The case for change in Borders textiles industry

SPECIAL FEATURE

A treatise on the obstacles and opportunities within the Scottish Borders woollen industry may sound like an unlikely subject for an award-winning academic based in faraway Los Angeles.

But for distinguished research Professor Allen J Scott, from the University of California, it was an opportunity too good to miss, allowing him to rediscover his ancestral roots in Hawick while investigating for a well-received paper which could point the way forward for the region's surviving knitwear and textile manufacturers.

As UK-born Professor Scott told us, his grandfather William Scott (1847-1928) was a foreman in a Hawick factory, and also spent time in New Zealand. Mr Scott and his wife, originally from Denholm, are both interred in Hawick's Wellogate Cemetery.

Professor Scott's research findings urge a greater degree of inter-company co-operation within an industry which has, in the past, prided itself on its independent ways. And, he believes, there needs to be a greater role for the Galashiels-based School of Textiles & Design.

Many of the professor's previous research projects centred on industrial clusters in urban centres around the globe. His finished Borders paper entitled:  The changing fortunes and future prospects of a traditional industrial cluster: Woollen textile production in the Scottish Borders deals with a mere 27 businesses employing around a thousand people between them. A far cry from the labour intensive heyday when 12,700 workers had jobs in the local mills.

An abstract from the detailed paper states: "I argue that the Scottish Borders region lacks many of the pooled competitive advantages typically found in successful clusters but that carefully modulated policy could do much to improve local economic performance in the future. A number of specific policy guidelines focussed on inter-industrial relations, labour markets and institutional infrastructures are examined."

Professor Scott's objective was to offer an analysis of the historical development, organisational logic, spatial dynamics and competitive prospects of the woollen textile industry in the Scottish Borders region.

He found an industry which has inherited a long tradition of skilled craftsmanship and consistently high product quality and now almost entirely specialised in high-priced, fashion-orientated knitwear and woven fabrics destined for national and international markets. 

"Today, however, given the effects of global competition and relatively inelastic demand for woollen textile products, the industry has dwindled into a small residual cluster of firms, and its reserves of physical capital and its overall level of employment represent only a fraction of what they were in the more ebullient decades following the Second World War."

According to the professor: "The industry is thus faced at the present time with an array of puzzling predicaments but also with many latent opportunities. On the one hand, very tangible weaknesses are identifiable in the joint regional assets and endowments available to the industry; on the other hand, most individual manufacturers in the region are capable of skilled, superior-quality production, and despite the headwinds that they face are still able to maintain a definite presence on some of the world’s most exacting markets. In consequence of these opposing tendencies, a number of important issues must be addressed in regard to the current state of the industry".

And he argues that most of the surviving firms in the region have emerged in the aftermath of long-term restructuring trends with enhanced functional and managerial competence, though the current state of the region-wide woollen industry is unquestionably not all that it might be. The Scottish Borders woollen complex is plainly deficient in productivity-enhancing structures of local interdependence and collective order.

"A more elaborate groundwork of specialised external services is signally absent. Some firms engage in lateral subcontracting practices when their production levels come close to maximum capacity, but otherwise they are reluctant to tap into one another’s special competences, which means, too, that channels of information exchange are to that degree restrained. 

"An additional symptom of this low level of local functional integration is that spinning mills – once a basic component of the complex – no longer exist in the Scottish Borders, and most of the yarn for knitting and weaving is now imported from Yorkshire."

In Professor Scott's view the industry's deficiencies no doubt stem in part from the long tradition of individualism that prevails in the Borders region, but they also reflect the small overall scale of the industry which is unable to generate significant economies of scale and scope. Employees of knitwear and woven-cloth producers in the Scottish Borders are plainly not motivated to assume the risks that they would face in the sort of entrepreneurial experiments that are endemic in more vibrant industrial clusters, he says.

"Just as producers in the Scottish Borders seem to be averse to many of the inter-firm cooperative and collaborative practices observable in more successful industrial clusters so local labour markets display little of the vitality and resilience typically found in these clusters. Front-line knitting and weaving workers are certainly skilled and motivated, but signs of enervation are evident in the overall labour force which now comprises mainly older individuals, and new blood in the guise of habituated job-seekers is in short supply."

This is Professor Scott's take on the local School of Textiles and Design: "It is undoubtedly a critical adjunct to the local woollen textile industry, and a number of its former students can be found scattered around different mills in the region, but its potential role could almost certainly be much improved, most notably in view of the fact that a high proportion of its graduates leave the south of Scotland altogether for greener pastures elsewhere."

Despite the contraction of the sector in recent decades, Professor Scott strikes an optimistic chord when he states: "In spite of the evident hurdles faced by the woollen industry in the Scottish Borders, it retains a well-earned reputation for the excellence of its products and it continues to sell much of its output on some of the world’s most discriminating markets. 

"There is currently no explicit brand covering the region’s knitwear and woven fabric products as a whole, but the establishment of a common geographical indication (as in the case of Harris Tweed and Thai silks), possibly under the auspices of the World Trade Organization, is a prospective initiative that is obviously in producers’ interests. The surviving firms in the Scottish Borders possess significant competitive advantages in regard to their internal management and iconic product designs. But, as noted, there are readily identifiable voids in the local industrial system, suggesting that overall growth and market performance could be materially improved by appropriate remedial action." 

The paper concedes that the small size and limited number of producers make public intervention difficult "but all the more urgent". 

"Three points in particular must now be made. First, despite the indurated go-it-alone ethos of most producers, the possibility of constructing a more comprehensive system of inter-firm relations needs to be explored with a view, in particular, to the efficiencies that might be generated by more detailed vertical and lateral interlinkage and cooperation. Second, increased public support for skills formation is imperative as well as more effective orientation of the Heriot-Watt School of Textiles and Design to the region’s recruitment, research and entrepreneurial needs. Third, some sort of common information-scanning and intelligence-processing agency would undoubtedly help producers to keep abreast of relevant technical and economic trends and to sharpen their responsiveness to new market opportunities."

In conclusion, Professor Scott explains that the ravages of recent decades have assuredly taken their toll but are now to a degree in abeyance. The immediate future for the industry remains no doubt uncertain, though a case can be made for a scenario of at least short- to medium-term stabilisation.

"Spontaneous renaissance is an unlikely prospective outcome but some substantial resurgence may be envisaged given appropriate joint action directed to the reinforcement of localised competitive advantages and a resolute long-term effort to set the industry on a new evolutionary trajectory. Realisation of this projected state of affairs will manifestly require concerted leadership, planning and political action focussed on the development of a sufficient common pool of regional resources and capabilities. The alternative prospect, in all likelihood, is a future marked either by stasis or continued slow attrition."