California Apparel News

The state of California wants the apparel industry to win the war against imports and is willing to pay for it. State officials lately have been getting more aggressive in working with the apparel industry to offer free job training and other incentives to keep local apparel manufacturers and distributors competitive. The only problem is that not many companies know about them or take advantage of them.

“It’s a shame. We have a new program offering training for companies, and we’re having to call them and explain to them that they can get it for free,” said Frances Harder, executive director of Fashion Business Inc., the Los Angeles–based apparel industry incubator. “We have to call them three or four times before it registers with them.”

Charles Lundberg, director of economic development for the state’s Employment Training Panel (ETP)—which is the source for funding for the FBI program—said marketing has always been a challenge. “A lot of people are incredulous,” he said.

The FBI program offers computer training to companies, as well as to non–apparel industry employees and displaced workers. Its first course offered training on the AIMS computer program, which is an order-management system that many apparel companies use to manage costing, EDI, sales and other processes. Another course offered computer-aided design pattern-making using the PAD system. A new AIMS class is now underway, and soon Gerber Technology will offer a course.

A recently concluded course in CAD/CAM design would normally cost about $900, so the savings could be substantial, said Kristine Gloviak, a vice president with PAD System Technologies.

Santa Monica City College, through the ETP, offers a similar free program for computer graphics programs such as Illustrator and PhotoShop at the Cooper Design Space in downtown Los Angeles.

There is a strong need for such skills because the local industry is moving away from cut-and-sew toward design and distribution.

Shift in apparel business

California apparel manufacturing is still strong, however, moving ahead of New York as the largest apparel manufacturer in the country, according to Jack Kyser, chief economist for the Los Angeles County Economic Development Corp.

Manufacturers are becoming distributors and importers, and the region has become a capital for design, Kyser said. As a result, there’s a stronger need for technology.

“Finding a workforce is always the challenge for manufacturers. In our courses, we teach them the AIMS system, but it’s used only as a tool,” said Henry Cherner, principal of AIMS and a course instructor. “We apply the principles of apparel manufacturing, and as manufacturers become distributors, there’s still a need for data entry.”

Harder said the programs were also helping to reallocate resources resulting from the shift in business. Several students in the current course have been displaced as a result of the Federated/Robinsons-May merger, for example.

“Manufacturers are mobile,” Lundberg said. “They will go where the workforce is. We have to keep them here. There are good opportunities for apparel companies right now to take advantage. There are fewer budget constraints on us now.”

He explained that the ETP fund has $13 million more in its budget this year. The program is funded by employer taxes, which contribute $7 per full-time worker.

“Companies usually come to us telling us what they want,” Lundberg said. “They need training for certain processes, new machinery, customer service or teaching English as a second language, which is of interest to the apparel industry.”

Working with ETP are agencies such as Community Career Development Inc., which provides free employment recruitment and other services. The nonprofit group worked with Fashion Business Inc. to provide recruitment, screening and other services. It’s helping other operations, such as the Metropolitan Transit Authority, fill about 300 to 500 new positions.

“We were set up to help with economic displacement, plant closures; now the focus is meet the challenge and be the go-to agency for employers,” said agency director Gloria Moore.

Enterprise zones under review

Although such programs are thriving, others are in jeopardy. The state’s enterprise zone program, for example, has come under scrutiny due to alleged abuses in some districts. The city of Los Angeles’ Central City Enterprise Zone—which includes the Fashion District—is up for renewal, but there’s no guarantee that it will be renewed, said Cliff Weiss, a specialist with the city’s economic development department. “It’s a statewide competitive process,” he said, “and we don’t know who we’re up against. There are only 23 zones.”

City officials won’t find out until October whether the zone will be maintained.

Companies in enterprise zones may be entitled to tax deductions and hiring tax credits for up to $31,500 per employee over a five-year period. “It’s an excellent business-retention tool,” said Weiss.

Although many local and smaller companies are in the dark about incentives and subsidies, savvy retailers such as Wal-Mart Stores Inc. have been taking advantage for years. Wal-Mart saves as much as $1 billion a year by taking advantage of taxpayer-financed subsidies such as enterprise and empowerment zones, government grants, tax rebates, and infrastructure financing, according to the Washington, D.C.–based research group Good Jobs First.

Pacific Sunwear of Anaheim, Calif., also has taken advantage. The retailer is building a $39 million distribution center in Olathe, Kan. It is receiving 10 years in property tax rebates as a result.

California officials fret about such out-of-state moves, and by stepping up assistance, they hope to keep more jobs in-state.

For more information, visit www.etp.ca.gov or www.fashionbizinc.org.