Australian fashion employs more than mining, export revenue exceeds beer and wine, report finds

It employs more Australians than mining, it generates more export revenue than wine and beer, and it has the highest percentage of female workers, yet too often fashion is overlooked in the broader economic story.

That’s the finding of a new joint report from EY and the Australian Fashion Council, which called for stronger support from the federal government to plug the skills gap and bolster female economic security.

CEO of the Australian Fashion Council (AFC) Leila Naja Hibri says the fashion and textile industry is languishing through the labour shortage plaguing the country’s workforce, in fact the OECD found we’re living through the second-worst staffing crisis in the developed world (behind Canada).

“As one of the very few manufacturing industries powered by women, we need funding to identify critical skills shortages and opportunities; areas for upskilling and reskilling; scope for apprenticeships, traineeships and ongoing education; and career pathways that create future job security,” Naja Hibri said.

The report found the burgeoning industry has huge potential: in the short term, fashion and textile can generate $1.3 billion, and over the next 10 years become a $38 billion industry, creating 86,000 new jobs along the way.

And bolstering the industry would be significant for female workers, who make up 77% of fashion’s workforce yet accumulate on average less superannuation over their lifetime than their male counterparts. They also make 86.2 cents on the dollar compared to male colleagues, and make up the fastest-growing group into homelessness (women over 55 years of age).

In dollar terms, there is a difference of $255 per week in the full-time earnings of men and women in Australia, according to the federal government’s Workplace Gender Equality Agency.

Investment in women-dominated industries pays, the report found: businesses with 30% or more women in leadership are 15% more profitable, and the Australian economy would gain $8 billion if the transition rate from tertiary education to the workforce was equal for men and women.

There are four main areas of investment the AFC is campaigning for: among them, the promotion of the Australian Fashion certified trademark campaign locally and globally to turbo-charge local and export earnings, and making fibre and its derivatives (textiles, uniforms and clothing) a priority in the building of Australia’s sovereign capabilities.

In addition, a boost to women’s economic security by developing career pathways for women throughout their working life, addressing current and future industry skills gaps and opportunities, and the creation of a workable and sustainable circular economy across Australia’s clothing, uniforms and textiles supply chain.

In May last year, the AFC was awarded a grant by the federal government to create a certified trademark, and the council launched it at this year’s Afterpay Australia Fashion Week.

For brands to become certified, they must tick two of the following: demonstrates a contribution to jobs and the local economy, is Australian made, is Australian owned, has a majority Australian employees, and/or is Australian tax domiciled.

Naja Hibri says she hopes the trademark will see Australian fashion to embody distinctive associations, in the way Italian fashion is known for its elegance and quality.

“We have now identified four key pillars that distinguish Australia’s fashion DNA: effortless style, raw nature, boundless optimism and fearless innovation,” she said.

Brand growth stifled by labour shortage

One such recipient of the trademark is State of Escape, a women’s accessories brand that has diversified into Japan, the US, South America and the UK while staying true to its Australian provenance and slow fashion ethos.

All products on the State of Escape line are manufactured by a Sydney factory that had 20-25 staff before the pandemic, but is now down to 15 staff amid skilled labour shortages.

The challenge now for the Australian brand is to match the headcount growth (from 10 to 15 in 2022) and the sales growth projection in the next five years (150-200%) with the output of the factory.

“The key needs are greater skills training and education of staff, access to funds for innovation in machinery and new manufacturing processes and developments,” said co-founder and CEO State of Escape Desley Maidment.

“This is where government support to local manufacturing to modernise and build a skilled labour force would make a significant difference.”