US workers add substantially to apparel imports –Study

The report, authored by trade economist Susan Hester, Ph.D, found that on average, 70.3 percent of final retail price of studied apparel is created by workers in the United States. Specifically, the global value chain for apparel relies on a full range of highly-skilled and highly-compensated American workers in blue-collar and white-collar jobs that contribute to the design, development, production, importation, distribution and sale of apparel in the United States.

Excerpts from the report:

“American consumers and policymakers tend to look at the finished apparel product and put it into one of two categories: imported or made in the Unites States. But the reality is that GVCs [global value chains] have made the simplistic judgment usually outdated and inaccurate.”

“Using proprietary data to document the dollars associated with each stage of the global value chain for apparel, this study found that the U.S. value added exceeded 70% for the 20 product-company garments studied.”

“Tariffs routinely applied to apparel imports result in higher prices for consumers. It is quite possible that removing these tariffs under a trade agreement would lower prices to consumers and thus increase demand and therefore jobs and profits all along the apparel global value chain including in the United States. Efforts to support these global strategies by American apparel companies will contribute to their success and growth, and these will in turn lead to a more competitive marketplace for apparel consumers and new high-quality U.S. jobs throughout the global value chain.”

The report, which studied a variety of apparel categories and companies, reinforces findings in another recent study evaluating the global value chain associated with the iPod, as well as a new value chain statistical database that was recently launched jointly by the Organization for Economic Cooperation and Development and the World Trade Organization.

Leaders of the Trans-Pacific Partnership Apparel Coalition weighed in on the report.

Kevin M. Burke, President and CEO, American Apparel & Footwear Association

“When we get dressed each day, we wear U.S. jobs. This new study offers valuable insight into the U.S. apparel industry’s positive economic impact on U.S. workers and the U.S. economy. It also sheds new light on the need for robust trade policies to move our industry forward in a 21st century competitive global marketplace.”