The Global Economy -  In Action

There was an article in Thursday’s edition of the Wall Street Journal, November 12th , that should be a business school case study. It should also be required reading for all of our congressional representatives in Washington.

 The title was “ Furniture Maker Brought Jobs Back to U.S. It Didn’t Work”

“Effort to stay ahead of changing U.S. trade policies ended with a factory closing” by Stu Woo.

 The furniture company was TOV Furniture. Owned and operated by  Boris Krinsky and his wife, since 2009. They started the business  by purchasing a website that sold furniture made by other companies. Boris was apparently unhappy with the style and cost of the furniture and decided to look into manufacturing their own line.

 His wife was a teacher and she designed a furniture line of their own.

 He researched who was making some of the furniture he was selling on his website and found the name of a Chinese manufacturer. He arranged to go to Shanghai where the factory was located.

 This was the beginning. He realized that China had an incredible manufacturing system, at lower costs than in the U.S. Within a few years he had seven Chinese manufacturers making furniture for them, including a sofa that he sold for $900.00.

 Chinese good were allowed into the U.S. then, without the tariffs that exist today. They expanded their line of furniture, and soon,  annual sales were exceeding $100 million.

 Their market in the U.S. was hotels, consumers through the internet, restaurants and retailers like Costco. Today, they are also a mainstay on Amazon.

 During President Trump’s first term in office, everything changed. Trump imposed a 25% tariff on Chinese furniture.  Krinsky was able to convince, one of his main Chinese suppliers, to set up a factory in Vietnam to minimize costs. He was able to offset the tariffs, by getting his Chinese manufacturer to lower their costs, and by purchasing direct from the Vietnam factory.

 In leading up to Trump’s second administration, it appeared that higher tariffs would be imposed on China, if Trump were reelected. This would be a disaster for TOV Furniture.

 Brinsky convinced one of his Chinese manufacturers to open a second facility in Vietnam. Construction began in August 2024 and was completed in March 2025. At this point, Krinsky felt that all was good.

 The second factory employed 130 people . Pay for an upholsterer amounted to approximately $8,000 a year. That compared to $90,000.in the U.S.

 However, after taking office in his second term, Trump presented a new trade policy that was intended to increase manufacturing in the U.S.  Tariffs were increased by 34% for Chinese goods and a tariff was proposed of 46%, on Vietnamese goods.

 The couch that they originally sold for $900, had increased to $1,250, through inflation and supply chain increases. With the additional 46% proposed tariff on Vietnam goods, the retail price would now have to be almost $2,000. At that price, it was a no starter.

 All of their other furniture, was also in the same place, cost wise. Not saleable.

 Krinsky decided to see if it would be possible to manufacture some of his furniture in the U.S., to mitigate the tariff situation.

 After researching available facilities, he found a factory in High Point, NC that was on the verge of closing. He was able to take it over at no cost. The current owners had a backlog of $2.4 million in orders, but had run out of cash.

  Krinsky took over the business and believed that he could produce his couch, and sell it, for $1,500.  He would avoid the tariffs and ocean freight, but his estimated cost was still $1,230. At a sales price of $1,500, he had $270 for overhead and profit. A very slim margin.  He thought that he would be able to affect additional cost savings, at the factory.

 However, the furniture industry in North Carolina, had seen the employment go from 91,000 in 1990 to 27,000 in 2025. Additionally, the salary for a beginning upholsterer was $45,000, and for an experienced one, $90,000.

 There was also a significant shortage of upholsterers, as well as other skilled furniture workers. The industry had an aging population.

 The Chinese and Vietnamese work force was significantly younger, compared to the U.S. work force.  As a result, the Chinese and Vietnamese  work force  produced his couch at a rate of 10 per day, compared to 2 to 3 per day, in High Point.

 He quickly realized that manufacturing in the U.S. wasn’t the answer. Ten months into this process, he decided to close down the High Point factory. They had lost over $3 million, and there was no positive recovery, on the horizon.

 Fortunately, at the time that he closed his High Point factory, the Supreme Court had struck down global levies. Trump , however, reinstituted tariffs of 50% on upholstered furniture from China and 25% from Vietnam through an executive order.

 The lower tariff rate in Vietnam caused Brinsky to move most of his furniture purchases to Vietnam. Today, 70% of his furniture is produced in Vietnam.

 This is a classic case of the impact that tariffs have on the Global Economy.

 In this case, the furniture industry, in this country, is almost non-existent. Attempting to resurrect it, is almost impossible. We don’t have the work force and our costs are significantly higher than in other countries.

 The tariffs get passed on to the consumer and are certainly not cost effective. They are not, or will not, achieve the objective of  bringing manufacturing back to the U.S.

 We are a service economy today. Manufacturing doesn’t drive our economy as it once did. If our officials would take the time to understand that, and realize the benefits of a Global Economy, we would all be better off. We would  see significant savings in the goods and services that we use daily. Tariffs are not the answer.

 In the early 1970’s, my family and I lived in North Carolina. The furniture industry was centered on the High Point area, and  I had friends that were involved in that industry. The shift to offshore manufacturing began then. Cost was a major contributor.

 Nationwide, employment in the furniture industry, in 1990,  was approximately 601,700. Today, it is 329,500, or approximately 272,200 fewer jobs.  This is a 45% reduction in employment nationwide, compared to 70% in North Carolina.

 This trend is similar to the trend in the textile industry. In 1990, North Carolina had 216,000 employees in textile manufacturing. Today, there are approximately 24,000, or a reduction of 192,000 or  89%.

Nationwide, there were 727,400 employed in textile manufacturing in 1990. Today, there are approximately 170,700, or a reduction of 556,700 jobs, or 77%.

These jobs are not coming back. It is time that our government recognizes this and moves on.

The Global Economy is real. We need to embrace it, not deny it.

 Jess Sweely

Madison, Virginia

November 14, 2026