Britain’s surprisingly hidden boom in apparel exports

When it comes to apparel-making in Britain, there’s one thing we all think we know: there isn’t very much of it. But Britain’s official trade statistics seem to tell a very different story. 

In the 19th century, Britain’s textile industry led the world. But by the end of the 20th century the country had become almost entirely dependent on imported apparel.

By 2000, its total apparel exports were way behind those of Italy or France. But something very strange appears to have happened since then.

Apparel exports are soaring

Britain’s official trade data shows the country’s apparel exports, measured in US dollars, more than doubled from 2000 to 2015: rising from $3.6bn to $7.9bn. 92% of those exports went to the EU: almost the same as all Britain’s worldwide exports of alcoholic and non-alcoholic drinks – including beer, gin and whisky – put together.

Some of that growth was due to the collapse of the US dollar against European currencies – but Italy’s exports rose just 59% over the same period. Measuring exports by weight alone, and the difference is more striking: Britain exported 163,000 tonnes of apparel in 2000, but more than three times as much (550,000 tonnes) in 2015. Britain’s tonnage of exports was half that of Italy in 2000, but soared to over twice as high by 2015 – and, indeed, twice that of America.

In 2016, clothes exports from Britain, as from most of the rest of Europe, slipped back a bit. But however you look at the export numbers, they’re well up on where they were 10 or 20 years ago.

Are they really?

Now there are three possible explanations for this:

• Britain’s making more clothes.
  That would be nice – but, sadly, unlikely. Official data shows recent growth in some textile production; but none in clothing
• There has been huge growth in clothes coming through Britain for onward sales abroad.
  In my view this is the likeliest explanation. Whether it’s Amazon’s growing use of Britain as a hub for its European garment sales, Boden’s growing dependence on non-UK sales, usually through its website, or Sports Direct’s growing foreign sales from its notorious Shirebrook hub, there’s been huge growth over the past decade or so in British retailers’ web sales. Very often, Britain’s conventional apparel retailers – like M&S, Primark or Arcadia – still ship garments from Asia into a UK hub before onward despatch elsewhere, although most continue to push for direct delivery from manufacturing country to the country where shoppers will be buying.
• There’s a Customs racket going on. The EU’s anti-fraud branch, Olaf, is convinced there’s a history of deliberate value under-declaration in Britain’s ports, and that Britain’s Customs authorities aren’t doing enough to stamp it out. They see evidence for this in the faster growth in the weight of clothes exported than in their declared value: and they cite some examples of Chinese women’s trousers valued at EUR0.91 per kg – when raw cotton was selling at EUR1.44 per kg.

Olaf claims clothes and shoes are flooding into the UK at low valuations, attracting low import duty, and are then being re-routed to the EU’s Eastern members to be sold cheap on local markets.

Off the record, some British Customs officials are unconvinced: they suspect a protectionist mindset in many Continental Customs authorities that assumes criminality too easily.

They may have a point. There were very few trousers valued at EUR0.91/kg – a price that’s quite typical of how little a cancelled order for a major chain is often worth. In claiming that the price proves UK Customs’ negligence, Olaf may really be demonstrating just how isolated it is from the way our industry works.

But you can never rule out criminality somewhere in the system.

Whatever lies behind the export growth, however, there’s still growth – meaning more work in British docks, road freight and warehouses. This isn’t just about moving clothes from one truck to another though: all sorts of re-working and modifying happens in Britain too – and the business generates huge demand for designers, merchandisers and webmasters.

Why does this matter?

The Trump and Brexit convulsions, and the upsurges of nationalism elsewhere, have moved public debate in many countries about where things are made.

• For much of the past 15 years, many of us pointed out the benefits of manufacturing in low-cost countries – to Western shoppers and to poor-country workers alike;
• Over the past year, attention has switched to the downside of offshoring. And it’s right that our industry acknowledges there are problems with making most clothes abroad.
• But the issue isn’t as simple as ‘Onshore good: offshore bad.’ In Britain, a hidden consequence of sourcing overseas has been a boom in clothing exports, especially to other EU countries.

Most of our trade is preoccupied with whether Brexit will make it more difficult to continue importing clothes, and its impact on access to labour.

For many, though, there is the likelihood that Brexit will make it harder to export too. Britain’s Customs authorities now admit they can’t be certain they’ll upgrade their computer systems in time to cope with the growth in inspections by the time Britain leaves the EU. Even worse is the fact almost all those exports go to Europe by truck – and there’s no indication how long it will take French and Belgian Customs to improve their systems for receiving UK imports.

But Brexit isn’t the only issue

It is essential that Europe’s apparel industry pressurises governments for a Brexit solution implemented to improve European trade, not destroy it. With or without Brexit, Britain’s extraordinary re-emergence as a clothing exporter demonstrates how today’s globally integrated world creates new career opportunities that simply don’t get mentioned in all the brouhaha about Brexit, Trumpery, Marine Le Pen and all the rest of it.

As just-style’s British readers go off to vote in the election on 8 June, I’ve one piece of advice for them on behalf of us all. Ask your candidates what they’re doing to help Britain’s clothing industry.