Lures 60 Firms From 12 Countries : South Carolina Mill Town Weaves a New Economy
All over the South, textile-manufacturing towns are being ravaged by the competition from low-cost foreign goods. Plants stand silent and shuttered; out-of-work mill hands search in vain for jobs; local businesses watch trade dwindle away.
Textile mills are also the dominant employer in this community in the rolling Piedmont country of northwestern South Carolina. They provide one out of every five jobs in the area.
Yet Spartanburg, with a population of 45,800, presents a picture of a city with a bright future.
Office and business construction here and in the surrounding county (population 205,000) is booming at a record pace. The unemployment rate is lower than the state and national averages, and mills that have been forced to shut down have been rapidly converted to other commercial uses.
Spartans, as residents of this 154-year-old city are called, say the reason for the difference here is no big secret. They caught the drift of the textile industry years ago, and have made a civic religion of going out and grabbing other businesses to replace the lost textile jobs--especially businesses from overseas.
Over the last two decades, Spartanburg has wooed and won more investment from abroad than any other U.S. city of its size: more than 60 firms from 12 countries, representing a total investment of more than $1 billion and employing 7,000 people in the area.
Together with new domestic investment, the foreign businesses have more than offset the loss of 3,000 textile jobs in the area over the last five years.
One foreign firm that was persuaded to set up shop here in 1981 is a Japanese manufacturer that is one of America’s biggest rivals in the textile market. In typical Spartanburg fashion, it has done so well that it recently doubled its weaving operation.
Nevertheless, Spartanburg doesn’t want to see any more of its home-grown manufacturing lost to foreign competitors. And Spartans--who made this year’s “Textile Week” an all-American tribute with hot dogs, apple pie, Ferris wheels and a display of the latest American-made cars--overwhelmingly support measures pending in Congress to curb imports of textiles and clothing.
Spartans, however--in the spirit of their Colonial ancestors, who formed the Spartan Rifles regiment for which the town is named and defeated the redcoats at the battle of Cowpens in 1781--are not willing to wait for someone else to save them.
“We could have been as devastated as some of those other places,” said Ruth Calvert, economic development manager for the Spartanburg Area Chamber of Commerce. “We’ve had our share of layoffs--even in the high-tech firms. We’ve had shutdowns. But we realized as far back as the 1973-74 recession that we could not rely on textiles forever and needed to make a determined effort to bring in other industry.”
“Spartanburg has certainly been a community that saw the light early and has been taking some very aggressive action,” said Jeffrey S. Arpan, international business professor at the University of South Carolina in Columbia, the state capital. “In fact, it was one of the first areas to actively go after foreign investors--even before the state itself got into the picture.”
International Flavor
Foreigners are delighted with the international flavor that Spartanburg has acquired under the impact of the overseas investment boom.
There are so many German and Swiss flags flying along Interstate 85, the main industrial corridor, that local residents call it “the Autobahn.”
The Holiday Inn, at the junction of I-85 and I-26, prints its emergency fire directions in five languages.
At the downtown civic auditorium, the holiday calendar features celebrations on Bastille Day, Swiss Independence Day and Oktoberfest. And the Spice of Life, a gourmet shop and restaurant nearby, offers a potpourri of imported wines, coffee, tea, cheeses, spices, baked goods and chocolates.
“I’ll never forget the little old British lady who was so relieved to know that she could buy Lyles Golden Syrup here and wouldn’t have to send home for it,” said Maria McCall, who owns the shop with her husband, Pat, a former textile company planning manager.
Personal Attentions
Another strong point in Spartanburg’s favor is its mastery of the little touches and personal attentions that can often mean the difference between winning and losing a contract.
Motoaki Yumoto, vice president of Alcoa Fujikura Ltd., a joint venture of Pittsburgh-based Aluminum Co. of America and Japan’s Fujikura Ltd., offers a case in point.
He had been wooed by many another community eager to land the $20-million, high-tech optical fiber plant that Alcoa Fujikura was planning to build in the United States. Spartanburg swept him off his feet.
The Japanese flag was flying over the downtown Chamber of Commerce building on his arrival. His daughter, a soon-to-be university graduate, was housed with local families and given a personal tour of the area’s historical attractions.
Face on Billboards
Even now, with Yumoto safely bagged and the plant construction nearing completion, Spartanburg hasn’t turned off the charm. The Chamber of Commerce recently selected him to appear in the nationwide advertising campaign for the its new economic development program.
Soon, he acknowledges with obvious delight, his face will be beaming down from airport billboards at travelers in Atlanta and several other major cities.
Spartanburg needs the billboards effort. From now on it is likely to find the pursuit of foreign investors tougher, because the field has become crowded with imitators eager for similar success.
Atlanta Mayor Andrew Young, for example, is using connections he gained as United Nations ambassador during the Jimmy Carter Administration to help lure foreign business to his city. Young has paved the way for millions of dollars of overseas investment in Atlanta.
