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Not Enough US Workers to Push “Made In US” Initiative

The snowballing emphasis on home-grown products that proudly display a “Made in America” label is running into a bevy of practical impairments, not the least of which is a lack of native labor.

As reported recently in the New York Times, a dearth of skilled labor in the U.S. has made it tough for companies to re-shore their manufacturing back to American soil. The reduced supply of labor has hit the apparel industry particularly hard, inducing a sharp increase in wage inflation for cut-and-sew workers, who have seen their compensation spike 13.3% between 2007 and 2012.

Take Minneapolis as an example. While the city employs more than 1.75 million workers a meager 860 have jobs as machine sewers, a paltry fraction of the nationwide total of 142,000. Speaking to the New York Times, Airtex Design Group Mike Miller said, “The sad truth is, we put ads in the paper and not many people show up.”

In response to the difficulty of finding qualified garment workers, Minneapolis has started an aggressive initiative of recruitment, scouring community centers, churches, high schools and launching advertisements in several different languages to reach the immigrant populations. Some organizations have even formed cooperative consortia to provide basic job training; apparently, if you can’t locate skilled labor you can create it.

More than a matter of patriotic sentiment, the rush to move manufacturing back to the States is propelled by a desire to seek alternatives to increasingly expensive destinations like China and cheap but troubled countries like Bangladesh. Wal-Mart has been a leader in boosting American manufacturing, committing to buying more than $50 billion worth of U.S. goods over the next decade. It has also fronted an assemblage of more than 500 U.S. companies that intend to repatriate a considerable chunk of manufacturing work they have outsourced overseas.

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Further, many retailers have complained the one major obstacle, somewhat paradoxically, to bolstering the Made in the USA movement has been the U.S. government. Just recently, the leading sneaker retailer New Balance started lobbying the Pentagon in the hopes that it would win an exclusive contract with the armed services. There are well over a million active-duty soldiers in the U.S. military and all of them are mandated to run for exercise, and by extension, own running sneakers.

As it stands today, the Pentagon permits each of the armed services to make their own decisions about where to buy the sneakers they provide to their soldiers. The Pentagon is historically reluctant to cede its purchasing power or to enter into any exclusive contractual arrangement with a retailer, since that would potentially limit its bargaining power regarding prices.

Technically, the Pentagon is legally bound to buy food, clothing and a host of other items from US. producers, an interdiction detailed in the 1941 statute called the Berry Amendment. Matt LeBretton, a spokesman for New Balance, said, “We have not been quiet about our desire to the see the department to follow its own rules. Soldiers don’t have a choice for most of the gear that they’re given, so I don’t know why it would be different for athletic footwear.The administration talks a lot about supporting domestic manufacturing – here’s an opportunity to do it.”

There is currently no univocal policy regarding the purchase of non-uniform apparel. In order to avoid stockpiling huge inventories, each of the armed services provides a stipend to soldiers to purchase their own. For example, the Army gives male soldiers $75 per year to spend on shoes, and permits them to spend that on whatever brand they please. The Air Force dispenses about $2.3 million a year on shoe allowances.

The Navy is the only branch that limits the spending of its soldiers’ allowances to a specific brand: New Balance.

There is no lack of consumer enthusiasm for a Made in America push, provided that prices can be kept comparably low. However, a superabundance of interest seems unsupported by the necessary manpower, and maybe the active support of the government as well.