The British Fashion Council (BFC) is issuing a stark warning and urging the UK government to provide urgent assistance to the struggling fashion and retail sectors. Recent data from Oxford Economics has painted a grim picture, indicating that the global pandemic could have a devastating impact on the British fashion industry. The BFC cautions that the sector may be hit twice as hard as the UK economy as a whole, potentially unraveling the progress it has made over the last decade.
According to the report, the fashion industry supported 890,000 jobs in Britain last year, but now faces the possibility of up to 240,000 direct job losses. When considering indirect employment throughout the supply chain and consumer spending, this figure balloons to 350,000, which equates to 1% of all jobs in the UK. Moreover, the industry’s contribution to the UK’s GDP is projected to decrease significantly, dropping from £35 billion to just £26.2 billion in 2020. Revenues are also expected to plummet from £118 billion to £88 billion.
These alarming forecasts coincide with warnings from the New West End Company about potential job losses in the UK’s premier shopping district. In response, the BFC is urging the government to intervene and provide vital support to struggling businesses. This could involve measures like lease re-negotiations for landlords who are not acting responsibly, as well as grants or interest-free loans to help alleviate lease costs, and relief on rent and rates for all impacted businesses.
Furthermore, the BFC is advocating for additional assistance for small and medium-sized enterprises (SMEs) that were viable before the pandemic but may not qualify for other relief programs. They are also calling on larger retailers to support smaller businesses by maintaining orders and offering sell-through guarantees on agreed-upon purchases. The BFC is also pushing for the creation of a supportive ecosystem for smarter manufacturing, waste management, recycling, upcycling, and business models to establish a leading British circular fashion economy.
Additionally, the BFC is requesting the exploration of financial tools to de-risk businesses in the future, like supply chain finance, and a moratorium on the payment of duties and tariffs to aid in the restart of international supply chains. The fashion industry is navigating unprecedented challenges, and the BFC stresses the need for immediate action to safeguard jobs and ensure the sector’s sustainability in a post-pandemic landscape.
For more information on the British Fashion Council’s efforts and the impact of the pandemic on the fashion industry, please visit the BFC’s official website and the Oxford Economics resource page.
