Restructuring and reconfiguration eu t c industry in transition
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Restructuring and reconfiguration: EU T/C industry in transition. Ian M Taplin Wake Forest University & Bordeaux Business School. Main points. Clothing: past 4 years has seen employment decline of18% Textiles: employment decline of 10% Clothing: firms declined by 15%

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Restructuring and reconfiguration eu t c industry in transition

Restructuring and reconfiguration: EU T/C industry in transition

Ian M Taplin

Wake Forest University

&

Bordeaux Business School


Main points
Main points transition

  • Clothing: past 4 years has seen employment decline of18%

  • Textiles: employment decline of 10%

  • Clothing: firms declined by 15%

  • Textiles: firms declined by 9%

  • Clothing labour productivity = €22000 pa

  • Textiles labour productivity = €33000 pa

  • Textiles retain better labour-related cost competitiveness than clothing


Main points1
Main points transition

  • ¾ of T/C production in 5 countries (Italy, Spain, UK, Germany and France)

  • Italy accounted for 40% of EU clothing production in 2002

  • Netherlands had highest T/C productivity rates (textile dominant)

  • Portugal the lowest (clothing dominant)

  • Spain and Sweden increased employment 1995-2002 (but Sweden from such low absolute numbers)


Capital investment
Capital investment transition

  • Multi-year average annual investment

    • Italy dominant at 47% of EU total for clothing and 27% for textiles

  • Investment rate (share of value added)

    • Ireland, Portugal, Belgium and Greece all invested more than 15% of value added

    • UK bottom with 5%

    • EU average is 9%; Italy is 10%

  • Investment per person

    • Netherlands & Belgium have highest investment per person (€8400 and €7800)

    • Portugal and Spain both very low (€1750 and €1800) as is UK (€1900)

    • EU average = €3300


Noteworthy trends
Noteworthy trends transition

  • Italy

    • Continues to compete on quality/design dimensions

    • Value added stable, productivity rising, employment falling

    • OPT shift to eastern Europe, Romania becoming pre-eminent

    • OPT of higher value added goods; low value added mechanised domestically in early 1990s. Continuing??

    • Large independent retailer presence, many of who now doing their own sourcing overseas (overcame early problems of small size)

    • Branded manufacturers developing retail outlets (Max Mara, Diesel, Zegna). Networks important.

    • Retail concentration low = lower rates of import penetration


Trends continued
Trends continued transition

  • UK

    • Rapid decline in both sectors since mid 1990s

    • Increase in import penetration = lower prices = increased consumption

    • Minimum wage introduction not seen as problem

    • Firms unwilling to invest in worker training and skill acquisition

    • Male/female ratios now 50:50

    • New categories of workers emerging as firms specialise in distribution coordination and design/marketing functions


Trends continued1
Trends continued transition

  • Germany

    • Continued capital intensification and technological upgrading in textiles (high value added and innovative products)

    • Clothing focused upon organisational optimisation and outsourcing

    • As firms outsourced, demand for high quality production resulted in industrial upgrading for overseas manufacturers and further competition for domestic manufacturers

    • Strong links between textile firms and buyer groups (autos, packaging etc.)

    • New job categories emerging: distribution and coordination plus craft-like specialist studios