The US$1.9 trillion economic relief bill signed into law yesterday (11 March) by President Joe Biden has been described as “enormously beneficial” for the US apparel and footwear industry.
The ‘American Rescue Plan Act of 2021,’ (H.R. 1319)provides additional relief to address the continued impact of the Covid-19 pandemic on the economy, public health, State and local governments, individuals, and businesses.
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This includes payments of $1,400 for most Americans, an extension of jobless benefit payments of $300 until September, and a child tax credit. It also allocates $350bn to state and local governments, $49bn for Covid-19 testing and research, and $14bn for vaccine distribution.
But proposals to raise the national minimum wage from $7.25 to $15 per hour did not make it into the final version of the bill.
“This relief comes just days after the decision to temporarily extend tariff exclusions for imports of crucial Personal Protective Equipment (PPE) and to temporarily lift other punitive tariffs which have been undue taxes on American businesses and consumers,” says Steve Lamar, president and CEO of the American Apparel & Footwear Association (AAFA).
“Each of these actions are enormously beneficial steps for American businesses, American workers, American families, and the American economy, in getting to the other side of this pandemic.”
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By GlobalDataHe notes the extended employee retention tax credit (ERTC) will allow businesses to keep American workers employed, while the relief that is targeted for individuals – such as the stimulus cheques – underscore how important a healthy consumer is for sustained economic growth.
“This industry suffered a double-jab of the Covid-19 pandemic and the increasingly burdensome tariffs we face to get affordable products to consumers,” Lamar adds.
“At the same time, this industry has been on the front lines of repurposing supply chains to quickly fill our country’s critical need for personal protective equipment, adjusting operations in line with health guidance, and creating safe spaces for Americans to shop for essential apparel and footwear needs across many seasons of this pandemic.”
The association continues to educate the industry and consumers about safe shopping practices, wearing face masks, and accessing the Covid-19 vaccine as soon as possible to protect all Americans and allow the economy to flourish again.
“Stimulus is an important part of the equation, but this investment will be squandered without widespread vaccinations or if we end mask-wearing and social distancing measures too early. Beyond stimulus, it is important we quickly pass legislation to build a backstop for trade credit insurance and create limited liability protections, both of which are needed to sustain our recovery,” Lamar concludes.
This is the third stimulus package signed by the US. The $2 trillion CARES Act was approved by Congress in March last year, and President Donald Trump signed a $900bn pandemic relief bill into law in December. The measures have helped sustain retail sales spending.
