Washington DC, United States: American political news is going at a breakneck speed, and it’s hard to focus on one thing — from the continued abuse of immigrant children who are taken from their homes under cover of night, or the fallout from the Kavanaugh hearing, they’re all important and they all have rippling consequences. President Trump’s trade war with China is hurting specific industries like steel, but it’s also changing the global supply chain of goods made in China and might end up making fashion and other goods made overseas less ethical.
This trade war is essentially a fight over tariffs and how much it costs to import goods from each country to the other. Tariffs are a type of import tax that charges the importing business money, which causes many to choose to raise prices to make up for the difference. Companies don’t necessarily have to raise prices, some like J. Crew have found other ways to lower their costs and won’t raise the price of their goods. The most ethical option is to reduce the salaries of senior staff and CEOs, but most will either pass on prices to consumers or find ways to reduce their costs through their supply chain; the latter could potentially see clothing manufacturing move from China to places with even fewer regulations, like Ethiopia or Myanmar.
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The issue started when the Trump administration imposed a steep 25 percent border tax on $34 million worth of Chinese goods to encourage businesses and consumers to buy from alternative sources. This goes after the bottom line of Chinese companies to punish and pressure the Chinese government. After the Chinese government retaliated with tariffs of their own, the Trump administration expanded its initial tariffs to include approximately $200 billion worth of goods, including consumer products like clothing. The theory behind raising tariffs on foreign goods is to make them more expensive and thereby encourage companies to move production into the U.S. and price goods competitively to encourage American consumers to purchase locally made. This is unlikely to happen in the apparel industry; the U.S. simply does not have the labor market to sustain global clothing production.
China is essential to the apparel industry’s supply chain. According to Marketplace almost every textile company has some business in China. What’s likely to happen immediately is increased prices on fashion items, after which companies will look for ways to move production out of China into countries that aren’t as heavily taxed, many of which have extremely lax labor regulations. It will increase outsourcing, or transferring production outside their typical factories, creating an opportunity for slave traders to inject themselves into the supply chain with “hidden” or forced labor.
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This will also hasten the shift to automation in the apparel industry, which will completely change how clothing is made, where it’s made, and the fate of the countries and people employed by the fashion industry. While the U.S. is not viable for human labor, it is one of the few countries that would be acceptable to house automated production. The U.S. and other industrialized countries have access to electricity and engineers to maintain factories full of sew bots, which now have the capability to make tee-shirts with 100% automation. This is already happening, and according to the South China Morning Post, Esquel, a Hong Kong-based clothing manufacturer, is shifting into sewing robots to cut prices and transition away from production in factories in Vietnam, Sri Lanka, and Malaysia. Esquel is investing in U.S. robotics company Grabit, which created a way for robots to “pick up” and maneuver fabrics, something that has traditionally been saved for human hands. While the move to automation would save textile workers from awful working conditions, it will drastically change the opportunities for unskilled work, not only in the developing world, but across the globe. Historically, humans have relied on manufacturing as a source of steady, low-skill work, but as technology makes certain jobs obsolete over the next few decades, what happens to those whose jobs have been taken, not by immigrants, as is the Trump administrations common rhetoric, or any other scapegoat, but by machines that can work longer hours and for less money than any person? There’s no right answer, but it’s a question that we should meditate now before it’s an acute problem.
So, while the trade war is meant to punish the Chinese government for what the Trump administration sees as unfair trade practices, it will be felt by garment workers and laborers the world over.
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