And the new company name is Chinese Apparel, just kidding.
American Apparel, the maker of hip clothing and accessories laid off over 500 workers, after going through a bankruptcy reorganization.
Every week, you see companies laying off workers, yet the employment rate continues to go down according to some. I don’t understand their numbers game.
Reading a couple articles about companies downsizing and then questioning the whole employment picture is about the same a looking out your window and saying, “Geez it’s cold outside so global warming can’t be true”
Chief Executive Paula Schneider wrote in a letter obtained by the Times in which she said a mismatch between workers and manufacturing was an inefficiency that needed to be addressed as part of the company’s turnaround efforts. She added that the move came after “months of careful and rigorous review.”
The retailer will also cut down on the number of garments it makes throughout the year, to clear inventory.
CA's $15 Min. Wage Ends American Apparel Industry Revival https://t.co/9mv5SBjQbR 500 people terminated in one shot…just the beginning.
— fubaglady (@fubaglady) April 18, 2016
The company did not tie the announcement directly to California Governor Jerry Brown signing of the nation’s first statewide $15 minimum wage on April 4. But the layoffs started shortly almost immediately after Brown’s action, and were announced on April 14 as labor organizers filled Los Angeles streets with fast-food workers set to strike, supported by unionized home-care and child-care workers.
Lloyd Greif, Chief Executive of Los Angeles investment banking firm Greif & Co.told LA Times, “They’re headed out of Dodge.” He added, “They are going to outsource all garments. It’s only a matter of time.”
At the turn of the 21st Century, Los Angeles County was the “rag trade” capital of America. With 4,000 active apparel-making sites employing almost 90,000 workers, the Los Angeles area was over twice the size of the rag trade in the New York region.
Apparel-making got cut in half over the next decade, as Chinese and Asian imports coming through Los Angeles ports sky-rocketed to $46 billion. The number of local apparel-making sites fell to 2,200 and local industry jobs shriveled to 46,000.
It is impossible for even minimum wage earners in Los Angeles to compete with third world country manufacturers of clothes. However, each one of us pays dearly for those clothes as our taxes pay for welfare for workers who once had middle-class jobs making those clothes.
Okay American Apparel has been in bankruptcy for over a year now where is the huge blowout sale I've been waiting for hmmmm??
— marsh (@mxrlow) April 16, 2016
— American Apparel (@americanapparel) April 15, 2016
It’s only a matter of time before “outsourced” becomes off-shored. Corporations and elite stockholders win, rest of us lose. A shame.
Do you believe California’s $15 minimum wage hike caused the layoffs? Do you think inexperienced workers with no motivation for higher earning pay should be paid $15 an hour? Share your opinion (below) and let us know what you think.