The full study is available HERE.
Textiles and apparel “Made in the USA” have gained growing attention in recent years amid the increasing supply chain disruptions during the pandemic, the rising geopolitical tensions worldwide, and consumers’ increasing interest in sustainable apparel and faster speed to market. Statistics from the U.S. Bureau of Economic Analysis showed that U.S. textile and apparel production totaled nearly $28 billion in 2022, a record high in the most recent five years. Meanwhile, unlike in the old days, a growing proportion of textiles and apparel “Made in the USA” are sold overseas today. For example, according to the Office of Textiles and Apparel (OTEXA) under the U.S. Department of Commerce, U.S. textiles and apparel exports exceeded $24.8 billion in 2022, up nearly 12% from ten years ago.
By leveraging U.S. Department of Commerce Office of Textiles and Apparel (OTEXA)’s “Made in U.S.A. Sourcing & Products Directory,” this study explored U.S. textiles and apparel manufacturers’ detailed production and export practices. Altogether, 432 manufacturers included in the directory as of October 1, 2023, were analyzed. These manufacturers explicitly mentioned making one of the following products: fiber, yarn, fabric, garment, home textiles, and technical textiles.
Key findings:
First, U.S. textile manufacturers exhibit a notable geographic concentration, whereas apparel manufacturers are dispersed throughout the country. Meanwhile, by the number of textile and apparel manufacturers, California and North Carolina are the only two states that rank in the top five across all product categories, showcasing the most comprehensive textile and apparel supply chain there.
Second, U.S. textile and apparel manufacturers have a high concentration of small and medium-sized enterprises (SMEs). Highly consistent with the macro statistics, few textile and apparel manufacturers in the OTEXA database reported having more than 500 employees. Particularly, over 74% of apparel and nearly 60% of home textile manufacturers are “micro-factories” with less than 50 employees.
Third, U.S. textile and apparel manufacturers have limited vertical manufacturing capability. A vertically integrated manufacturer generally makes products covering various production stages, from raw materials to finished products. Results show that only one-third of U.S. textile and apparel manufacturers in OTEXA’s database reported making more than one product type (e.g., yarn or fabric). Meanwhile, specific types of vertically integrated production models are relatively popular among U.S. textile and apparel manufacturers, such as:
- Apparel + home textiles (5.8%)
- Fabric + technical textiles (5.1%)
- Yarn + fabric (3.9%)
However, the lack of fabric mills (N=38 out of 432) appears to be a critical bottleneck preventing the building of a more vertically integrated U.S. textile and apparel supply chain.
Fourth, it is not uncommon for U.S. textile and apparel manufacturers to use imported components. Specifically, among the manufacturers in the OTEXA database, nearly 20% of apparel and fabric mills explicitly say they utilized imported components. In comparison, given the product nature, fiber and yarn manufacturers had a lower percentage using imported components (11%). Furthermore, smaller U.S. textile and apparel manufacturers appear to be more likely to use imported components. For example, whereas 20% of manufacturers with less than 50 employees used imported input, only 10.2% of those with 50-499 employees and 7.7% with 500 or more employees did so. The results indicate the necessity of supporting SME U.S. textile and apparel manufacturers to access textile input through mechanisms such as the Miscellaneous Tariff Bill (MTB).
Fifth, many US textile and apparel manufacturers have already explored overseas markets. Specifically, factories making textile products reported a higher percentage of engagement in exports, including fiber and yarn manufacturers (68.4%), fabric mills (78.9%), and technical textiles producers (69.1%). In comparison, relatively fewer U.S. apparel and home textile producers reported selling overseas.
Sixth, U.S. textile and apparel manufacturers’ export markets are relatively concentrated. Specifically, as many as 72% of apparel mills and 57% of home textiles manufacturers in the OTEXA database reported selling their products in less than two markets. These manufacturers also have a high percentage of selling to the U.S. domestic market. Likewise, because of the reliance on the Western Hemisphere supply chain, more than half of U.S. fiber and yarn manufacturers reported only selling in two markets or less. In comparison, reflecting the global demand for their products, U.S. technical textile manufacturers had the most diverse markets, with nearly 40% exporting to more than ten countries.
