Worker Shortage Blamed on Uncertainty, Fear of Law : Amnesty Woes Snag L.A. Garment Trade

Times Staff Writer

The 250 sewing machines that normally are humming at the Cal-Art Sportswear factory in downtown Los Angeles are down to 160 because owner Rito Gutierrez has not been able to keep enough of his operators since the new immigration law went into effect. To make matters worse, he is having trouble recruiting replacements.

"I put an ad in the paper for three weeks. I never got a phone call," Gutierrez said. Five or six people came in looking for work, he added, but they did not have the proper papers to qualify for employment under the law.

"Right now, I'm turning down a lot of work because I can't get operators," Gutierrez said, sighing.

Confusion, fear and misinformation among immigrants seeking amnesty under the landmark immigration law passed last year are creating severe worker shortages for garment makers in Los Angeles, which is second only to New York as an apparel employment center. Many workers are quitting their jobs, and in some cases fleeing the United States, because of concern about their legal status, according to community leaders.

The immigration law, which grants amnesty to aliens who can prove continuous U.S. residency since before Jan. 1, 1982, and imposes sanctions on employers who knowingly hire illegals, was expected to create some labor shortages in local industries, ranging from retailing to agriculture, that depend on low-wage immigrant workers.

But the scale and the quickness of the shortages so soon after the law started being phased in on May 5 have alarmed employers. The problems come even before the employer sanctions portion of the law is being fully enforced, although businesses are now required to check the legal status of new employees.

"I'm hearing complaints mainly in (apparel) manufacturing. They are feeling the crunch," says Antonio H. Rodriguez, an attorney with the East Los Angeles Immigration Project. "Nobody expected it to happen this soon."

Some executives in the hotel and fast-food industries, which heavily employ Latinos, said they have not yet felt the same impact. One reason, according to hotel managers, is that they attempt to hire only legal residents.

"I don't have a problem at this point," said Karl Schaefer, general manager of the Sheraton Grande in downtown Los Angeles.

More Problems Predicted

However, Maria Guzman-Kennedy, executive director of the Los Angeles-based Latin Business Assn., said problems for a number of industries are just around the corner.

"There has been a scare and a lot of people are leaving," she said. "There's a lot of confusion. . . . It's going to affect every industry."

In addition, shortages of farm labor have been reported in scattered areas of California. More serious problems have struck the Northwest, where some crops are rotting in the ground due to the lack of field hands.

Gutierrez and other sewing contractors are especially hard-hit because immigrants from Mexico had accounted until recently for 50% to 80% of their sewing machine operators. Most of those workers, they say, arrived after 1982, making them ineligible for legal residency under the new law.

What is more, the labor shortage hits the local rag trade just as contractors are poised to pick up some of their biggest new orders in years. Apparel production is returning to U.S. shores. "Made in the U.S.A." is the new buzz phrase among stores and apparel manufacturers.

Orders on the Rise

Orders for U.S.-made garments are on the rise largely because stricter quotas--imposed last summer on apparel imports from Hong Kong, Taiwan and South Korea--are making Asian imports more expensive. Delivery and production problems involved in bringing imported goods quickly to market, given today's fast-paced fashion market, also have worked in favor of U.S. manufacturers.

"The minute they say they'll come back to the U.S. to produce here, this (immigration bill) goes through and now people are running away because they are afraid," said Shelly Goldman, chairman of Monarch Knits, a 52-year-old Los Angeles manufacturer and importer. "Factories are now losing 50% of their help."

Factory operators in Los Angeles County last year employed about 82,600, or 73%, of the state's apparel workers. Employment experts say that through April, at least, the number was rising.

"If we're unsuccessful in making things here," said Roland de Aenlle, who has operated Yoko Fashions Ltd. of California for 19 years, "there will be a tremendous amount of pressure to raise quotas again, which will force goods back into the Orient or elsewhere. That's the biggest problem. It will leave manufacturers solely with imports from overseas markets and kill the possibility of creating more jobs."

If the shortage of workers continues, it could drive up wages and other costs for manufacturers, which ultimately will mean higher prices for U.S. shoppers.

Consumers Will Pay

"The cost in the end will be paid by you and me," said Juan Jose Gutierrez, executive director of One Stop Immigration and Educational Center of Southern California, a nonprofit group.

