Founded in N.E., exported to China

STOWE, Vt. -- It was a perfect day for snowshoes. A deluge of fluffy flakes had added nearly a foot to the snowpack. All over this mountain village, vacationers were strapping on Tubbs snowshoes, the iconic New England brand that revived a once-dying industry and has most recently been manufactured here within the shadow of Mount Mansfield.

But the inside of the Tubbs factory was as quiet as a forest trail.

The riveting machines were silent. A few of the remaining workers were packing up. The manufacturing equipment had been crated. A trailer was parked outside the factory, ready for the ocean voyage. All that remained was for factory manager Joel Foster, a 15-year employee, to head to China himself and teach the Chinese how to make snowshoes on the aging machines. Then, Foster's job, like those of several dozen assembly line workers, will no longer be needed.

"There is nobody here to manage anymore," says Foster. "We are victims of our own success."

The tale has become increasingly familiar. Of the top 10 states losing jobs to China, as a percentage of the total workforce, five are in New England -- Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont -- according to a study released by the Economic Policy Institute last month of job losses between 1989 and 2003.

The trend is emblematic of what analysts call a third wave of US business relocating to China in the last two decades. First were firms that hoped to sell directly to the Chinese. Second were firms that hoped to lower costs and resell to the US market. Now, there are firms such as Tubbs that fear competitors already outsourcing to China and decide to move there themselves to match labor and other costs.

While Tubbs is in many ways a classic jobs-to-China story, the Tubbs tale is unique. The owner who sold out his company, Ed Kiniry, is not vilified by his employees. The workers interviewed for this article praised him and said they understood why the move had to be made. Indeed, Kiniry is hailed as the savior of the snowshoe business, transforming it from a backwoods business to one just as likely to sell to urban professionals.

Founded in the town of Norway, Maine, in 1906, Tubbs supplied snowshoes to the South Pole expedition of Richard Byrd and to the US armed forces during World War II. Hunters and woodsmen made up the bulk of the customers for many years. By the time Kiniry bought the brand in 1987, it was hardly a sure thing to pour money into a one-season-a-year business that depends on fickle weather. But Kiniry, an avid outdoorsman, believed he could sell lightweight metal snowshoes with fancy bindings to the booming recreational market. By last year, production had climbed to 110,000, of which only 400 were the old wooden variety.

Kiniry, 60, whose hometown of Springfield, Vt., lost its machine tool industry during his youth, looked visibly pained as he sat in his office and explained how the jobs he created wound up going to China. Just two years ago, Tubbs was named Vermont's "Exporter of the Year" by the state's Chamber of Commerce. But Kiniry said he was already facing pressure from Chinese competition, and he decided to sell the $20 million firm to the giant sports equipment maker, K2, which employs 8,000 people at a facility in Guangzhou, China.

While the deal didn't require that the Tubbs manufacturing move to China, Kiniry said, "I would be lying if I didn't say I would have expected that to happen. Their strategy is to do low-cost manufacturing."

K2 quickly made plans to move the manufacturing jobs to China, while keeping a dozen other jobs in Vermont.

As it happened, on the very day last week that the Tubbs equipment was prepared for loading on a freighter to China, Vermont's lone US representative, the self-described socialist Bernard Sanders, was in Washington, giving a press conference at which he said he was introducing legislation with 66 cosponsors, including 17 Republicans, calling for the repeal of normalized trade relations with China.

Sanders said Vermont has lost 20 percent of its manufacturing jobs in the last four years, with companies moving to China, and India, Mexico, and other locations. But Sanders is particularly upset with China because that country is paying such low wages. The US trade deficit climbed nearly 24 percent last year to a record high, with the largest gap occurring with China, which exports $162 billion more to the United States than it buys.

The legislation faces opposition from President Bush, who favors open trade relations with the world's most populous nation. Supporters of the China trade policy say there are benefits that will grow in the future. A recent commentary in Business Week magazine noted that 10 of the top 40 exporters from China are US firms, and that many US companies such as Wal-Mart depend on Chinese goods to stay competitive.

Still, a number of legislators are calling for tariffs on some Chinese products, if not revocation of the favorable trade status. Critics also have accused China of undervaluing its currency to make exports cheaper.

"If you are an employer and you don't give a damn about your workers and you don't give a damn about your country, going to China makes perfect sense," Sanders said in an interview. "They pay workers as low as 30 cents an hour, workers can't form unions, there is virtually no environmental protection and by and large workers can't stand up for their rights. That is their climate. You can't compete against that."

A 'sad circumstance'At the headquarters of K2 Sports in Vashon Island, Wash., company president Robert Marcovitch says he is in the smile business. "The object of the exercise is putting smiles on people's faces, to make them smile brighter and longer, to make them forget about their anxieties," Marcovitch said in a telephone interview.

Marcovitch said it is a "sad circumstance" that some Tubbs workers are losing their jobs. But he said he did the math and concluded that it was better to move the jobs to China than lose them altogether to Chinese competition.

Asked to respond to Sanders' allegations, he stressed that K2 has arranged retraining seminars and provided severance packages, and said the company's decision to keep about a dozen nonmanufacturing jobs in Vermont showed its commitment to the region. He speculated that some other companies in the same position would have "shut the entire thing down." (Three jobs related to wooden snowshoes also remain, at least temporarily.)

"It is quite frankly sad but true [that] when you are in a business and have our competition lead the way, we find ourselves having to do that," Marcovitch said of the move. "I don't think that it is any secret that certain jobs are susceptible in this country as a result of the cost of labor over there."

The move of US jobs to China has accelerated in the last few years. The report by the Economic Policy Institute, a self-described nonpartisan think tank, said that 1.42 million US jobs were lost to China between 1989 and 2003. As a percent of the state's workforce, Maine was the top loser, with 2.47 percent of its jobs going to China during that period. Massachusetts was in seventh place, sending 1.46 percent of its jobs to China, and Vermont was in ninth place, at 1.41 percent. No state reported a net gain in jobs due to China trade.

Packing upOne of the last workers to pack up the snowshoe equipment was Tom MacGregor, who toiled near a sign that said, "0 days left. Way to go Tubbs. We kicked some snowshoe Butt!"

"It feels really strange packing six years of my life in the bottom of a container," said MacGregor, who invented some of the equipment that Tubbs used in its manufacturing process. "Consumers want to buy things at a price that is cheaper than they would be willing to be paid to make it."

Another soon-to-depart employee, Janus Stokes, knows that he works in the ultimate service industry town, filled with waiters and ski-lift operators, but he hopes to find work in the state's shrinking manufacturing sector. In the meantime, he found a bright note, musing that his son, Aaron, who learned to read and write Chinese long before the Tubbs move was revealed, one day might profit from that knowledge in selling website designs in the future.

As for Foster, the former plant manager, he is looking forward to his first trip outside North America, even if it is to train Chinese to take his job. "I'll teach them everything I know," Foster said. "I really want to be able to instruct them on the proper way to do it. I really do have pride in the brand and I want it to be successful [even though] it has been pulled out from under us, so to speak."

Michael Kranish can be reached at kranish@globe.com.