CPSIA Update: Crash, Shatter, Tinkle Go the Jobs

By July 20, 2009Regulations

As we await the Consumer Product Safety Commission’s release of guidance that industry must follow in attaching permanent tracking labels to all children’s products, we offer this update on the economic damage already wrought by the Consumer Product Safety Improvement Act (CPSIA).

This summary below comes from CPSC Commissioner Nancy Nord in her statement issued in conjuction with the CPSC’s denial Friday of the petition from the fashion jewelry industry and others to exempt crystals and beads from the CPSIA’s lead-content standards. The commission posted its decision late Friday, and there has been no news coverage we’ve seen on the determination.

Too bad. As Commissioner Nord notes:

If we adopt the staff recommendation, there will be significant and severe economic injury to those who make and sell these products. Although the total impact has not been computed, we have been given enough anecdotal evidence to know that the economic loss will be severe. Here is a sample of what we have heard:

  • A major retail chain attributed a $6.5 million loss in the first quarter to the lack of an exclusion for crystals; $200,000 of jewelry that complies with Proposition 65 in California nevertheless was pulled by another manufacturer;
  • About 2 million jewelry pieces from a different manufacturer are being returned, the loss estimated to reach millions of dollars;
  • A retailer reported $700,000 in testing costs for crystals;
  • Substantial drop in sales reported by companies who have substituted plastic for crystal products, and
  • Examples of job losses: a small children’s jewelry manufacturer with 50 employees anticipates closing down because of this law; several companies are preparing to reduce their workforce by 1/3 because of the CPSIA.

Seems newsworthy.

Much more, including dependable and discouraging analysis from Rick Woldenberg, “CPSIA – Fashion Jewelry Loses a BIG One.”

UPDATE And here’s the CPSIA’s vote, just arrived via e-mail.

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