History
People: A Long-term Problem For Apparel Manufacturers
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In 1974, the early days of outsourcing apparel manufacturing, Karl K. Striegel, Chairman of the Board at Kurt Salmon Associates (KSA), described one of the industry’s key challenges in his commentary for The Needle’s Eye June-July edition back then. And more than 50 years ago, he identified the tools and methods needed to address the problem. [KSA in the 70s and into the 90s was one of the major management consulting firms in the sewing industry.]
It is both easy and difficult to identify “the most important problem facing the apparel industry today.”
It’s easy because so many well-publicized problems come to mind—imports, labor shortages, rising costs, material shortages, style changes, etc., etc.
It’s difficult because the more serious problems—those that stay with us and carry the greatest long-term threat to our industry—are often overlooked as one short-term crisis follows on another.
As an example, the most prominent problem facing the apparel industry as this was written (May, 1974) would seem to be that of rising costs and prices. Will consumers be willing and able to pay more for apparel this fall? If not, many manufacturers will be in trouble.
Yet the apparel industry has been through periods of uncertainty before and managed to survive. Manufacturers know that they must pay closer attention to costs, quality, service, and—above all—delicately tune their planning to events in the market. Sensitive sales forecasting and line planning, coupled with effective inventory controls, will help most apparel firms to survive this essentially short-term problem.
It will take a sustained effort to resolve the more serious, long-term problems of a shrinking workforce. Although the apparel industry has always been unusually dependent upon a reliable supply of skilled workers and is used to headaches in this area, the problems here are growing steadily worse.
Industry surveys, including some conducted by our own firm, indicate that growth plans of apparel manufacturers have been stymied in the past few years by a shortage of workers. Generally, healthy sales have prompted demand for more production. But in this highly labor-intensive industry, the needed workers haven’t been available to meet such demands.
There are two sides to this people problem. One is the shrinking supply of new workers needed to meet expansion requirements, or simply to keep pace with normal attrition and turnover. Manufacturers find it increasingly difficult to attract new applicants for jobs in apparel plants.
The second aspect of the problem is that, once found, manufacturers find it increasingly difficult to bring new employees up to productive levels of efficiency, or to keep them on the job. Turnover and absenteeism rates in the past few years have reached alarmingly high levels. It is no longer unusual to find plants reporting annual turnover above 100%—even where staple products are being made year-round in the traditional apparel centers of the South.
So, despite the uncertainties surrounding sales for this fall, or the availability of materials, or the costs of both materials and labor, the one problem that promises to be with us next year at this time remains people. There are few indications that the situation will ease.
What can the apparel manufacturer do about this pervasive, long-term problem?
The first step is to recognize that it exists and that no one in the industry is immune to it. Manufacturers will never enjoy much success in solving their people-related problems until they face up to the fact that they have such problems, determine their true nature and size, and take the remedial steps dictated by their own particular stations.
There are quantitative tools available today for measuring employee attitudes, for identifying the leading causes of absenteeism and turnover in a given plant, and for determining the potential of a new labor market.
Better techniques for recruiting, testing, and selecting new employees have been developed and proven. Given today’s tight labor situation, no apparel manufacturer can afford to neglect these.
By converting new hires into productive workers, instead of turnover statistics, the apparel manufacturer has his best opportunity for improving his labor situation. Yet many fail at this stage because standard, proven personnel practices are either neglected or carried out inefficiently.
Proper induction programs, structured and scientific training, effective incentives and other motivational tools, supervisory development, the simple matter of maintaining good communications and attending to the specific causes of employee dissatisfaction—such as providing child care facilities or ensuring equitable earnings opportunities—are all part of it.
Every apparel manufacturer is familiar with these activities and understands their importance. The fact that so few keep up with them in a systematic manner is a mystery—and a major reason why the apparel industry will most likely be faced with the same people-related problems (although probably to a more extreme degree) in the years ahead.