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July 18, 2022

Biden rail intervention deemed critical for US apparel sector

The American Apparel & Footwear Association (AAFA) has welcomed US President Joe Biden's new Executive Order to prevent rail disruption amid the critical back-to-school season and ahead of preparations for the holidays.

By Laura Husband

The AAFA’s senior vice president of policy, Nate Herman, tells Just Style exclusively, that tackling the supply chain bottlenecks caused by rail disruption will help the US apparel sector deliver essentials such as clothes, shoes, and backpacks to American families in the coming months.

Herman says Biden’s intervention to help resolve the ongoing dispute between major freight rail carriers and their unions, which is effective from today (18 July), is a vital step.

“Record inflation has translated to higher prices on basic necessities, and is kicking Americans when they are down when it comes to footwear in particular. This price pressure on clothes, shoes, and backpacks is ill-timed with the need to get back-to-school essentials,” he adds.

The AAFA sent a letter to President Biden before the Executive Order was announced, highlighting as 98% of all apparel, footwear, and travel goods sold in the United States is imported, the industry’s more than three million American workers depend on a smooth supply chain.

“Rail, particularly intermodal, has become an increasingly important piece of the puzzle as we work to bring the right clothes, shoes, and accessories to American families at the right time, and at the right price,” the letter stated.

Biden’s Executive Order, which states “keeping supply chains running means keeping America’s railways running,” establishes a Presidential Emergency Board to help resolve the dispute between rail carriers and their unions.

It states: “In making the decision to create the Presidential Emergency Board, the President has considered input from relevant stakeholders. The President’s goal is to make sure America’s freight rail system continues to run without disruption, delivering the items that our families, communities, farms and businesses rely on.”

“The Presidential Emergency Board will provide a structure for workers and management to resolve their disagreements. The board plans to investigate the dispute and, within 30 days of its establishment, deliver a report recommending how the dispute should be resolved.”

The Executive Order will also trigger a “cooling off” period intended to keep the parties working toward a negotiated settlement.

Herman adds: “We applaud President Biden for taking this critical step to keep the parties at the negotiating table and help the two sides reach an agreement.”

Last week, the AAFA said an end to Section 301 Tariffs is the solution to rising US inflation levels as official June figures revealed overall inflation was up 9.1% versus last year with apparel increasing 5.2%.

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