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U.S. Textile Industry Unraveling.

Article Excerpt
Jeffrey Sparshott has worked as a reporter covering international business in Warsaw, Poland, and local government at newspapers in New York state. In addition, he has worked on trade and economic policy issues at the U.S.-Mexico Chamber of Commerce. Currently, he covers international trade for The Washington Times.

Steve Dobbins in the past four years has closed ten plants, laid off fourteen hundred workers, and refocused his textile company on products that won't go toe-to-toe with competition from lower-cost factories in China, India, and a handful of other nations. But he's still not certain that Carolina Mills, a company that today employs twelve hundred in a thirty-mile radius around the small North Carolina town of Maiden, will survive a massive change in the clothing and textile markets that began January 1. "We're busting our cans trying to find ways [to compete]. We don't know whether or not we will succeed, but we are trying," said Dobbins, the company president.

Foreign competition has been creeping up on U.S. companies that spin yarn, weave fabric, and sew clothing. The industry has adjusted by consolidating, scaling back U.S. operations and refocusing overseas.

Many believe the worst is yet to come. Starting last January 1, a global system of quotas that limited foreign apparel sales to U.S., European, and other wealthy markets since the 1960s expired. China is expected to capture about 50 percent of the U.S. clothing market, up from 16 percent, in the new no-quotas era, the World Trade Organization estimates. India and a handful of other countries also are expected to prosper. Their gains are expected to come at the expense of companies in the United States, Europe, and smaller, less-efficient countries, such as Mexico, Turkey, and Indonesia.

Companies in the United States have been preparing on several fronts-- sometimes making internal changes to become more competitive, but also petitioning the government for a new round of protection. Dobbins' company has become more automated, refocused on high-tech threads that go into branded products, such as Polartec fleece and Coolmax socks; "made in the USA" goods sold to the government, such as flags; and high- end segments, such as medical bandages.

Still, the future is uncertain. "At the end of the day,...

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