New York looks for ways to mend its fraying garment industry. Fashion capital of US struggles against import tide, rising costs

The garment district in Manhattan is a traffic hazard to motorists, as men pull racks of clothing down the avenues. To buyers from around the United States, it's the frantic mecca where they select the next season's fashions six months ahead of time.

To many New Yorkers, it is a livelihood. Ranging from employers to factory workers, designers to sewing-machine suppliers, fabric salespeople to ragmen, up to 150,000 people work in the city's garment industry, mainly in the midtown garment center or in factories in Chinatown. The garment industry is the largest manufacturing employer in the city.

But like other industries here, the garment business has suffered heavy losses in the past 30 years. Inexpensive imports, high Manhattan rents, relocation to the South with its cheaper wages, and an up-and-down market have taken a toll.

Now different groups linked with the garment industry are looking for ways to shore it up. Varying solutions include support for protectionist legislation in Congress, zoning proposals to maintain space in New York City, and city aid to relocate manufacturing in outer boroughs of New York. Support for these solutions is not unanimous. And there is a debate over where the future lies.

But no one here wants to see New York lose its hold as the fashion capital of the country or, to some observers, the world.

Susan Cowell of the International Ladies' Garment Workers' Union (ILGWU) envisions a healthy garment district, still centered in Manhattan, that includes salesrooms and showrooms, design and marketing offices, samplemaking, and specialized production.

``If there were only showrooms here, we might as well be Dallas or Atlanta,'' says Ms. Cowell, referring to regional fashion marketplaces. The ILGWU supports the proposed Textile and Apparel Trade Enforcement Act now before Congress, which would tighten quotas on imports. And the union advocates a combination of zoning and/or industrial rent control in New York City to save companies from exorbitant real estate costs.

The garment industry is ``extremely important'' to New York, says Si Lippa, director of the Office of Apparel and Accessories in the city's Office of Business Development. Women's and children's clothing worth around $13 billion wholesale is shipped out of New York yearly, he points out. And the business offers entry-level jobs for nonskilled, immigrant workers, mostly women.

But the city wants commercial rents to remain in the free market, and it is hesitant about zoning or rent control.

One possible answer, Mr. Lippa says, is to help firms that cannot afford midtown rates to relocate to the outer boroughs or to above 96th Street in Manhattan. The city offers grants to help cover moving costs, and subsidized loans for leasehold improvements. In the less than a year since the program began, some 53 firms have either moved or are about to, Lippa reports. The city also offers various other financial enticements.

The city is also doing an exhaustive survey of the garment district, and this fall it will come out with recommendations on actions to bolster the industry. It may include zoning; changes in policies that seek to keep the industry in the city; and ways to deal with the high cost of electricity, says a city planning department spokesman.

A subway map on Lippa's wall has large dots on sites where he would like to see clusters of industrial development. With showrooms, offices, and sample rooms in Manhattan for the fashion market, outer-borough factories would maintain the same work force and help areas that have lost jobs.

Ms. Cowell of the ILGWU argues that outer-borough development doesn't generally do that well, and that firms would rather keep their operations in Manhattan, near the garment district.

``If a manufacturer is going to be an hour away from midtown, he might as well be in New Jersey or Connecticut,'' where utility costs are often cheaper, she says.

Corey Greenspan of the Federation of Apparel Manufacturers is also concerned about rental pressures and hidden costs passed on to tenants. ``Submetering,'' the practice by landlords of buying electricity at a volume discount and then selling it to users at a higher cost, is often mentioned as a problem in the garment industry.

Mr. Greenspan says the city should consider some type of protective zoning to reduce rent pressures. If companies decide to move out of the city, it means a ripple effect in job losses -- the company's employees, contracters, and suppliers.

``It would be to the city's great advantage to protect the entire chain,'' Greenspan says.

Shep Porter of Regina Porter, a line of women's blouses, says manufacturing is out in Manhattan. ``Prices are prohibitive,'' he says. And Mr. Porter, a self-professed believer in laissez-faire policies, does not think zoning is a good answer.

``You can speak of altruism, but the reality is the marketplace,'' he says.

Who will survive in the garment district?

``The people who will do best and those that will stay are the firms with products that don't compete with low-priced imports,'' Lippa says. These include moderate- to high-priced apparel that is ``right on fashion,'' and companies that can ``turn on a dime'' in production. ``There is no substitute for quick delivery,'' he says.

Justin Israel of Knitwaves, a line of children's clothes, does most of his manufacturing in Brooklyn, which he likes to call the ``Near East.'' He eschews imports and uses domestic workers and domestic yarns. One of the reasons his company survives, he says, is that it is very fashion oriented. But he does see imports as a threat, and as not much of a bargain for consumers, noting the markup that occurs in stores. He says import restrictions are ``very necessary.''

Porter disagrees. His company's blouses are all imported, but he points out that his firm still has 42 employees in his garment-district offices.

``We don't have the hands, the machinery, the equipment to supply our enormous demand,'' he says. Quotas merely increase prices for consumers, he asserts.