SIC 2353
HATS, CAPS, AND MILLINERY



This category includes establishments primarily engaged in the manufacture of hats, caps, millinery, and hat bodies. Establishments primarily engaged in manufacturing millinery trimmings are classified in SIC 2396: Automotive Trimmings, Apparel Findings, and Related Products. Establishments primarily engaged in manufacturing hats and caps of paper are classified in SIC 2679: Converted Paper and Paperboard Products, Not Elsewhere Classified; those manufacturing caps of rubber are classified in SIC 3069: Fabricated Rubber Products, Not Elsewhere Classified; those manufacturing caps of plastics are classified in SIC 3089: Plastic Products, Not Elsewhere Classified; and those manufacturing fur hats are classified in SIC 2371: Fur Goods.

NAICS Code(s)

315991 (Hat, Cap, and Millinery Manufacturing)

Industry Snapshot

Approximately 389 establishments were engaged in the manufacture of hats, caps, and millinery (the design, production, and sales of women's hats) in the late 1990s. Altogether, these establishments were responsible for total product shipments estimated at $1.08 billion in 2000. Throughout the 1990s the industry experienced a modest recovery, due in large part to the fad-driven popularity of team logo sports headwear. This was a welcome development for an industry whose fortunes had been steadily drifting downward since the early 1960s, when a national trend toward hatlessness began.

In addition to team logo sports headwear, the industry's output included straw harvest hats; jungle-cloth helmets; opera hats; panamas; and hat bodies made from fur-felt, straw, and wool-felt. To professional uniform services, the industry supplied chauffeur caps, police hats and caps (excluding protective headwear), and various other uniform hats and caps.

Organization and Structure

Of the 389 establishments engaged in the production of hats, caps, and millinery in 1997, 305 (78 percent) employed fewer than 50 employees. All together there were some 17,000 people employed in this industry (14,000 of whom were production workers). The average hourly wage was approximately $17 per hour.

According to the 1997 Census of Manufacturers, the largest concentration of the industry's establishments was located in the mid-Atlantic region. In terms of the number of establishments per state, New York topped the others with 86, followed by California with 53, and Missouri with 37. Missouri, however, had the largest number of employees—3,245.

The industry leaders in 1998 give an idea of how the market shifted in just the past 10 to 15 years. Number one was Boston-based New Balance Athletic Shoe, Inc., with sales of $375 million and 1,100 employees. Second was Aris Isotoner of New York, with sales of $250 million and 200 employees. Hat Brands, Inc., which was ranked first in 1996, was ranked third in 1998, with sales (1999 estimate) of $180 million. Now known as Arena Brands, the company specialized in Western hats. These included Stetson and Resistol cowboy hats and Dobbs dress hats. "Name" hats obviously still carried a certain cachet, but sports and casual hats were still more popular.

In 1992 disaggregation of the industry's total output by its major product category indicated that cloth hats and caps, excluding millinery, accounted for a 56 percent share. Within this category, men's and boys' hats and caps dominated with 69 percent. It is important to note that the fad-driven growth in the sales of sports headwear bearing the team logos from the National Basketball Association, the National Football League, Major League Baseball, and the National College Athletic Association also fell within this major product category, but throughout the 1990s, their sales continued at a record pace.

The second major product category, accounting for 21 percent of the total output, was hats and hat bodies, except cloth and millinery. Next followed the classification of hats, caps, and millinery products, not specified by kind, accounting for 12 percent. The last major product category, responsible for 11 percent of the industry's total output, was millinery (women's, children's, and infants' trimmed hats made from hat bodies and other millinery materials). This included hats made from felt, straw, pile fabrics, and ribbon.

Background and Development

Prior to the more recent era of hatlessness, which took root during the suburbanization wave of the 1950s and 1960s, no respectable man or woman would have thought of leaving the house without a hat. The question of whether the hat industry would survive or not was unheard of during this time. Instead, of vital concern to the successful firms competing in the industry was their ability to produce and market an unending procession of new styles or modified variations of current popular styles. Since the life of a hat as a fashion accessory was typically short, the faster a firm was able to get in and out of a hot-selling style proved the key to its success.

Although not totally isolated from historical forces of technological change sweeping through other apparel industries, up until the 1990s opportunities to mechanize and automate the industry had proven difficult. As a result, production methods frequently required a great deal of handwork; therefore, labor-intensive manufacture has long remained the industry's norm.

Men's Hats. As the twentieth century began, most men living in urban areas of the United States wore hats. During the first decade, men could choose from a large variety of hats with each style purported to reflect the wearer's personality. One of the most prominent was the "princely" brown or black derby hat, which was available in three basic styles. At the time, most successful or aspiring businessmen sported the derby look. One of the more notable was the financier J.P. Morgan, who popularized a flat-topped version of the derby.