Some union officials complain that apparel employers are taking advantage of the confusion caused by the immigration amnesty law to keep down wages in an industry long associated with sweatshops. Employers, however, say wages are actually on the increase.

"In our dealing with employers, they are not experiencing shortages where the pay is substantially more than the minimum wage" and medical insurance and other benefits are offered, said Steven T. Nutter, western regional director of the International Ladies Garment Workers Union in Los Angeles.

"If you were to post a sign of $5 an hour plus medical insurance on Broadway, you wouldn't have a shortage of workers," he said.

Already, the voracious demand by U.S. consumers for new garments is driving clothing prices higher. In March alone, U.S. apparel prices rose 1.7%, the biggest one-month increase in nearly 13 years. So far, shoppers have not balked at the higher price tags.

Look to Philippines

So desperate are some Los Angeles-area contractors to keep the clothes pipeline flowing that they are considering hiring temporary workers from the Philippines. To do so, they would need federal approval.

"There are any number of firms going wanting for employees," said Ricardo Arciniega, whose Tery/Anne Inc. factory in South Gate is looking for 100 operators.

He has had a job listing at the Employment Development Office for 45 days, but the response has been weak, "maybe 15 to 20 people," he said.

"I hate to see this work go back offshore," added Arciniega, who has had to turn down work that would have kept his factory busy until the spring of 1989. "My guesstimate is that we've turned down a half-million dollars worth of business. There's no sense in taking something we can't turn out."

Gutierrez at Cal-Art Sportswear is producing 20,000 garments a week, only half of his plant's capacity. "This is costing me money," he said. "Our only hope is that the INS will soften their position and figure out some way for these people who came after 1982 to stay."

The federal agency will be unable to do so unless Congress changes the law, however.

One solution, factory operators concede, is to update and modernize their plants. But they fear that if they invest money in new equipment they may become victims of the crosscurrents of U.S. domestic and international policies.

'It's a Catch-22'

"I want to buy more equipment to reduce manpower," said De Aenlle of Yoko Fashions. "But if the business doesn't come here, I don't know if I'll have money to pay for it. It's a Catch-22 (situation)."

He already has two new machines, which cost $1,800 each, sitting idle because he cannot find operators. "Some of us are laying back not knowing what to do, watching these other guys who have made a commitment (to new equipment) squirm and suffer."

Historically, garment making has been an immigrant trade. The recent wave of immigrants from Latin America and Asia settling in Southern California has provided a vast pool of cheap labor for garment manufacturers. As a result, California has registered gains in apparel employment while the rest of the country has suffered declines.

Immigration experts working with Latinos said the exodus of apparel workers is the result of uncertainty and lack of trust in the amnesty-qualification procedures established by the Immigration and Naturalization Service.

Gutierrez, of the One Stop Immigration and Educational Center, said immigrants are largely an "illiterate population that have been very fearful of the INS. . . . Everyone is telling them the procedure is very simple, but when they try to do it themselves they find it is very complicated."

Returning to Mexico

Amid the frustration, many are choosing to stop working and return to Mexico, said Rodriguez of the East Los Angeles Immigration Project. He said the Mexican government reports that the population in the Mexican state of Chihuahua along the Texas border has risen 200,000 since January.

Even among those staying in the United States for now, Rodriguez said, "There is a drop in the number of people looking for a job because folks are finding it extremely difficult to find a job. Workers are coming in here saying they can't get a job unless they have a work permit. Until that day, they just lay off the labor market."

In addition, Los Angeles immigration lawyer Josie Gonzalez said, the actual number of aliens who qualify for amnesty may be far below government predictions. The unanticipated slow pace of those registering for amnesty tends to confirm this theory. "I think that's the bottom line," he said.

Meanwhile, some workers who qualify for legal residency are discovering that they are worth more in the tight job market. At the bottom of the pay scale, wages are up to $4 an hour in some cases from the legal minimum of $3.35. Most employees are paid on a piecework basis, however, and earn as much as $10 to $12 an hour.

"People are feeling more at ease to move about for a better wage," Arciniega said. "I lost two good zipper setters who were making darn good dollars. They got their act together . . . and went on to happier hunting grounds."

Staff writer Ronald L. Soble contributed to this article.

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