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A Furniture Industry Renaissance?

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At its peak in the 1980s, Basset Furniture Industries employed roughly 9,000 people, with the largest concentration in Martinsville and Henry County. One of the largest furniture manufacturers in the world, the company provided jobs not only for machinists and assembly workers on the factory floor, as one would find in any mill town, but middle-class jobs in furniture design, sales & marketing, and administration, as well as high-income executives. Bassett, a census-designated place of little more than 1,000, was surely one of the smallest communities in the United States to boast its own country club and golf course.

The rise of China and the advance of globalization decimated Bassett Furniture and its namesake community. Actually, “decimate” does not come close to describing what happen to the company. The word is derived from the ancient Roman practice of killing one of ten soldiers as punishment for the entire unit. Bassett shed more than nine of ten jobs, hitting bottom around 800 employees early in this century, as it dismantled its manufacturing operations and hung on as a designer, distributor, retailer and importer of mostly Chinese-made furniture.

Today, there are signs that the tide has turned, reports the Roanoke Times. Bassett’s emphasis on custom-built furniture, providing a choice of 1,000 upholstery fabrics, and free in-home design visits seems to be paying off. The company resumed manufacturing in Bassett in January, and announced plans to build an upholstery manufacturing center in Texas to produce sofas, love seats, sectionals and chairs. Total employment, including Zenith Global Logistics, a freight line, has rebounded to 2,400.

Bassett is illustrative of broad economic trends that portend better times for the American manufacturing sector and employment of blue collar workers whose livelihoods have been shattered by globalization and automation.

In the late 1970s, when I was cutting my teeth as a business reporter in Martinsville, furniture manufacturing was a low-wage, semiskilled industry. Bassett and other Virginia and North Carolina furniture manufacturers had gotten their start in the pre-World War II era by tapping cheap labor off the farm. The business strategy worked for decades — until China emerged as a global competitor with even lower cost labor. Furniture companies led the move to “off-shore” manufacturing operations overseas. Since then, American blue collar wages have stagnated while Chinese wages have soared, eliminating much of the labor cost differential. Now furniture companies are participating in the re-shoring” phenomenon — the shifting of manufacturing back to the United States. Fortunately, while the Chinese came to dominate the manufacturing end of the business, they never penetrated the U.S. sales, distribution and retail segments of the business. The preservation of those core functions has allowed American companies to rebound.

Meanwhile, Bassett has developed a mass-customization strategy that requires faster turn-around times than is possible with a 30-day supply chain leading all the way back to China. While some furniture parts still can be machined and shipped from China to the U.S., Bassett needs an operation closer to home that allows final assembly and installation of upholsteryfabrics hand-picked by the customer.

The Roanoke Times article alludes to another niche that Bassett is building upon:

“The company’s new Bench Made line of high-end dining furniture features pieces handcrafted in red leaf maple by about 25 workers in a 30,000-square-foot space once used as a warehouse in Bassett. The workers carefully antique the Bench Made pieces with wire brushes and add tiny holes that resemble natural wormholes.”

There will always be a market for cheap, mass-produced furniture as well as semi-customized furniture for the working class and middle class with limited incomes. But the top 20% of the market increasingly is looking for furniture that is unique and distinctive, and that typically means hand crafted — the trend I described last week in “The Rise of the New Artisan Class.

Do these trends portend a comeback for Virginia’s furniture sector? I think that’s a reasonable hope, although any enthusiasm must be tempered by the reality that job creation will be modest — advances in automation mean far fewer workers are required on the assembly line than 30 years ago — and far from sufficient to restore the economic fortunes of Southside Virginia. Still, anything that staunches the bleeding of jobs is a positive sign. And anything that actually brings even a few jobs back to the region is cause for celebration.

(This article first ran in Bacon’s Rebellion on November 30, 2015)

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