Workplace Issues

Nike Planning U.S. Expansion If Trade Deal Passes

Nike says it will create 10,000 manufacturing and engineering jobs in the U.S. if the White House can push through the Trans-Pacific Partnership ag...
Matthew HellerMay 8, 2015
Nike Planning U.S. Expansion If Trade Deal Passes

In an announcement with an ironic subtext, Nike said Friday it would start making shoes in the United States again if the 12-nation Trans-Pacific Partnership trade deal becomes a reality.

The footwear company’s announcement was timed to coincide with President Barack Obama’s visit to its Beaverton, Ore., headquarters, where he urged Congress to pass prerequisite legislation for the TPP. The bill would allow Obama and his successors to negotiate trade agreements with minimal input from lawmakers.

The footwear tariff relief provided under the TPP would allow Nike to “accelerate development of new advanced manufacturing methods and a domestic supply chain to support U.S. based manufacturing,” creating up to 10,000 manufacturing and engineering jobs in the U.S., the company said in a news release.

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

“Free trade opens doors, it removes barriers, it creates jobs, it lets us invest more in the things that matter,” Nike CEO Mark Parker said in introducing Obama. “That’s innovation, that’s creativity, that’s people.”

“What this trade agreement would do is open the door to the higher-skilled, higher-wage jobs of the future, jobs that we excel at,” Obama said.

But critics of the TPP noted the irony of Obama pitching the deal at a company that, according to The Washington Post, has become “a symbol of outsourcing, eroding corporate labor standards, and the dark side of globalization.”

“Nike isn’t the solution to the problem of stagnant wages in America. Nike is the problem,” former U.S. Secretary of Labor Robert Reich said in a post on his website.

As The New York Times reports, while Nike employs about 26,000 people in the United State, its contract factories overseas employ about one million people, roughly a third of them in Vietnam. “Labor activists have long complained that wages are low and that worker rights are routinely violated in such countries,” the Times said.

In 1998, Nike founder Phil Knight warned that returning shoe production to the United States would add $100 to the cost of a pair of Nike shoes, which then averaged about $75.

“U.S. manufacturing would allow Nike to deliver product faster to market, create innovative performance footwear, provide customized solutions for consumers, and advance sustainability goals,” the company said in its statement Friday.

Featured image: Thinkstock