As per a new report by the global intelligence firm Creditsafe, the US manufacturing industry including the apparel and textile sector may face severe negative impacts of COVID-19. The industry may lose $400 billion in revenue in 2020 due to the pandemic, the report says. It warns manufacturers, also including industrial machinery equipment, printing and publishing, and fabricated metal products, of significant decreases in their revenue and facing difficult decisions on navigating through these difficult times.
The US manufacturing industries represent over half a million businesses across the country, with more than 17 per cent expected to experience a severe downturn and financial crisis from the economic impact of the coronavirus. According to the National Council of Textile Organizations, the US textile industry supply chain, from textile fibers to apparel and other sewn products, employed 585,240 workers last year. Of the 31,735 manufacturers of clothing and other textile products reviewed by the report, 5.8 percent of them are likely to face severe risk.
They may face factors such as mandatory closures, changes in buyer behavior and disruptions to the supply chain are all contributing to the overall risk that the manufacturing industry is facing. These could then cause ripples through a loss of employment, decreases in revenue and delays in production, Creditsafe noted.
The pandemic has caused the US, and specifically manufacturers, to look to a more localized supply chain and bring several types of critical manufacturing sectors back on shore. The Creditsafe report cites the April Thomas Industrial Survey that shows 64 per cent of manufacturers planning to bring production and sourcing back to North America, with 25 per cent increasing their use of automation.