New Balance Factory Persists Despite Statewide Mill Decline
by Dominic Giardini
Oct. 2018 saw the first shipment of New Balance shoes from Maine to the U.S. Department of Defense as part of a $17.3 million contract to ensure that military personnel are provided American-made footwear. The 18-month deal, providing considerable economic benefits through job growth, marks a massive achievement for Maine’s New Balance Shoe Factories in Norridgewock, Skowhegan and Norway, where 900 workers are now employed.
Maine Senator Angus King, bolstered by efforts in the House of Representatives by Bruce Poliquin, had pushed for recognition of the 1941 Berry Amendment as part of the 2017 National Defense Authorization Act. The amendment calls for the implementation of wholly American equipment to be used by the U.S. military, as shoes in circulation at the time did not meet this standard. This success story marks a pattern-breaking phenomenon in Central Maine, where many manufacturing companies have struggled tremendously since the 1980s. In the greater Waterville area in particular, large, imposing skeletal remains of a once-flourishing industrial past characterize the architecture.
For instance, the expansive brick mill formerly owned and operated by the Scott Paper Company, closed since 1997, sits idly across the Two Cent Bridge on the Kennebec Riverfront. Maine mills originated in the southern part of the state during the early 19th century. Biddeford, Saco, and York formed an impressive textile industry, with Saco Manufacturing constructing the country’s largest textile mill at the time in 1825. Manufacturing expanded throughout the century to include cotton mills, iron foundries, cigar factories, shipbuilding companies, as well as brick making and granite industries. Paper mills, now constituting Central Maine’s last remaining manufacturing sectors, have recently suffered tremendous hardship due to a decline in demand for the product. Both the future of the paper mill industry and forest products industry are in jeopardy, a daunting economic reality for the state.
A May 20 report by the Portland Press Herald notes the closure of five paper mills since 2014, resulting in a loss of over 4,000 jobs. Such sudden disappearance in jobs creates a powerful systemic issue for towns that rely on said labor and industry. The 2016 closing of a paper mill in Madison, Maine, for example, displaced 214 workers in a town of 4,600, delivering an economic shock that the town is still struggling to recover from. Considering the distressing regression of Maine manufacturing in recent years, the New Balance deal marks a vital shift within this sphere, remedying job loss with the pivotal promise of new opportunities in a similar field. So, how has New Balance achieved its antithetical success amongst declining mill towns? The company, while based in New England, extends its reach multinationally, and is thus able to draw profit from outside of the region.
Further, the New Balance brand enjoys considerable versatility, with widely ranging shoe styles and affordability that draws customers of various demographics; notably, factories differ from the regular New Balance stores in that they sell cosmetically flawed factory seconds and discontinued styles at a discounted price, optimizing the brand’s accessibility. As of 2018, New Balance has expanded upon their running shoe collection to re-establish their basketball division, signing NBA star Kawhi Leonard to a multi-year endorsement deal. New Balance’s strong, international presence allowed for Maine lawmakers to advance convincing legislation. The legislation provides a crucial accomplishment for a floundering manufacturing sphere. Caleb Love-Webb ’21, a Maine native, reflected on his experience shopping at the New Balance Factory. He offered a less optimistic take on the news, despite appreciating the contract’s economic benefits, “I like shopping [at the factory] because I want to support what Maine jobs are left. However, I also know that New Balance products are foreign made, so I feel like it’s kind of dishonest how much they brand their stuff as U.S. made.”
A study from the Made in America Movement Organization reports that while New Balance manufactures a quarter of their shoes in New England factories (compared to 98% of total U.S. shoe sales coming from imports), they concede that only “70% of the value of its Made in USA shoes reflects domestic content and labor. The outer soles… are imported from China… clashing with what the U.S. government says can be labeled ‘Made in USA.’” New Balance has held on to the right to label their products as American made, despite legal efforts by the Federal Trade Commission to prevent this practice. However, the company exhibits transparency and stands by their right to include the label despite them facing criticism. “Anything our government buys should be USA made, not made by our potential enemies,” LoveWebb continued, “but I don’t doubt that if New Balance stopped being able to charge a markup for U.S. made goods they’d leave Maine in a second.” Love-Webb’s cautious approval of New Balance’s Maine occupancy elucidates well-warranted concerns underlying the company’s outwardly positive local manufacturing presence.
