Chattanooga Plants Closing, Work Going Overseas

There is more bad news for our local economy as two Chattanooga manufacturing facilities will be closing, adding hundreds of unemployed people to the tens-of-thousands now looking for work. 

This time it's R.L. Stowe Mills which will close it's Chattanooga plants in Highland Park and Lupton City. The company took over Dixie Yarns plants almost ten years ago with the hope of keeping textile manufacturing jobs on home soil.

But as manufacturing jobs keep going overseas and the economy slips deeper into recession R.L. Stowe Mills can no longer make ends meet which means more than 350 people will lose their jobs.

R.L. Stowe Mills president of the specialty yarn division, Jack Callaghan, said "yesterday was a tough day, a tough way to start off a new year."

Callaghan had to make the painful decision Monday to give notice that the plant will shut down March 2. The same goes for the company's plant in Lupton City off Hixson Pike and its headquarters in North Carolina.

The 108-year-old family-owned mill business can no longer compete in the industry so instead of declaring bankruptcy the family decided to pay it's bills and shut down.

"There is a great deal of pride in our company and our organization here and it's a sad day for us to not be able to go forward," Callaghan said.

R.L. Stowe Mills makes the yarn that's used by manufacturers of clothes, socks, upholstery and medical supplies. Those customers are ordering a third less yarn because of the deepening recession and cheaper imports.

"The customer base we have is eroding, primarily due to imported garments that are coming over from Asia, primarily from China," Callaghan explained.

Making things worse, our elected officials have allowed restrictions on Chinese textile imports, designed to protect U.S. businesses, expire last week.

More than 350 people earn a living at R.L. Stowe Mills' plants in Chattanooga - 90 in Lupton City and 257 at the Highland Park plant. In it's heyday just nine years ago that number was double with more than 700 people on the payroll.

By law R.L. Stowe Mills employees will get training to find other jobs but with the economy as it is more than 28,000 people in the Chattanooga region are in the same boat. With more companies looking to Central America and China for yarn and fabric the future of the American textile industry looks grim.

"Unfortunately our manufacturing base, total manufacturing base in the United States, is deteriorating and I think it's the wrong way to go," Callaghan said.

According to the National Council of Textile Organizations about a third of the textile and apparel jobs in the United States have been lost in the last six years.

Callaghan has been on the phone the last couple days trying to find investors who may want to buy R.L. Stowe Mills plants and save the business. But with the economy the way it is and investors nervous about loaning money, especially to the textile industry, the chances of that are very slim.