North American Textile Sector Sees Slow Growth in Third-Quarter 2013

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Researched by Industrial Info Resources (Sugar Land, Texas)--The North American textile sector is showing slow but steady growth in the third quarter of 2013. Industrial Info is tracking $95 million in capital and maintenance expenditures in the textile industry for the quarter.

The bulk of spending is coming from a Middle Eastern company from Dubai and Saudi Arabia, which has proposed a $60 million carpet-backing manufacturing plant in the U.S. It would be the company's first manufacturing facility outside of the Middle East. The remainder of the spending for the textile sector involves planning two new small fabric plants, maintenance activities, and the occasional upgrade of an existing plant.

The textile industry once was a vital part of the U.S. economy. But beginning in 1997, more than 1,000 textile mills were closed, significantly cutting employment. Thanks to companies outsourcing jobs to low-cost labor in foreign countries, the number of textile plant employees in the U.S. is estimated to be about 240,000. That number is down from the more than 600,000 Americans in 2005, when the textile sector contributed an estimated $23 billion to the nation's gross domestic product (GDP).

Competition with other nations, such as China, has caused the U.S. textile sector to suffer a drastic toll. Cheap imports from Mexico, as well as other countries, are giving U.S. textile companies the cost incentive to move existing production south. Falling demand and a decrease in exports also have weakened the sector.

Rising production costs, flat prices and the pressure to improve existing conditions has caused the textile manufacturers to make a drastic choice: either set up factories in other countries to benefit from lower production costs, or close indefinitely. Overall, the industry has decreased dramatically.

Although spending seems to have picked up only slightly, the sector as a whole seems to be a dying breed and could come to a halt within the next couple of years, if economic issues do not improve.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.