Latest since the publication of “A New Textile Economy: Redesigning Fashion’s Future” by the Ellen MacArthur Foundation (EMF) in 2017 which proclaimed that “in the last 15 years [between 2000 and 2015], clothing production has approximately doubled”, everybody believes fashion production and consumption growth is completely unhinged and on track to wreck our planet.
The below chart was used to visualise the calamity and has since been reproduced in countless presentations, videos, advocacy pamphlets and even scientific papers. As a result of it, we have rushed into all sorts policies and industrial strategies to try to bend this unsustainable upward curve, through circular economy concepts, extended producer responsibility schemes or even publicly funded PR campaigns such as the EU’s “Make fast fashion out of fashion”.
But what if we took a more sober and nuanced look at what was going on from 2000-2015, what has happened since and what is likely to happen going forward?
To start with, why is global fashion consumption growing? EMF in 2017 delivered two reasons. The report states that the observed growth was “driven by a growing middle-class population across the globe and increased per capita sales in mature economies. The latter rise is mainly due to the ‘fast fashion’ phenomenon, with quicker turnaround of new styles, increased number of collections offered per year, and – often – lower prices.”
The problem with this explanation is two-fold. First, it forgets one important third driver. Between 2000 and 2015 the world population grew by 21% from 6.15 billion to 7.43 billion, so just to keep per capita consumption steady, clothing consumption would have to grow by that 21% too. And secondly, it doesn’t attempt to quantify the weight of the two drivers it did identify. Does the growth of the middle class around the globe contribute 80% to consumption growth and the rise of fast fashion 20% or vice-versa?
When reading the rest of the report it becomes very clear that the authors see the main culprit in the fast fashion phenomenon in Western markets. You can attribute this to either home bias/cultural myopia (EMF is UK-based) or agenda (Ellen MacArthur was one of the figureheads of the EU circular economy policies emerging around 2015 and needed good stories). It also seems easier to attack overconsumption in the West, than to campaign against growing prosperity in developing and emerging economies. Let’s see if we can tease out the facts.
When looking at clothing or fashion consumption in Europe, it is relatively easy to find statistics expressed in € values and those tend to go up over time, but much harder to find data on consumption volume in weight or number of pieces.
One study that has done this meticulously using EU trade and production statistics was the EU JRC’s technical report “Circular economy perspectives in the EU Textile sector” from 2021. The resulting charts look like this.
Over a similar 15 years time frame as the EMF report it shows only minimal total volume growth and basically no growth in per-capita clothing consumption in the EU. With the COVID disruptions in 2020-21 and the inflationary pressures of 2022-23 it is rather unlikely that the blue bars in the chart would have moved upwards much since then. While I have not seen more recent data for the EU, I have a few days ago come across this interesting graph for the US market, courtesy to Robert Antoshak
Since there isn't a lot of apparel manufacturing in the US, imports are a pretty good proxy for consumption. When you combine the two declining graphs for China and the Western hemisphere with the 2 growing graphs for ASEAN and Southern Asia, you will find that they cancel each other out. So it seems the volume of apparel consumption in the US (the SME on the y-axis stands for square meter equivalent) was flat to down slightly over the last 10 years. And even if we contend that the finishing year 2023 was a particularly bad one for apparel consumption, nothing in these charts looks like massive growth to me, but rather like sourcing location share shifts in a rather stagnating overall market.
Since the US had faster economic growth over that time frame than Europe and has healthier demographics, we have to assume that the stagnation or decline was likely somewhat more pronounced here. So we have our answer to the real drivers for the clothing consumption growth stipulated by EMF. It was essentially global population growth and growing consumption thanks to rapidly rising incomes in emerging economies with very little contribution from volume growth in Western markets.
So why has clothing consumption in Europe barely grown over the last 20 years and what does it mean for future consumption expectations?
In my opinion clothing consumption has four major drivers (1) population growth, (2) disposable income growth, (3) shifts in consumer spending categories and (4) consumption prices. Let’s look at each of them.
To recap, none of the four major clothing consumption drivers look to be intact in Europe. I therefore fail to see where clothing consumption growth is supposed to come from. But why do most people believe that continued (or rather accelerating) growth is realistic? Here an example.
