New trade agreement may hurt U.S. jobs, not help

According to the latest unemployment report, American manufacturers added 24,000 jobs last month.

But in Skowhegan, Maine, more than 300 manufacturing jobs could be on the line, as they face stiff competition from overseas.

CBS News correspondent Anthony Mason reports that the looming trade agreement between the U.S. and several South Asian countries could unbalance an iconic American product.

Skip Bowman knows his company, New Balance, would make more money if it shut down the plant and moved his job overseas.

"Every day I walk through that door I am a part of the effort to keep this factory going," Bowman says.

New Balance is the last major brand to produce athletic shoes in the U.S. About 25 percent of its manufacturing is still in New England, where it has operated for nearly 100 years. The privately held company says it is committed to its American workers.

"If they were thinking about the bottom line and only the bottom line at all times, we wouldn't be here," says Pat Welch, plant manager.

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That reality is not lost on the more than 300 people who work here. They work fast; 220 pieces move through 33 pairs of hands with efficiency. It takes 19 seconds to stitch and inspect each piece - less time to glue the soles. The results are significant.

In 2004, it took 8 days to finish a pair of performance shoes. Today, this group finishes in less than 3 hours

"The quicker we make the shoes, the cheaper it is," says Sarah Clark-Therrien, New Balance employee.

Despite their efforts, a new threat has emerged. It's a trade agreement being pushed by the Obama administration called "The Transpacific Partnership," which would open eight developing markets - Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam - to U.S. goods.

The goal of the agreement is to create jobs here, but it also removes a steep import tax on Vietnamese-made sneakers, which could actually threaten jobs at this plant.

"If this tariff were lifted, it's not gonna help our business out," says New Balance Plant Manager Welch.

The bottom line is that, no matter how efficient, Americans are 10 times more costly than Vietnamese workers, making the costs per shoe much lower.

"This trade agreement makes me and the staff nervous because it's gonna reduce our competitiveness in making shoes domestically," Welch says.

But New Balance bosses say they will stand by their workers. By adjusting its product line, or its prices, the management has vowed to keep the doors open.

"We will not lay off any of our associates," says New Balance VP of Manufacturing John Wilson.

"They're out there on a limb all by themselves, and we are their limb," says New Balance plant worker Ray Ellis. "We've got to hold them up, so we have to do our part."

  • Anthony Mason

    CBS News senior business and economics correspondent; Co-host, "CBS This Morning: Saturday"