Globalization and its impact on the employment prospects and wages of domestic workers have been a mayor source of concern in many industrialized countries. In this paper, we use a quasi-experimental design by exploiting a large import shock caused by the final two stages of the phasing-out of the WTO Agreement on Textiles and Clothing (ATC) that hit the German clothing industry after 2002. Using a non-affected but similar industry, the shoe industry, as a control group, we study labor market adjustments on both the firm and the individual level.