The manufacture of the derby was a time-consuming and labor-intensive process. Made from felt treated with repeated applications of a shellac solution, the material was heated and then allowed to cool. As it cooled, it took on its stiffened state. Next came an oven process, which softened it to the touch, followed by an iron mold process. To press the hat into its distinctive derby shape, a rubber bag was inserted inside the hat into which cold water was forced. Finally, the hat's brim was curled through a highly skilled operation that required a set of specialized tools referred to as "shackles."

Almost as popular as the derby was the fedora, which was made from soft felt. Except for its shaping process, the fedora's manufacturing process mimicked many of the steps involved in producing a derby. The hat was available in black, brown, and gray and received its name from the popular drama Fedora, penned by Victorien Sardou.

Though derby and fedora hats were to remain popular U.S. favorites for decades to come, a challenge to their popularity arrived in the form of the homburg. Made popular by King Edward's recreational visits to the town of Homburg in southern Germany, the homburg was of Tyrolean origin and featured a small brightly colored feather in its side band's bow. By the time the hat achieved mass appeal, it was mostly available in black and was worn with an informal evening jacket.

During the 1920s the U.S. men's fashion scene was heavily influenced by the British, particularly items connected to the pastimes of the Prince of Wales or associated with displays of wealth. For instance, in 1925, the English international tennis team showed up to play in Newport, Rhode Island, wearing brown snap-brim soft felt hats that the prince, just a short time earlier, had been seen vacationing in. These hats became the rage with wealthy crowds frequenting tennis matches and then proceeded to gain mass U.S. appeal. As an emphasis on dressing in style for leisure events and travel to warmer climates of the United States became more popular, panamas, which were woven from such lightweight materials as oatmeal, coconut, and rice straws, increased in popularity. Bangkoks and Ballibuntals, made from bamboo grasses or bamboo saplings growing wild in the Philippines, also became popular. Another lightweight favorite were Milan hats, made from Tuscan straw grown in Italy. Woven loosely, these hats offered protection from the sun and allowed for good ventilation.

Except for the affluent few, the era of the Great Depression knocked the demand out of the market for hats. Just the same, British fashion influences continued, as was evidenced by the sensation created by the "pork-pie" hat's arrival in 1934. A low-crowned hat of the telescope type and made from felt, the porkpie was first worn by well-to-do men who frequented polo games and horse races. Within a short time, the porkpie hat was accepted as appropriate attire for either business or casual settings. After its initial introduction in felt, the porkpie later became available in a variety of straws, including panamas, leghorns, and bangkoks.

Caps worn for purposes other than work also became popular during this decade. The checkered cap was deemed appropriate for golf and weekend motoring. For hunters, fishing enthusiasts, and country sports spectators, rough tweed caps were fashionable. Regardless of whether it was worn for work or leisure purposes, the production process for cloth-cap manufacture was practically the same. Cloth was cut by hand, usually with a manually operated knife, to ensure a precision pattern. The pieces were then sewn carefully to ensure that the cloth's design matched, with special attention paid to where the crown joined the visor. The cap was then steamed and ironed. Additional leather and linings were sewn in during the finishing stages. Should the cap be unlined, the crown seams were filled with tape so the threads did not appear on the outside of the cap.

With economic production geared toward military purposes, the war years of the 1940s witnessed little change in terms of style or material in men's hats. For the remainder of the decade, the war's aftershocks continued a dulling effect on the industry. By the early 1950s, the advent of manmade fabrics—many of which were washable and lightweight—dramatically transformed the material base from which most apparel garments were constructed. In turn, the reigning emphasis on lightweight materials translated into a boom for straw hats. Around the same time, the popularity of the low-crown porkpie hat increased, and the wearing of the small-shape strip tweed cap outside of its more narrowly defined traditional sporting events boundaries was common. By the decade's end, hats made from manmade material (such as nylon) displaced straw hats as they proved lighter in weight and came with more ventilation and durability.

The reversals in the industry's millinery branch appeared to be the most permanent. Although there were several short-lived, fad-driven waves, these were hardly sufficient to restore millinery back to the level of its formative years in the 1950s, when more than 400 companies supplied hats worn by the majority of U.S. women. By 1989 fewer than 80 companies produced millinery articles.

In the mid-1990s hats began to sell again as fashion accessories. To promote hats, 10 independent Chicago hatmakers formed the Millinery Arts Alliance in 1995. As department store sales increased in both 1994 and 1995, the industry seemed to be turning itself around, although to what level was still speculative. By 1997 graduates of New York's Fashion Institute of Technology, the only domestic school with a two-year millinery program, reached 500, 20 times the number of graduates in 1987.

