New York's fashion industry finds itself in a critical juncture, according to a new report.
New York City's Fashion Industry Faces Challenges, Report Warns
A new report from the Partnership for New York City has raised concerns about the future of New York's fashion industry, suggesting that it could lose its prominence to Paris and Milan. The report, which was compiled with research by McKinsey & Co. and other data, highlights several factors contributing to the industry's decline.
The report reveals that the industry's contribution to the city's gross city product (GCP) started to decline in 2014, dropping sharply between 2019 and 2020. Between 2012 and 2022, the industry's GCP dropped 13.6% and has yet to fully recover.
One of the key reasons for this decline is the rise of direct-to-consumer (DTC) brands and the closure of specialty stores in New York City, such as Henri Bendel, Barneys, and Opening Ceremony. These changes have impacted the fashion industry significantly.
Another concerning trend is the decrease in the completion of fashion degree and certificate programs. From 2016 to 2022, the number of students completing programs at New York's main fashion schools, including Parsons School of Design, the Pratt Institute, and the Fashion Institute for Technology, has decreased by 30%.
The report also notes that top designers and fashion companies are less visibly engaged in New York and its institutions. This lack of visibility is a cause for concern, as it could signal a shift in the industry's focus away from New York.
The authors of the report believe that New York City's position in fashion is threatened by factors such as higher operational costs, declining manufacturing infrastructure, and the lure of stronger global fashion capitals that offer more competitive advantages.
To maintain and strengthen New York City's fashion industry, the report recommends investing in fashion manufacturing, supporting local designers, enhancing infrastructure, and fostering innovation and collaboration. The report also suggests forming deeper connections between the industry and schools, increasing promotion of New York Fashion Week, and creating a "Central Designer Campus" for new and emerging designers.
The Partnership for New York City, a nonprofit organization, has members that include business leaders and employers from corporate, investment, and entrepreneurial firms, as well as fashion industry partners like LVMH, Macy's, Tapestry, and the Esteé Lauder Companies.
Despite the challenges, the report notes that New York remains a popular destination for flagship retail, and e-commerce's escalation during the pandemic has not diminished its appeal. However, the transformation of New York Fashion Week has led to its perceived diminished status, due to changes in the media and influencing landscape, logistical challenges, movement of some American fashion superstars out of New York City, and the increasing cost of doing business.
One positive development is the passing of the Fashion Workers Act by the New York state assembly in an attempt to correct a 'gross power imbalance' in the industry. This act could help to address some of the issues faced by the fashion industry and support its recovery.
Emerging designers still rely on the infrastructure of a local manufacturing ecosystem for collaboration, rapid iteration, and production. Social media and e-commerce create a "decentralization of influence," where tastemakers and trendsetters could be from anywhere. However, the report emphasizes the importance of maintaining a strong local fashion industry to support these emerging designers and foster innovation.
In conclusion, the report serves as a call to action for the fashion industry and policymakers to address the challenges facing New York's fashion industry and work together to maintain and strengthen its position as a global fashion capital.
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