Mass layoffs have begun at American Apparel’s Downtown Los Angeles factory, following Gildan Activewear’s purchase of the company’s intellectually property rights for $88 million at a Bankruptcy Court auction last week.
Of Gildan’s current 42,000 employees, 90% are based in low-cost Caribbean and Central American countries. That, coupled with the company’s track record of labor abuses, has many fearing AA’s core values will fall by the wayside under its new leadership.
In addition to offering comprehensive healthcare and benefits, livable salaries, and support on social issues such as immigration reform, AA also proved that clothing could be desirable, affordable, and exploitation-free.
And though myriad sexual harassment allegations and the loss of their hipster cache were major contributors to the company’s demise, AA’s collapse also symbolizes a troubling cultural shift – one where consumers would rather spend less money on clothes produced with exploitative labor, than spend more on responsibly-produced goods that benefit those who made them.
You can read more about the fate of American Apparel at Business of Fashion.
