked region has instead become a headache for an industry that’s trying to grow.

“It is challenging to get people for these manufacturing positions and many of these positions do require skills,” said Kent Smith, executive director of the LA Fashion District, a local industry group. “On the creative side, we still have an incredible amount of talent, but in terms of mass-producing we definitely do not have the labor infrastructure for that.”

Part of the problem stems from the fact that few Americans are trained in sewing skills. That has left factories dependent on immigrants who learned the trade in their home countries. When sewing jobs began to dry up a decade ago, many talented workers left as well. Now that the jobs are returning, factories are finding that the workforce they once relied on bolted a decade ago.

“When the manufacturers left for Asia, the workers left for South America,” says Carlo Gholami, chief executive of the downtown-based Couture, The Clothing Company, which has produced mens’ fashion and costumes for the film industry for two decades.” Sure, you can find decent technical workers, but it’s just not as easy to come by the high-skilled workers as it was, say, in the late 90s or early 2000s,” he says.

In 2009, Gholami was asked to design costumes for the comedy film “Year One.” To complete the project he knew he would need to recruit extra help. That’s when he realized just how limited the pool of skilled workers was. “We were looking for just six or seven people at the time and we had an impossible time finding them. I have another project coming up soon and I’m just dreading the search for new help,” says Gholami.

Perhaps no company has been more severely affected by the changes in the labor market than Los Angeles clothier American Apparel. In 2009, a 17-month probe by U.S. immigration authorities ended up forcing the company to layoff 1,500 employees – about 25 percent of its workforce – whose legal presence in the country couldn’t be verified. The company has been struggling to recover ever since.

“Laying off a quarter of the factory workers, a majority of whom were highly skilled employees, was a major blow to the company’s ability to meet production goals,” said Peter Schey, lawyer for American Apparel. “The company was recruiting aggressively at the time, distributing leaflets at churches, placing ads on the radio and what we found is that there are just very few skilled workers available for hire.”

Many designers now believe that the industry won’t be able to grow significantly unless immigration restrictions begin to loosen. “Who is going to do the work?” asks Ilse Metchek, executive director of the California Fashion Association. “The immigrant labor force has always been an integral part of manufacturing here in the U.S., and without them it will be tremendously difficult to get U.S. manufacturing going again,” she says.

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