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The lure of protectionism

KANNAPOLIS was once a company town. James Cannon, a textile tycoon, founded it in 1906 so that he could keep a paternalistic eye on his workers. During the Depression, his son—the beloved “Old Mr Cannon”—looked after his people and built them tiny white houses. Good wages, free electricity and the promise of a secure job tied each generation to Cannon Mills.

But the textile giant, which used to produce 300,000 towels a day, could not fight off cheap imports or indeed the march of technology. On July 30th 2003, Pillowtex, the last in a string of owners, closed all 16 of its American factories, throwing nearly 6,500 people out of work. It remains the largest single-day job loss in North Carolina's history; in the Kannapolis area alone, 4,300 people lost their jobs.

Today, the old mills are gutted and ready for demolition. And most of the workers are still puzzling over what to do. Over the past decade, North Carolina has lost 250,000 manufacturing jobs (90,000 in textiles). With textile quotas now having been phased out, still more jobs will go.

North Carolina's technology and service sectors are booming. But many mill workers are woefully ill-prepared for such work. When Pillowtex finally closed the doors, one in three of its workers lacked a high-school education; one in ten could not read or write; and nearly half of them were more than 50 years old.

China-bashing and trade Apr 21st 2005 United States America's economy Fashion and textiles The US Department of Labour has information on the Trade Adjustment Assistance Reform Act of 2002. See also North Carolina's Employment Security Commission.

An established federal programme, Trade Adjustment Assistance, provides fairly generous income support for such workers while they are being retrained. In 2002, Congress stretched these benefits from 78 to 104 weeks. But the Pillowtex closing is so vast that it is testing the programme's effectiveness. “Never have we had so many who had worked for so long at one place lose their jobs,” says Linda Burton, a 30-year veteran of the Employment Security Commission, the state agency that helps workers find jobs.

Nearly 2,000 of the workers signed up to retrain. Many of them had not set foot in a classroom for several decades. “I didn't know how to use a calculator,” admits Jerry Kennerly, a 58-year-old who is studying to pass the high-school equivalency test. “I had to relearn algebra.” They keep their morale up with tales of heroic feats: the woman who jumped from a seven-year-old to a 12-year-old reading level in one year; the 70-year-old man who passed his high-school equivalency exam. But it is tough. “If I don't learn computers,” says Mr Kennerly, “I'm going to be behind.”

The true test will come in December when the first big group of worker-graduates starts hunting for jobs. Many of the older ones want to stay in Kannapolis, which is hardly booming nowadays. And there are plenty more who are not even close to getting the training. Some are languishing in remedial courses, unable to get to the 12-year-old reading level that they need to enter a job-training course. The mill employed quite a number of mentally or physically disabled people to sweep the floors. They are struggling the most, says Ms Burton. “We are hoping companies will have a heart.”

The group of workers that may actually gain most from the training are foreigners. So long as they could prove they were legally in the country, several hundred Laotian and Latino workers qualified for training. Scores of poor immigrants who never dreamed of being much more than manual labourers are now getting a free education. Crucially, unlike the locals, they feel fewer ties to Kannapolis and so will take their new skills anywhere.

Ying Xiong, a 38-year-old Laotian woman who worked as a weaver, is now learning English and computers. She hopes to become a medical-unit secretary. She reckons this is a safe bet, as Americans will never ship their health care overseas. Old Mr Cannon's workers once probably felt the same way.