The Return of Growth. Sort of.
When I was a kid (a long time ago, in a country far, far away), I was taught that over-population was inevitable. There was some vague hope that technology would somehow mitigate the effects of a world stuffed with too many people. Still, back then, little attention was paid to the environmental costs of having so many people on the planet. If anything, worse-case scenarios predicted that humanity would be forever fighting wars over resources.
It was a bleak outlook. And the population of the planet did indeed explode — particularly after the Second World War — but it did correspond with a dirtier environment brought about by greater industrialization. A classic example of cause and effect.
Indeed, after a period of slow economic growth in the 1970s, when economies worldwide suffered from high inflation and nagging unemployment, politicians looked for ways of boosting national economic prospects. So, around 1980 or so, free trade and open markets took center stage. "Growth" was the word of the day. Talk of over-population was kicked to the curb, and, in many ways, so was environmentalism.
Growth at any cost
Bar the doors and batten down the hatches, common wisdom was that economic growth, at almost any cost, was the only way for national and, by inference, the global economy, could crawl out of its doldrums. And concurrently, global economic growth would help the poorest of countries where previous hand-out programs devised in the developed world to assist the developing world had failed.
Consequently, more and more peopled saw global economic growth as a viable vehicle to strengthen the developed world and help so many poor countries lift themselves out of poverty. After all, this was the time of the Cold War. The threat of Communism was always on the minds of leaders in Western capitals. So any initiative that helped to keep developing countries out of the Soviet sphere of influence was seen as a good thing, politically, too (wink-wink).
Fast forward to the 1990s. Barriers to global trade fell almost everywhere. Indeed, free trade agreements were seemingly negotiated every month. The World Trade Organization was founded in 1995 to help coordinate all of this expanded trade. Free trade encouraged more investment which in turn resulted in more economic activity. It all added up to an industrial revolution on steroids gliding along on container ships: globalization.
Everyone got in on the act, a paradigm shift in how business was conducted. And our industry was at the forefront of that change, with the result that cottage industries in under-developed countries were transformed overnight into cut-and-sew juggernauts. Add in China, and then everything changed for our industry. Many thought it would last forever.
Then we hit the pandemic. A slow-motion car wreck. The economic system that had evolved since the 1980s came to a halt. Demand dried up as economies struggled under lockdowns. Free trade ended up trapping the very practitioners of that system.
Customers stopped buying much of the stuff they used to, and their attitudes towards buying stuff changed. Online purchasing became more significant, while in-store buying waned. Supplier-buyer contracts were scrapped, and supply chains proved more brittle than resilient.
Many companies went out of business. And those who stayed in business did so at the cost of laying off many of their workers.
This brings me back to population growth. I've talked a lot about economic growth, but what I was taught in elementary school about population growth and the environment was factual until the past few years. That's when some of the significant trends brought about by globalization began to affect population growth -- but in ways that demographers could not have envisioned all those decades ago.
Population growth is declining. Imagine that. The population explosion turned out the be a dud. Fertility rates are falling. But why? Ironically, I think it has something to do with all of that economic growth, particularly over the past 30 years or so. I also think it's somehow related to the limits of our planet's ecosystem -- and human behavior.
For many countries, population growth has slowed. This is because families are smaller, and because people live longer, the population is older. But because families are smaller, there are fewer young people to support an aging population. It's a bit of a Malthusian trap. Social safety nets built for elderly retirees are increasingly supported by a smaller population of young wage-earners.
The rise of globalization resulted in two significant consequences: more people moved to cities and, second, more people had more stuff — resulting in greater expectations. A taste of the good life, if even fleeting, raises expectations of people toward their job, countries, and political leaders. They expect more these days.
It has also resulted in an altered political landscape. The Cold War may be gone, but there's a rise in authoritarianism and reactionary politics. But more importantly, it has caused a reassessment by so many people about what's truly important in their lives.
We're at a period of odd contradictions: more people live in cities, make more money, but aren't as enamored with the consumer society as they once were. Attitudes have changed. At least with many young people.
Perhaps it's a generational thing. Millennials, for instance, have lived through terrorist attacks, wars, a global economic collapse, falling wages, high debt, weakened societal norms, and, now, a pandemic. So in some ways, they've gotten a raw deal -- at least when compared to their Baby Boomer parents. And it was the Boomer generation that benefited from a consumer society that prospered during a period of relative calm from about 1980 until 2008 when the global financial collapse occurred.
An apparel industry trapped in a changing world
What does this mean for our industry? First, our industry is notoriously short-term. After all, fashion cycles move with incredible speed. But after the pandemic, how has that changed? The jury is still out on that one, though some short- and long-term trends provide a modicum of guidance as we look toward the future.
The global economy will come back to life for the short-term, even if it's in fits and starts. Pent-up demand, government stimulus payments, loose monetary policies, and more will contribute to a positive short-term outlook. Apparel sales will rebound, but this will come with the cost of higher inflation. We've seen that already in higher costs for raw materials. We may also see it in higher wages. Consumers will see it with higher prices for most goods, from food to clothing.
The big question is if this inflation is temporary or a return to the high inflation of the 1970s? The honest answer is that it's too soon to know. All we do know is that supply chains are straining under the weight of soaring demand. Economic equilibrium is out of whack; it may be temporary, but it may stay out of kilter for a while yet.
What about the long term?
Then there are the long-term trends. Changes were afoot before the pandemic messed with the world. Sourcing was changing, raw material costs were already rising in some places, consumer attitudes were in flux, and population demographics were skewed. So besides killing nearly four million people globally and sickening many millions more, the pandemic magnified preexisting trends while also impacting new consumer trends.
And then we are left with the really long term. Let's consider a possible world towards the end of the century. If population trends continue, and fertility rates in major countries continue to fall, are we really looking at a less populated world? Seems so. China, for example, may have a far smaller population by the end of the century than it does today. I know it sounds crazy, but that's what some demographers say. And they also say that recent government pronouncements of a new "three-child" policy won't affect a steep decline in the country’s population by 2100. But they're not alone. Europe, the U.S., Japan, and many other countries are also facing significant population declines.
But if there are potentially fewer people in the world, will that guarantee a better environment? A healthier Earth? Not necessarily. A lot of environmental damage can happen between now and, say, the end of the century. Even so, if there are fewer people, will fewer clothes be sold? Will our industry gradually shrink? And will landfills be filled with less stuff?
These are tough questions to answer. And the answers are not simple. One thing is sure, though: we live in a complicated world that's only going to become more complex. Opinions will abound, but answers will remain elusive. For our industry, such questions only underscore the dilemma of our times. Once the pandemic moves on, how will our industry meet the challenge posed by new consumer attitudes, changing economics, and demographics?
Originally published in just-style.com on June 17, 2021.