Seventh, while the Western Hemisphere remains the top export market, many U.S. textile and apparel manufacturers also export to Asia, Europe, and the rest of the world. For example, nearly half of U.S. textile and apparel manufacturers in OTEXA’s database reported exporting to Asia, and over 60% of U.S. technical textile manufacturers sold their products to European customers.
Additionally, over half of U.S. textile and apparel mills engaged in exports leveraged U.S. free trade agreements (FTAs). U.S. textile mills, on average, reported a higher percentage of using FTAs than apparel and home textile manufacturers. As most U.S.-led FTAs adopt the yarn-forward rules of origin, the results suggest that while such a rule may favor the export of U.S. textile products, its effectiveness and relevance in supporting U.S. apparel exports could be revisited.
Moreover, in line with the macro trade statistics, U.S. textile and apparel manufacturers in the OTEXA database reported a relatively high usage of USMCA, given Mexico and Canada being the two most important export markets. In comparison, U.S. textile and apparel manufacturers’ use of CAFTA-DR was notably lower, even for fiber and yarn manufacturers (37%) and fabric mills (33.3%).
by Kendall Ludwig, Miranda Rack and Sheng Lu
Picture above: On December 13, 2023, Kendall Ludwig and Miranda Rack, FASH 4+1 graduate students and Dr. Sheng Lu, had the unique opportunity to present the study’s findings to senior U.S. trade officials from OTEXA and the Office of the U.S. Trade Representative (USTR) in Washington DC, including Jennifer Knight (Deputy Assistant Secretary for Textiles, Consumer Goods and Materials), Laurie-Ann Agama (Acting Assistant US Trade Representative for Textiles), Maria D’Andrea-Yothers (Director of OTEXA), Natalie Hanson (Deputy Assistant US Trade Representative for Textiles) and Richard Stetson (Deputy Director of OTEXA).
Check the Udaily article that features the research project and the presentation (February 2024).
FASH455 Global Apparel & Textile Trade and Sourcing 
It does not come as a surprise to me that apparel “Made in the USA” is growing in popularity and attention, mainly because nearshoring has become a trend for US manufacturers, and brands and retailers have begun to look in directions other than China for sourcing. Apparel that has been manufactured in the US comes from California or North Carolina, more often than not, and it shocks me that states such as New York or Texas are not as far up on the list of product manufacturers. I think it makes sense that, although nearshoring and apparel “Made in the USA” is growing in demand, US textile and apparel manufacturers cannot easily become vertically integrated. Some materials and resources are not easily accessible for US brands and retailers to come across, which inhibits their ability to become vertically integrated. In my opinion, it is good that US textile and apparel manufacturers are exporting to places outside of the US in order to grow their markets and expand their customer base.
This article was interesting to read and said a lot of unexpected information, like one of my classmates mentioned above. As “made in USA” is becoming more popular, it is mainly for textiles. This is because we are a tech and capital intensive production country. It Is also no surprise the Western Hemisphere is a top export for the US. This would make sense with FTAs with CAFTA-DR and also because the US is not able to be vertically integrated. With the Western Hemisphere trade agreements we get closer to a vertically integrated system and hopefully increasing the exports of the Western Hemisphere. It is interesting the post ends with “U.S. textile and apparel manufacturers’ use of CAFTA-DR was notably lower, even for fiber and yarn manufacturers (37%) and fabric mills (33.3%).“I am looking forward to seeing how the western hemisphere continues to grow in the future and see if the US chooses to invest more money in production partners such as Costa Rica, Mexico, and Nicaragua. I also wonder what we can expect in legislation in the near future to push Made in USA and a more vertically integrated and diverse Western Hemisphere market.
It is clear from this article that the textile industry in America is the main focus of production. Garments are not our main export which makes sense based on the theories discussed early in this class. The US is abundant in capital so we focus on textile production. It does beg the question of if we should care about our garment production in the US. It appears that “made in the US” is a selling point for some consumers, but only really in the US because we are not clothing exporters. Should we put more attention and influence on textile manufacturing since it is more aligned with the US’s strengths or should we attempt to help the garment manufacturing industry to increase vertical integration? Is there a way that policy can do both? These are interesting questions that I would want answered based on what I read in this article.