The last two weeks have not been pleasant for Dov Lautman. They said he was causing unemployment, they said he was heartless, that employees were nothing to him and that all he cared about was the bottom line. He was even accused of compromising the peace process.
It all started two weeks ago when Delta Galil (of which he is chairman and in which he is a major shareholder) announced it was closing the sewing factory in Hurfeish and firing 120 workers. There is nothing you can say to a person who has just lost his or her job. To them it's the end of the world and no explanations can make them feel better. But this should not stop the rest of us from a level-headed analysis of the situation.
Delta has done more than fire 120 women workers in Hurfeish. It fired hundreds of others over the last few years when it shut down many factories in the Galilee and moved its production lines to Jordan, Egypt, Romania, Bulgaria and even Honduras.
There were others in the textile industry who didn't do the same. They failed to see where the wind was blowing and could not understand the meaning of competition in a world in which anyone anywhere can manufacture and market socks to the four corners of the earth. Because they were reluctant to start an operation in other countries, these other factory owners have gone bankrupt. All of their employees lost their jobs, but they nevertheless looked great in the media - because they lost the game.
Lautman, on the other hand, did not lose. He realized in time that he had no choice but to follow the same practices as the rest of the western world, namely, relocate simple labor to cheaper countries and keep the sophisticated and more lucrative jobs in his home country. Because there is more to the textile industry than sewing. There is also knitting, dying, curing, purchasing, logistics, finance, fashion design and management - all of which still take place in Israel.
Moving the sewing lines elsewhere enabled Delta to remain profitable, invest, grow and generate $600 million in sales all around the world. It also enabled the company to go on employing 12,000 people worldwide, 3,000 of them in Israel (including 1,500 Arabs and Druze). Incidentally, these 3,000 - or 25 percent of Delta's payroll - account for 60 percent of what the company spends on wages. Now is that so terrible?
If you want to survive, you have no other alternative. The cost of employing a sewing worker here is $900 a month, while in Jordan, Egypt, Bulgaria, Romania or Kazakhstan, it is only $150. This is why there is not even a single sewing plant in Europe, even in Greece or Portugal where the cost is only $600. Manufacturers have even started to move plants from Turkey, where the monthly cost of wages is $300 per worker, to Kazakhstan - because global competition dictates that this must be done.
But Lautman need not despair: His glory days with the media may yet return. This will happen when the political situation forces him to urgently shut down a plant in Egypt or Jordan, or when his balance sheet turns red, or when something else negative happens to Delta. Because Israel just doesn't like winners.
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