As part of the recent study on textile waste carried out by the EU JRC in 2023, consumption growth for the period of 2021 to 2035 for the EU was estimated at 3% p.a. It is stated that “The projection of import, domestic production and export (and then, apparent consumption) of textile products is estimated assuming a Compound Annual Growth Rate (CAGR) equal to 3%. This value is aligned to the Strategy for Sustainable and Circular Textiles. ... During the JRC workshop on textile waste, stakeholders confirmed that a 3% compound annual growth rate is a realistic outlook for the EU.”
Two things are notable about this statement:
1. The assumed growth value is aligned with the EU Strategy for Sustainable and Circular Textiles. Curiously it is not aligned with any growth value or estimate for EU textile consumption, because this strategy doesn’t contain any such value. Instead it recites right in the second paragraph of the introduction the claim by EMF discussed at the beginning of the article “Global textiles production almost doubled between 2000 and 2015, and the consumption of clothing and footwear is expected to increase by 63% by 2030, from 62 million tonnes now to 102 million tonnes in 2030.” So I guess it is rather aligned with the spirit (or you may say the ideology) of this EU strategy which claims that (fast) fashion consumption growth in Europe is unsustainable and needs to be reined in. In other words, it would look bad if the underlying technical study of this EU strategy, that should provide the detailed guidance for regulation, contradicts the very baseline assumption on which the policy is built. Food for thought…
2. It is true that the majority of stakeholders in the referenced JRC workshop (which I attended) did agree that clothing consumption in Europe is likely to grow. The likely reason is that most publications such as the NGO or consultant studies, policy reports or scientific papers and the media that copies from them show growing global graphs (typically of total textile fibre production), while good solid volume data for the EU market is not readily available. Also people tend to look at the growth rates of the latest poster children of the fast fashion market, not realising that they look at the shiny tip of an iceberg, which has a rapidly melting underwater mass composed of ageing, struggling and dying brands and retailers that lose market share to the new kids on the block. And a third reason is that many of us live in the past when it comes to much worldly knowledge, as the late Hans Rosling has so funnily exposed in his various lectures (like this one). Yes there was a time when clothing consumption did grow in Europe like the 1990s and early 2000s when 100+ million Eastern Europeans with relatively empty wardrobes joined the free market and later the EU and when rapid offshoring during MFA phase-out led to clothing price deflation and the rise of cheap fast fashion chains, but this was 20 years ago. The present and future look very different.
When thinking about future clothing and fashion consumption in Europe, I would imagine three distinct scenarios:
A. A slow decline scenario where the above described headwinds of poor demographics, reorientation of disposable income from products to services and ongoing price inflation of fashion products due to input cost increases and growing compliance costs and environmental taxes conspire to lead to a compound annual 1-2% per capita volume decline over the next 10 years.
B. A muddle through scenario where clothing consumption remains relatively stable fluctuating through economic cycles, but the industry balances cost and (relatively manageable) regulatory headwinds with production efficiency and innovation in product and greater consumer engagement and convenience, driven by online shopping and social media.
C. A reinvigorated growth scenario where a combination of product and technology innovation, new engaging business models, an unexpected demographic uptick (perhaps through greater immigration to provide much needed workforce for an aging Europe) and a benign regulatory environment allows the fashion market to realise modest volume growth of 1-2%.
From today’s vantage point, I would give scenario A a 40% probability, scenario B 50% and scenario C not more than a 10% likelihood.
On the basis of such assumptions, many regulatory initiatives and industry investments should be reevaluated, because basing your solutions on a faulty understanding of reality or the problem at hand rarely leads to good outcomes. A lot of fashion (retail) business models are based on volume growth, often simply opening the same stores in additional locations. Many started to run into trouble over the last 10 years, and these trends are accelerating to the detriment of our inner city high streets and out-of-town shopping centres. The online and social media shopping boost post-COVID also seemed short-lived. With interest rates in much more normal territory, many low-cost debt-fuelled industry and retail investments, don’t make sense anymore. It is time for the industry to truly invest in product and service innovations that generate more economic value from less product volume.
Those investing in textile waste collection, sorting and recycling infrastructure should not build their business cases on ever-growing post-consumer waste volumes. And policy makers need to balance the environmental benefits of a shrunken fashion industry with the economic impacts of dwindling employment in fashion design, textile and garment manufacturing (in Europe and in developing countries) and the rapid disappearance of fashion shops from Europe’s shopping streets.
