With influence factors such as the pressures of Brexit and the COVID-19 pandemic, the UK fashion and textile industry is experiencing what experts are calling "the perfect storm” - a combination of economic recession, skilled labour shortages, and shifting market dynamics.
Despite these challenges, the UK fashion and textile industry continues to hold certain competitive advantages particularly in the luxury segment.
Economic Pressures: The Recession's Impact
The fashion and textile industry is currently challenged by the simultaneous effects of microeconomic, geopolitical, and climate-related pressures, all worsened further by a looming recession. Ian Stewart, Deloitte's chief UK economist, highlights that manufacturers are facing "a combination of very high inflation, which means their own costs are rising sharply" (Drapers, 2023).
As the recession deepens, over 50% of fashion executives are considering raising prices, which is a necessary strategy for survival, yet one that risks alienating consumers. For manufacturers, this scenario involves not only escalating operational costs due to inflation but also higher import expenses linked to the weakening pound.
Addressing the Skills Shortage: An Ever-Growing Crisis
The UK textile and fashion industry has been impacted by the decline in UK-based workers and a major shift in education towards STEM subjects, resulting in the shortage of skilled labour. Essential skills like basic sewing are no longer passed down from generations or taught in schools, yet they are crucial for the growth of the sector.
Kerry Senior, director of Leather UK, blamed the skills shortage on the post-Brexit points-based immigration system. This system requires non-UK workers to meet specific criteria, such as a minimum salary threshold of £38,700, english language proficiency, or employment in a “shortage occupation”. Unfortunately, the fashion and textile sector does not appear among the list and is not classified as a “skilled” profession, which intensifies the issue.
However, the skills shortage has been a long-term issue in the industry, with few of the biggest concerns being training and retaining talent. Kate Hills, manufacturing expert and founder of Make it British, notes that while Innovate UK provides funding, it “rarely benefits the textile and garment manufacturers who need it most”, and does little to address the skills gap or attract young people to the industry. Addressing this challenge requires urgent structural changes and educational initiatives at school level to capture new talent into the sector.
The Future of UK Fashion and Textile Manufacturing: Call for Re-Shoring
According to the UKFT (2024), the UK fashion and textile industry supports a £62 billion contribution to UK GDP, 1.3 million jobs, and generates over £23 billion in tax revenues. These figures are expected to have a drastic increase, highlighting the industry’s potential of expanding its socioeconomic footprint. However, achieving this will require overcoming international trade barriers, expanding the investment in skills training, and addressing circular economy practices.
Three reasons why Brands should consider Re-shoring Manufacturing in the UK:
Transparency and Ethical Production: Manufacturing in the UK produces 47% fewer emissions compared to similar operations overseas. Additionally, the long-distance transportation of goods, a major contributor to greenhouse gas emissions, can be significantly reduced.
Higher Quality: The UK has a long-standing tradition of excellence in textile manufacturing. By choosing to manufacture in the UK, brands are opting for companies that ensure fair wages and safe working conditions. Additionally products are usually crafted from high-quality materials and produced in smaller, more controlled batches.
Addressing the skills shortage through training programmes: The re-shoring of textile production to the UK, not only creates new job opportunities, but also addresses the industry's skills shortage through training and development.
Where is LLUK positioned in this economy?
As a UK-based manufacturer we are graded ‘excellent’ across all ethical and quality auditing and work to these standards as a bare minimum, not out of obligation, but because we believe it’s the right thing to do.
Transparency is at the core of how we operate and we are proud to share all of the internal workings of LLUK with our clients and only work with businesses who value purpose and transparency.
See what our CEO, Rachel Walker has to say:
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