THE STATE : THE GARMENT INDUSTRY : Beyond Unions and Slave Labor

Long ignored and frequently disdained, the Southern California apparel industry has suddenly gained a notoriety it would happily forsake. Recurring reports about violence and labor-law abuses in the nether world of sewing contractors have bolstered claims that Los Angeles’ top manufacturing industry is little more than a Third World sinkhole. The reports of near-slavery conditions at some sweatshops have even prompted officials to muse that the region would be better off without the industry. Yet, the loss of this vital and growing industrial sector--now Los Angeles’ largest--would be a disaster for Southern California.

Immigration, low wages and poor working conditions have long been associated with the garment trade. Until the 1860s, the “rag trade” was largely a custom-made business run by tailors and other craftsmen. Mass-produced “ready to wear” garments were the creation of London-based Jewish entrepreneurs who learned the needle trades in the cities and shtetls of the Russian and Austro-Hungarian empires.

Earlier this century, the enormous wave of Jewish migration to the United States shifted the locus of the apparel industry to New York City. Jews predominated from top to bottom, constituting the bulk of the manufacturers, contractors and low-wage workers. More than merely the product of market forces or low wages, the New York garment industry reflected the energy--as well as the suffering--of the city’s Jewish community. Working conditions were often hazardous--and even after unionization, far from plush--but the industry provided many Jews a ladder for upward mobility

Initially, the L.A. garment industry grew out of a secondary migration of Jews from New York and elsewhere to the West Coast. But by the 1970s, a huge wave of immigration from Latin America, the Middle East and East Asia transformed a onetime fashion backwater into the nation’s top garment- and textile-producing region.

Even as foreign competition was eroding garment jobs throughout most of the country, the apparel industry in Los Angeles continued to grow. During the past decade, the local industry added more than 30,000 jobs, while total revenues nearly doubled.

Low wages paid to immigrants, particularly illegal ones, are often cited to explain this growth. But such an explanation overlooks the peculiar cultural character of the industry. As in turn-of-the-century New York, Los Angeles’ apparel industry has been driven by special types of entrepreneurs, in particular, by North African Jews, Persians, Koreans, Chinese and Israelis, who drifted toward the emerging cosmopolis by the Pacific.

Today, much of the Los Angeles industry is dominated by these newcomers. Bugle Boy, for example, is owned by Chinese entrepreneurs; Guess, Bisou Bisou and BCBG were all founded by immigrants from North Africa. And like their Jewish counterparts in early 20th-Century New York, many of these immigrants are using the apparel trade as a means of moving up. About 60% of the students at the Fashion Institute in Downtown Los Angeles, a primary training ground for design and marketing professionals, are minorities, almost twice the percentage of a decade ago.

Yet, the longstanding problems of sweatshop conditions have remained, and arguably worsened, in both Los Angeles and New York. Many reasons are given for this lack of progress--the weakened state of unions, large numbers of undocumented workers, lax labor-law enforcement and ferocious price competition within the industry.

The presence of a large, underpaid and sometimes abused work force threatens the industry’s political clout, even its economic future. With stores and manufacturers now under close scrutiny following the reports of slave-labor sweatshops, customers may be tempted to take their work elsewhere, most likely overseas or to the Southern states, where conditions are often far worse.

For Los Angeles, such a move would be economically disastrous. The downsizing of the garment and related industries would imperil upward of 100,000 jobs, from designer to seamstress. Thousands of the industry’s 4,000 companies--90% of which employ fewer than 50--would be wiped out. Large swaths of central and southern Los Angeles County, where the industry is concentrated, would be severely hurt.

Saving the region’s garment industry, while aiming to eliminate its worst abuses and gradually raise its wage rates, will require innovative strategies. The old method of unionization may be the sentimental favorite but it is unlikely to succeed in a global economy.

Indeed, in large part, the dominance of unions drove the garment and textile industry out of New York and into such traditional non-union settings as Florida, Texas and Southern California, where the union share rests below 5%. Increasing low-wage pressure from overseas, which was largely absent during the halcyon days of labor organizing, has undercut unions as an antidote to poor working conditions. Faced with the need for quick, flexible and timely production, even the best manufacturers feel they cannot endure rigid work rules and negotiating pressures associated with unions.

Equally important, the L.A. garment industry possesses a far more diverse work force--and employer base--than existed in the New Deal era. Organizing Korean, Chinese, Mexican, Salvadoran and Guatemalan workers into one union is a far more daunting task than that faced by 1930s organizers, whose work force and employer base shared a common cultural background.

But this is not to say that the only choice lies between a unionized industry, albeit a far smaller one, and rampant exploitation. In fact, employees in cutting-edge firms such as Judy Knapp enjoy wages, health benefits and working conditions comparable to those in electronics. Workers who start at minimum wage often end up making middle-class salaries as their skills improve.

Technological and marketing innovation also helps garment companies escape the sweatshop trap. French Rags in West Los Angeles, a 90-person knitwear maker, has invested heavily in new knitting machines and other technologies that allow its workers to achieve greater productivity, which enables their employer to pay higher wages. The average wage at French Rags is closer to $10 to $12 an hour, with full medical benefits.

A company’s ability to circumvent conventional retail chains--the source of much of the ferocious cost-cutting pressure that breeds sweatshops--by selling direct to consumers is another way to escape poor conditions. A host of leading area manufacturers, including Guess, have begun to set up their own retail outlets to keep a greater share of profits in the hands of those who design, manufacture and distribute the garments.

To push up margins throughout the industry, the entire apparel business needs to more effectively market itself. This is a primary mission of the newly formed California Apparel Assn. In the absence of common marketing strategy, too many L.A. manufacturers must compete solely on price, which tends to drive down wages.

L.A.’s garment manufacturers certainly need to police themselves more effectively against the danger of slave-labor sweatshops. But the media, academic and political elites also need to help the industry gain the recognition and qualitative improvements that will make the industry a source of pride, not shame.*