US companies want Reagan to halt the march of imported shoes. President's decision on quotas is due in September
Boston — American shoe manufacturers, pressing the Reagan administration to place import quotas on their foreign competitors, have reached first base. The United States International Trade Commission (ITC) concluded last week that the domestic shoe industry is seriously threatened by imports. By Sept. 1, when baseball fans are discussing possible World Series matchups, the shoe industry -- much of which is centered in New England -- should know whether it has scored. That's when President Reagan will announce his decision on whether and how to provide some protection against imports.
The best news for most shoe manufacturers would be if Mr. Reagan decides to impose import quotas on nonrubber footwear. But that would not be good news for American consumers, says a spokesman for footwear retailers.
``If the restrictions being sought are put into place, it will cost the American public $3 billion a year,'' says Peter Mangione, president of the Footwear Retailers of America, an industry group based in Washington, D.C. ``And this would fall hardest on low-income people, since these folks are the largest group of customers for low-priced shoes.''
But George Langstaff, president of Footwear Industries of America, insists that ``the domestic footware industry desperately needs five years of [import] quotas if it is to survive.''
He cites the record number of domestic shoe factories -- 92 -- that closed in 1984, and the loss of 6,600 shoe worker jobs -- 18.6 percent of the total -- in the same 12 months.
Several other figures indicate why US shoe companies are so concerned, and why the ITC this year reversed its finding in 1984 that relief for the industry was not warranted: In 1980, imports accounted for 49 percent of the US shoe market; in 1984, that share was 71 percent. And in the first three months of 1985, according to shoe industry sources, imports accounted for more than 75 percent of domestic sales.
The five-member ITC will meet around June 12 to decide what steps to recommend to the President to aid the shoe industry.
It could urge him to impose import quotas on shoes from overseas sources -- chiefly Taiwan, South Korea, Spain, Italy, and Brazil. It could suggest that the present 8.8 percent tariff on imports be raised; recommend so-called trade-adjustment assistance; or urge a combination of such steps.
After the President gets the ITC's recommendation, expected around July 1, he will have 60 days to make his decision.
The industry prefers import quotas, since they would guarantee US shoemakers a specific share of the market. The industry itself has proposed to the ITC that nonrubber imports be limited to 55.2 percent over a five-year period. (Imports of rubber footwear, mostly protective gear such as overshoes, are not at issue. The import-restriction debate is about footwear made from leather and from vinyl or other synthetics.)
A bill introduced in the US House of Representatives by Rep. Olympia J. Snowe (R) of Maine would limit imports of nonrubber footwear to 50 percent for eight years. A similar bill was introduced in the Senate.
The proposal has the bipartisan support of members of Congress from all the major shoe-producing states -- Maine, Massachusetts, Missouri, Pennsylvania, and Tennessee.
But Mr. Mangione of the retailers group says that if import quotas are imposed, ``Americans will have as their only choice a lot of high-priced American-made shoes in types and styles they may not want and at prices they maybe can't afford. . . . Virtually all low-priced shoes -- those that retail for under $50 -- are made overseas. Because of labor and other costs, you can't make those kinds of shoes in the US.''
Mr. Langstaff says that a five-year program of import quotas ``will give us the breathing room we need to institute our comprehensive, five-year technological and marketing improvement plan, which will make our industry competitive with imports.''
Langstaff says the industry plan is ``designed to ensure an adequate supply of low-cost footwear.''
Ken Crerar, a spokesman for Footwear Industries of America, says this would be accomplished by setting quotas in three price categories, with the lowest-priced shoes from overseas having the same market share as in 1984 (71 percent).
Mr. Crerar says cost studies have shown that US shoe factories, if protected by quotas over the next five years, can become competitive by using technology that already exists.