High and dry?

The closure of Arad Towels leaves residents questioning their city’s future.

By ANAV SILVERMAN
The Arad Towels factory stands empty (photo credit: ANAV SILVERMAN)
The Arad Towels factory stands empty
(photo credit: ANAV SILVERMAN)
There are three cities in the world that are called Arad.
One is in Romania, one is in Bahrain and the third is in the southern district of Israel. It is the Israeli city that has  local residents fearing for their city’s economic future following a series of layoffs and factory closures.
Located on the border between the Negev and Judean deserts, about 45 kilometers from Beersheba, Arad has an unemployment rate that is about 1 percentage point higher than the national average, which stands at 6.4% (not counting the recent layoffs). In October alone, more than 200 residents in Arad were laid off from one of the largest sources of employment for the city, Arad Textiles or, as it is more commonly known, the Arad Towels factory.
After 40 years of its iconic towel production, the factory was forced to close its doors in October after amass - ing losses that reached around $13.5 million over the past four years. To add to the blow, another Arad factory, Flextronics, which produces parts for defense electronics maker Elbit Systems, also announced in October that it would be laying off 23 workers.
It was an economic shock to the city of 28,000 people, where the towel factory at its height employed more than 700 workers and produced 1,200 tons of towels a month.
In the last few years, Arad Towels Ltd. began operating on a smaller scale after manufacturing was moved to Jordan, with management keeping 200 workers in the Arad plant. Output of its towel production went down to 70 tons per month, a decline of 95%.
Now the entire production line will be moved to Jordan.
“Getting the dismissal notice was shocking,” says 59-year-old Fanny Edery. “I’ve been working in the factory for 31 years, and it was very hard to hear that I was going to be laid off.
The factory was like home to all of us workers. It was a very warm place, and we had a lot of support from the owners.”
Edery moved to Arad from Ashdod in 1983 to raise her family in a “good environment.”
“People love Arad. There is a strong sense of security and a high quality of education in this quiet city. But all this means nothing if we don’t have jobs,” emphasizes Edery. “When a factory closes in Arad, the workers aren’t left with other employment opportunities. This is the periphery, not Tel Aviv. There are no job options here.”
Edery’s eldest daughter, a teacher, recently returned from Ashklelon to raise her children in her hometown because of the family’s proximity to the rocket attacks from Gaza.
But Edery is uncertain about her family’s future in Arad.
“We want to continue living here,” she says, “but we need the Israeli gov - ernment to help our city’s factories from going under so we can pay the bills.”
Yaron Harel, chairman of the Israel Textiles and Fashion Association at the Manufacturers Association of Israel, stated in a Globes report that “the high cost of inputs has made Israel one of the costliest places in the world to manufacture. CEOs who are based in the US and maintain production lines in Israel ask themselves why it’s worthwhile producing here in particular and not somewhere else.”
The answer to that question, at least while it was financially possible, for the American-Jewish owner of Arad Textile Industries, Gary Heiman, is Zionism. Three years ago, the Cincinnati-based president and CEO of Standard Textile – one of the top textile companies of the US and Europe – pledged NIS 1 million to help bail out Mitzpeh Atzma’ut’s sewing plant in the Negev.
“Part of my belief is that the periphery, and the Negev in particular, are important to the overall security of Israel,” Heiman told The Jerusalem Post three years ago. Heiman added that he had a “strong commitment to industry in Israel, especially the Negev.”
The Heiman family built the Arad plant in 1975 as a subsidiary of Standard Textile. When Arad Textiles opened in 1976, it started off with 30 employees.
Gradually, it grew to be one of the largest towel manufacturers in the world, also producing sheets, robes, blankets and other specialized items for hotels and hospitals. In Israel, Arad Towels provided supplies to the IDF, the Prisons Service, the Health Ministry and 70% of quality hotels.
International clients of Arad Towels included the US Department of Veteran Affairs, Emory Healthcare St. Luke’s Roosevelt Hospital, the Hilton, Sheraton and Four Seasons hotel chains and large laundry service companies in Europe.
The international clients were a point of pride for the workers of Arad Textiles, which employed immigrants from the former Soviet Union, Negev Beduin, Ethiopians, Arabs, Druse and Israelis.
“We produced towels that reached hotels in Las Vegas!” exclaims Edery, pointing out that Arad Textiles supplied towels to 60,000 of the 150,000 hotel rooms in Las Vegas. “I just don’t understand why the Israeli government hasn’t gotten more involved in supporting the textile industry here.”
“The recent factory closure didn’t just happen overnight,” says Josh Ashkenazi, the Arad Municipality’s spokesman. “This city has been suffering from government neglect for years.”
He cites the closing of the Motorola plant four years ago, which over time had laid off nearly 1,000 workers.
For Arad Textiles, the cost of production grew to be too much because the price of water, property tax, fuel and gas all increased in the last few years.
“We should be able to lay out a red carpet for entrepreneurs willing to invest in our city,” says Ashkenazi. “The state needs to find ways to encourage and not financially discourage factory operations here.”
Says Arad Mayor Tali Ploskov, “We are fighting for our home and for the future of Zionism. If Arad falls, all the Negev will fall. I am demanding from the Israeli government sustainable solutions, not just slogans.”
Arad was established in 1962 as Israel’s first planned city. Its sources of employment opportunities include the Telma food factory, leading games manufacturer Kodkod and Arad Dead Sea Products. Other sources of income include the service and tourism industry, which the Arad Municipality plans to further develop in the coming year. The city has 1,000 beds in hotels, hostels, guest houses and resort units and serves as a gateway to the spectacular desert landscape surrounding the Dead Sea, Masada and Tel Arad.
Finance Minister Yair Lapid recently announced that Osem will be opening an ice cream factory in Arad following the closure of Arad Towels, with the company planning to employ 250 workers.
“In the middle of the desert, you have this beautiful green city with a lot of life – we just need jobs,” says Ashkenazi, a resident of Arad for 45 years.
Rivka, 36, and David Abramov, 41, immigrated from the Caucasus region 20 years ago. The couple worked at Arad Towels and have been living in Arad for nearly two decades.
“As soon as we moved to Israel, my husband began working at Arad Textiles. It was considered a great place to work,” says Rivka.
She joined her husband three years later as a lab tester. She inspected the quality of the towels, while her husband worked on the machines.
“It was very good to work in the factory. There were other couples working there, and we enjoyed the warm environment. Over time there were layoffs, but we didn’t imagine that it could happen to us. For now we don’t have any concrete plans, but if we don’t find work, we will have to leave Arad. It will be hard on the kids,” Rivka says.
“We would like to stay,” adds her husband.
The Abramovs have three children – one son serving in the army and 13-year-old twins.
Even for Arad residents who didn’t work in the Arad Towels factory, the closure has hit hard. Although they weren’t personally aren’t affected by the factory layoffs, it still hurts them and the community as a whole, say Itzik Gamliel, who owns a welding business, and his wife, Yaffa, a teacher.
“We all feel the pain here of those laid off. This factory was more than just a symbol for our desert city,” says Itzik. “It sustained families and provided much-needed jobs. We can only hope there will be future alternatives.”


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