North Carolina Labor department studies plight of Pillowtex workers

Manufacturing & Technology News, Dec 21, 2007

About 40 percent of the laid off workers from bankrupt Pillowtex Co. had not yet found work three years after they lost their jobs, and for those who have, take-home pay isn't as much as they were making at Pillowtex. The North Carolina Employment Security Commission's Labor Market Information Division is following the employment prospects of 4,820 laid off workers from Pillowtex, the largest mass layoff in North Carolina history.

By the end of 2006, the average annual wage of an ex-Pillowtex worker in a new job was $24,488, not including benefits, compared to $27,040 while at Pillowtex prior to its closure in 2003.

Twenty-three percent of the workers finding jobs went into the trade, transportation and utility industry; 22 percent went into education and health services; and 15 percent went into professional and business services.

"During our analysis of Pillowtex workers, we have been noticing a trend within our professional and business services industries," says Betty McGrath of the North Carolina Employment Security Commission. "What on the surface appeared to be a positive outcome for these workers, upon further analysis revealed ... a large number of workers who are finding employment within [this category] are on the payrolls of temporary health firms. A substantial amount of growth that is occurring in professional business services is actually due to the growth of temporary health services."

North Carolina has been the most impacted state in the nation by layoffs due to trade. Between 2004 and 2006, almost 39,000 North Carolina workers have been certified by the Trade Adjustment Assistance program as having lost jobs to trade, more than 10 percent of the U.S. total of 387,755. North Carolina's job losses due to trade between 2004 and 2006 far surpassed the next closest state, California, which lost of 30,717 jobs, followed by Pennsylvania with 21,373, Michigan with 20,574, Ohio with 18,306 and South Carolina with 17,697.

"North Carolina's economy is undergoing a major transformation," McGrath told a recent field hearing of the United States-China Economic and Security Review Commission. "Our economy continues to shed jobs in our manufacturing industries, but at the same time is experiencing tremendous growth within our service providing industries."

The state has found that many laid off manufacturing workers have a difficult time leaving their communities to look for work. "The manufacturing plant was more than just the place of work," said McGrath. "It was the core and center of that community--many generations." Hundreds of small towns throughout North Carolina impacted by plant closures are dying. "There is a sense of community inherent in the people of North Carolina," said McGrath. "It's easy to say go take advantage of training and go get a new job. It's a complete overhaul of their perspective on what their relationship to work is."

Young people are moving out of the impacted towns, but older family members stay, a point that brought the following observation from U.S-China Commission chairman Carolyn Bartholomey: "When we were in Ohio a couple of years ago, we were told that Ohio's biggest export was its young people because there was no future for them there."