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COLUMN ONE : It's Blood, Sweatshops and Tears : Legitimate garment makers are being squeezed from both sides. Illegal shops undercut on prices. Manufacturers and retailers want more for less.

August 23, 1995|VICKI TORRES and DONNA K.H. WALTERS | TIMES STAFF WRITERS

Charlie Park, who owns a shop in Los Angeles that sews garments, doesn't have slave laborers. His employees come to work in the morning and go home at night, and they earn $4.25 per hour or more, a legal wage. Park pays them by check and withholds taxes, as required by law.

But when another garment shop opened up in his building and started paying its workers in cash, 20 of Park's 65 employees left to work for the new, unlicensed operator.

It would be easier to be illegal, as he once was, Park said. Then it would not matter how--or how much--he paid his workers because regulators would not even know about him. His would be just one more of California's 2,000 to 5,000 illegal garment shops.

Instead, he must compete with those shops that, by skimping on wages and other working conditions, undercut him on price. Meanwhile, he says, the regulators inspect his shop, not the sweatshops they do not know about.

Lest he antagonize those inspectors, Park does not want his real name used.

But his tale and others illustrate that for the thousands of contractors who are the backbone of Southern California's garment industry, there is every temptation to lie, cheat and steal, in ways large and small.

In this biggest of Southern California's manufacturing industries--employer of 120,000 people--regulators say there are too many small, desperate operators, and too many manufacturers and retailers who want more for less.

Retailers and manufacturers squeeze from above as if they expect contractors to cheat. And down the block, hungry rivals do just that, running illegal shops in unsafe factories, outnumbering inspectors hundreds to one and undercutting their legitimate competitors on price.

"Is it a hard spot?" another contractor, Gary Jue, asks rhetorically. "It's a hot spot and a hard place."

Jue and Park are among the 5,000 legal garment contractors in Southern California. They are the heart of a portion of the economy that has exploded repeatedly across the public consciousness--and conscience--this year.

Their economic woes reverberated not only through the alleged slave labor camp unmasked in a raid this month in El Monte, but also through the bizarre string of recent murders and assaults centered on the Los Angeles maker of Carole Little women's apparel.

California's fashion industry was never an easy or particularly pretty business. It grew up highly competitive and fast moving, craving the cheap labor and agility of small contract shops that could respond to consumers' whims. But when the boom times of the 1980s ended, it became positively brutal.

Consumers got stingy. Retail stores put the squeeze on their suppliers--especially clothing manufacturers--demanding more control over prices and less vulnerability to oversupplies.

As customers sought cheaper clothing, discount chains such as Wal-Mart became powerful forces in apparel. Traditional department stores failed, debt soared and bankruptcies spread, a winnowing process that has hit Southern California retailers as hard as anyone.

The discounters' influence spread throughout the garment industry. As buyer of $100 billion in goods annually, Wal-Mart could demand that suppliers deliver goods early and wait months for payment--pushing down the cost of carrying inventory onto the makers of merchandise, including apparel.

Meanwhile, the growing movement of goods and people from country to country led to stiff competition from apparel shops overseas. In the United States, the explosion of legal and illegal immigration from Latin America and Asia created a vast supply of labor prepared to work for next to nothing.

That mix of events created an opening for those from Thailand who, according to state and federal agents, held 72 of their fellow Thais in servitude for years, forcing them to sew garments up to 22 hours a day for 59 cents an hour, until they were discovered Aug. 2. To say the least, this shop in El Monte was competitive--and its products found their way to the best-known retail counters.

Unsolved Murders

Police and industry insiders believe that the same pressures to cut costs figured in the unsolved Carole Little murders. Beginning in 1993 and continuing through May, three executives with ties to Carole Little have been slain, two others were shot and others have been threatened.

Police and others note that the attacks took place amid a cost-cutting strategy undertaken by Carole Little--similar to that used by other manufacturers--that dramatically pared the ranks of its domestic contractors and drew ominous threats in reply.

That narrowing of suppliers was part of an ongoing economic blood-letting in Los Angeles's garment industry, a process that threatens the survival of thousands of shop owners.

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