SIC 3172
PERSONAL LEATHER GOODS, EXCEPT WOMEN'S HANDBAGS AND PURSES



This category covers establishments primarily engaged in manufacturing small articles normally carried on the person or in a handbag, such as billfolds, key cases, and coin purses of leather or other materials, except precious metal. Establishments primarily engaged in manufacturing similar personal goods or precious metals are classified in SIC 3911: Jewelry, Precious Metal.

NAICS Code(s)

316993 (Personal Leather Good (except Women's Handbag and Purse) Manufacturing)

The overall economic health of the personal leather goods industry is tied to the status of the domestic leather production industry as a whole. Both this small segment and its parent category are affected by many of the same problems in manufacturing, labor costs, and competition with foreign-made products. The products manufactured by this industry are sometimes referred to as flatgoods due to their small dimensions; they are generally designed to fit into pockets or handbags. Such items include wallets and billfolds, coin purses, and key and cigarette cases; these goods may be manufactured wholly or partially of leather, plastic, or fabric, or from a combination of these materials.

Wallets and billfolds have historically represented the largest production segment of this industry, accounting for almost a third of all goods produced and more than 75 percent of the total monetary value of shipments in the late 1990s. Travel kits are the next largest portion of the flatgoods market, followed by jewelry boxes and small items such as key and eyeglass cases. Typically, manufacturers offer several product lines each season in a variety of colors and prices. Many of the products are interrelated, meaning consumers of both sexes can purchase a wallet and accompanying accouterments in a single style at the department store counter, traditionally the largest retailer of such products. This industry category also includes such items as watchbands, compacts, and business-card cases, if made from leather.

According to U.S. Department of Commerce estimates, the value of shipments for this segment of the leather manufacturing industry totaled $354.7 million in 2000, down from $465.2 million in 1997. The total number of employees in this segment of the industry fell to 4,600 in 2000 from 5,215 in 1997 and from 6,400 in 1990. The number of production workers in the industry, a figure that has generally accounted for nearly 80 percent of all workers engaged in the industry, stood at 3,700 in 2000, down from 3,800 in 1997 and from 5,200 in 1990.

The number of firms engaged in the production of flatgoods has been in decline since the early 1970s. Approximately 244 firms were classified as manufacturers in this industry in 1972, but by 1987 that number declined 15 percent to 208. By 1995, there were approximately 166 establishments in the industry. The number increased slightly—to 174—in the late 1990s. The largest number of establishments was located in California and New York.

Since the early 1970s, the personal leather goods industry in the United States has been dramatically affected by foreign-made products. Due to the skilled nature of the work, labor costs for domestic manufacturers are relatively high. The estimated average hourly wage in the industry was $8.46 for a production worker in 2000. Foreign manufacturers, most notably in China, Korea, India, and Italy, can produce flatgoods at a greatly reduced cost due to significantly lower wages. Because of this, the American consumer market for these products has become saturated with imported wallets, key cases, and eyeglass cases that have lower retail prices than their domestically produced counterparts.

In 1995, the United States imported $475 million in flatgoods. However, while imports continue to increase, so do exports of domestically produced flatgoods. A strong dollar and increased trade with Japan and Canada have helped to double the amount of exports since 1989. Industry leaders in the late 1990s included Tandycrafts, Inc. of Fort Worth, Texas, and Aristocraft Leather Products of Northvale, New Jersey.

Further Reading

United States Census Bureau. County Business Patterns. Washington, D.C.: GPO, 1996

——. "Manufacturing-Industry Series." 1997 Economic Census. Washington, D.C.: GPO, 27 July 1999.

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

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