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National Perspective | AMERICAN ALBUM

A stitch in time saves 500 coveted jobs

Government deal helped keep Hathaway shirt plant running. 'Should we really have to rely on China to make all our clothes?' CEO asks.

June 26, 1997|DAVID LAMB | TIMES STAFF WRITER

WATERVILLE, Maine — For 160 years, Waterville's women have taken up needle and thread at the C.F. Hathaway plant to stitch together a product as much a part of Maine's proud tradition as lobsters or timber--the Hathaway shirt.

The company's advertising trademark--a debonair gentleman wearing a white shirt and a black eye patch--became a national symbol for quality in the 1950s. And in Waterville, if you didn't wear a shirt with distinctive three-hole buttons, people knew it wasn't a Hathaway and you weren't a local.

No one, however, was in a kidding mood. The textile industry was dying in New England, the demand for dress shirts had lessened and apparel manufacturers were moving offshore, where clothes could be made much more cheaply. Still, Hathaway was Hathaway and as Mayor Ruth Joseph put it: "I just couldn't imagine Waterville--or the world--without Hathaway shirts."

Waterville and the world did indeed come within a thread of losing the nation's oldest shirt maker. But Hathaway is back from the brink. Saved by an innovative economic rescue package and new owners that include a former Maine governor, the company should be able to keep Waterville's women stitching for a few more generations, at least, town officials say.

"I understand the world's economy and competitiveness," said Don Sappington, Hathaway's new CEO. "But unless we want to be a service country, shouldn't we save some industries that make us self-sufficient? Should Hathaway be the one to be saved? Maybe you can argue that. But should we really have to rely on China to make all our clothes?"

The company appeared doomed on May 6, 1996. That's when Don Swanson, vice president of New York-based Warnaco Group Inc., which bought Hathaway in 1960, called the plant's 500 workers into the cafeteria of the old knitting mill on the Kennebec River. He said Warnaco would no longer sustain Hathaway's losses--$5 million in 1995 alone--and was shutting down the operation. Workers left their ancient foot-pedal sewing machines in midstitch and walked home in a daze.

"Talk about betrayal," said Debbie Perry, one of the stitchers. "We'd cut costs and increased production. We'd made concessions. The company put those big signs up telling us how good we were doing. We thought we were on a roll."

Actually, Warnaco apparently had decided long before to let the brand die, having ended advertising for the shirts and cut its sales force. And the announcement was particularly galling, given that Warnaco was earning record profits.

Rather than simply accept the bad news, however, political leaders as well as the workers themselves launched an unusual effort to keep the plant alive.

Maine Gov. Angus King, the nation's only independent chief executive, drove to Waterville to pledge his support (although he admitted recently he thought the chances of saving Hathaway were about 1 in 10). Louise Loline, a stitcher, put on an eye patch and collected signatures on a Save Hathaway petition at the local mall. The Maine delegation at the Democratic Convention in Chicago last July wore white Hathaway shirts--abandoning the idea of also donning eye patches when someone said the disabled might be offended.

Joseph, the Waterville mayor, convened a statewide task force of 27 people to explore ways to rescue Hathaway. An election was coming up, and no politician was going to quietly let 500 jobs disappear in a town of 17,000. "I knew if we didn't get a deal done quickly," said Joseph, whose mother was a stitcher at Hathaway, "in six months when I called [another meeting], it was going to be 'Ruth who?' and 'Waterville where?' "

*

The man who emerged as Hathaway's savior was an unlikely white knight--former Republican Gov. John R. McKernan, who had never been known as a friend of labor and who had always been at political odds with Joseph, a former Democratic state legislator. McKernan, the husband of Republican Sen. Olympia J. Snowe of Maine, put together a group that saw an opportunity to make money while saving Waterville's jobs.

Under the deal McKernan and Waterville worked out, the city itself purchased the Hathaway plant for $1.6 million--with all but $100,000 coming from federal and state grants. The city, in turn, is leasing it back to McKernan's group, which paid Warnaco an estimated $10 million to $20 million for Hathaway.

The new owners plan to introduce new styles, advertise nationally, go after an upscale market and return the small embroidered "H" that disappeared recently from the shirttail as a cost-cutting measure.

Some skeptics have questioned Maine's priorities, opining that the state should concentrate on job retraining and attracting high-tech industries. But suggest that at the Hathaway plant and workers look at you funny--and know you don't wear a three-hole-button shirt. "We're human too, you know," one said.

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