Men's and boys' team logo sports headwear was the only other area breathing life into the struggling industry. Coupled with the increase in sales of hats as fashion accessories, this may have been sufficient enough to warrant a more optimistic outlook for the industry as a whole since data tracking the value of the industry's shipments for the period of 1987 to 1994 had risen significantly. In 1994 some of the top U.S. firms with leading market shares in the sports headwear market were: American Needle, Starter, Logo 7, A.J.D Cap, Drew Pearson, and Apex. In an effort to eliminate the high cost of sewing labor, some firms were experimenting with heat-applied techniques to join sports headwear fabrics. The result of these undertakings were mixed as some products proved to be of inferior quality.

Current Conditions

Between 1997 and 2000, the value industry shipments increased from $980.7 million to $1.08 billion, while the total number of industry employees declined from 17,237 to 16,263. For the most part, the leading firms in the sports headwear market became increasingly involved in foreign outsourcing, so while the industry's U.S. based firms prospered, the same could not be said for its U.S. workforce.

One path-breaking technology figuring largely in all sports headwear firms' success came with the introduction of quick response (QR) systems. Seldom has a system been devised that was so in line with the apparel industry's business climate where rapid change, high-stakes risk, and oftentimes fickle consumer behavior play so important a role. By design, QR programs electronically link textile manufacturers, apparel producers, and retailers into a computerized information network analyzing consumer sales information. Its ultimate purpose is to considerably shorten the turnaround time it takes for hot-selling items to arrive in retail stores, minimize system-wide inventory levels, and reduce or eliminate slow-moving articles to prevent unwanted markdown. In the late 1990s, other technological inroads were being forged through the application of computer-aided design and manufacture and laser beams used to cut cloth.

Legislation passed in the mid-1990s continued to affect the industry into the early 2000s. After the World Trade Organization was established in 1995, the Multifiber Arrangement (MFA)—which allowed importing countries to limit the flow of imports from lower cost, developing countries—was replaced by the Agreement on Textiles and Clothing (ATC), which required the phasing out of MFA quotas over a 10-year period. According to Linda Shelton in an Industry, Trade, and Technology Review report, "The elimination of MFA quotas likely will have a significant impact on the U.S. textile and apparel sector given the level of protection that such restrictions have provided domestic producers over the past two decades." Since the United States has until 2005 to implement the ATC, the legislation's impact on the hat, cap, and millinery industry might not be realized for several years.

Workforce

In 2000 the industry's total employment was 16,263 people, of which 13,713 were classified as production workers. Employment levels dropped off in the early 1990s but picked up later in the decade. Interestingly, however, the number of production workers remained relatively steady through this period, which suggested that any job loss was confined to management personnel. During the same period, when compared to other apparel industries—most of which experienced higher levels of decline for the categories of total employment and production workers—the hats, caps, and millinery industry fared rather well. To a large extent, the reversal of the industry's fortunes after several decades of decline could be attributed to the growing influence of team logo sports headwear sales and the resurgence of hats as fashion accessories in the mid-1990s.

According to the Bureau of Labor Statistics (BLS), sewing-machine operators by far constituted the industry's largest occupational category in 1996, accounting for 55.5 percent of all occupations. Several other occupational categories that fell just slightly above or below the 3.0 percent level were precision inspectors, testers, and graders; blue-collar work supervisors; and pressing-machine operators. Traffic, shipping, and receiving clerks accounted for 2.1 percent of all occupational categories. Based on the expectation that the industry would continue along a moderate path of productivity growth, a BLS survey forecasting the growth of the industry's occupational categories until the year 2006 indicated negative growth for all categories, with sales-related occupations being the lone exception. Sewing-machine and pressing-machine operators were projected to be the hardest hit as improvements in sewing technologies and new stitch-free techniques would exercise a displacing effect.

The industry's workforce demographics, especially in terms of its race and gender components, bore little relationship to their national average counterparts for the manufacturing sector taken as a whole. According to research conducted by the American Apparel Manufacturers Association in 1995, women made up 70.0 percent of the industry's workforce against a national manufacturing average of 31.6 percent. Workers of Hispanic origin accounted for 25.7 percent of the industry's employment compared to a national manufacturing average of 10.2 percent. African Americans comprised only 14.4 percent of the industry's workforce. This figure was similar to the black participation rate for the apparel industry group as a whole and was also only slightly above the national manufacturing average of 10.4 percent.

Further Reading

Albrizio, Ann, with Osnat Lustig. Classic Millinery Techniques. New York: Random House, 1998.

Chandler, Susan. "Heady Days for Milliners." Business Week, 13 January 1997.

Focus: An Economic Profile of the Apparel Industry. Arlington, VA: American Apparel Manufacturers Association, 1996.

Shelton, Linda, and Robert Wallace. "World Textile and Apparel Trade: A New Era." Industry, Trade, and Technology Review, October 1996.

United States Census Bureau. Manufacturing—Industry Series, 1999.

United States Census Bureau. "Statistics for Industries and Industry Groups: 2000." Annual Survey of Manufacturers. February 2002. Available from http://www.census.gov .



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