Globe-Trotting Governors
In Tennessee, Gov. Lamar Alexander has led eight trade missions to Japan, with impressive results. Tennessee has 10% of all the Japanese investment in the United States so far.
The Frost Belt, home to an earlier wave of businesses that invested in Southern mill towns, also sends out globe-trotting governors. Illinois Gov. James R. Thompson routinely visits Japan, and once headed an entourage of 160 top government, business, labor and academic leaders from his state on a mission to China. It was the biggest state delegation ever to visit there.
Spartanburg persuaded its first foreign firm--Rieter Machine Works Ltd. of Switzerland--to settle here in 1962. Rieter was soon followed by another Swiss company, Sulzer Brothers Ltd., and then by Menzel Machine Works of West Germany.
By design, Spartanburg selected its early foreign businesses from among those that could serve or supply the area’s textile industry.
Today, the international concerns here include Hoeschst Fibers Inc., a unit of the Frankfurt-based chemical giant Hoeschst AG and a leading world supplier of polyester products, the Michelin tire company of France and Hedwin Corp. of Belgium, a manufacturer of plastic shipping containers.
‘Five Solid Prospects’
“We have five more solid prospects in West Germany who are just waiting for the dollar and the mark to be in a more advantageous position before they move here,” said Calvert, the chamber’s economic development manager and a prime mover behind Spartanburg’s investment boom.
“All together, they would employ anywhere from 800 to 1,000 local workers and their total investment would be, very roughly, around $70 million to $100 million.”
Calvert also noted that of the more than 60 international firms that have moved here, only three have left. Two West German firms closed after their parent companies failed, and a Danish concern moved to Ohio to take advantage of cheaper quarters.
If Spartanburg has taken to foreigners, the foreigners have also taken to Spartanburg. They have moved easily into every aspect of the community: schools, churches, clubs, cultural activities and sports.
Congenial Life Style
Jacqueline Dietrich, French consul for North and South Carolina and owner of a local gourmet French restaurant, Le Bistro, is among those who find the Southern way of life congenial.
“I am from the south of France, and southern France or southern United States, we are all Southerners,” she said. “I even stand up when they sing ‘Dixie.’ ”
Yet with all its success in attracting business, domestic as well as foreign, Spartanburg still seems to have as much trouble as most other U.S. cities in getting the benefits to trickle down to those at the bottom of the economic heap.
The unemployment rate among blacks, who make up 20% of the area’s population, is twice the rate among whites. Blacks also share little political power.
Fighting for Better Jobs
“We’re fighting to get better jobs for blacks and for women in local government,” said Sallie Peake, the first black member of the Spartanburg County Council. “All we have now are the mediocre jobs, not the executive positions.”
Finding jobs for displaced textile workers who face barriers of age, education and motivation in high-tech firms is another seemingly intractable problem.
The biggest question mark hanging over Spartanburg, however, is the future of the textile industry itself.
From a technological standpoint, the industry here--as elsewhere in the nation--has undergone a dramatic transformation in recent years. The old mill rooms filled with clouds of cotton dust and the cacophony of clacking shuttle looms are a thing of the past. Now, high-speed looms weave with jets of air while powerful vacuum hoses mounted on ceiling rails remove lint from the air.
Automated Industry
“We’re probably the most automated industry in the nation next to semiconductors,” said C. Hunter Gallman, senior vice president of M. Lowenstein Corp. and president of the state textile manufacturers’ association.
“Nationwide, the industry has spent about $1 billion a year for the past several years, and last year it was more than $2 billion. At our own little company here, we’ve spent $125 million in the past five years.”
Despite all of the modernization, industry spokesmen contend that domestic textile manufacturers could easily go the way of the U.S. shoe industry unless Congress acts to roll back the tide of imports. Foreign-made shoes now command 70% of the U.S. market.
“We’re not trying to keep imports out altogether,” said Walter Montgomery, chairman of the 97-year-old firm of Spartan Mills. “We just want them pushed back to the levels that were agreed upon by international treaties. The Administration hasn’t been enforcing those agreements, and we’re being taken advantage of by foreign manufacturers.”
Impact of Imports
One measure of the devastating impact of imports is the laying off of 300 employees at Spartan Mills.
“We’ve never had to lay off our people in our history, even during the Depression,” Montgomery said.
Even in the best of circumstances, most textile makers agree, the industry will never return to the days when it employed more than half the area’s labor force. For that reason, the textile manufacturers in and around Spartanburg are among the biggest boosters of the Chamber of Commerce’s economic development plan.
That plan sets a goal of $770 million in new investment, representing 8,000 new jobs, by the end of 1988. Industries the area is seeking to attract include printing and publishing, robotics and automation, banking and equipment-leasing companies.
“Spartanburg absolutely must diversify its economy further,” said John Rampey, vice president of Milliken & Co., a large, family-owned textile firm.
“We’re just very fortunate that we’re not one of the little towns where the mill is all that they had and now it’s gone.”
