The Fashion Sector and Covid-19: Scenario, impacts and prospects

The third instalment of the sectoral analyses, conducted by EY and the Luiss Business School as part of the “Italian economy from crisis to reconstruction” project, looks beyond the current phase and suggests some ideas to put the country on a more sustainable growth curve.

With a turnover of more than 80 billion euros and almost 500,000 employees, the fashion supply chain represents 8.5% of the turnover and 12.5% of the employment in Italy's manufacturing industry. The national entrepreneurial fabric is characterised by medium-small companies that are strongly interconnected. This characteristic enables a high capacity for innovation, greater flexibility and a significant degree of specialisation, ensuring strong competitiveness across the supply chain:

  • the Italian subcontracting system supplies 60% of the world's quality fashion;
  • Italy's textile industry accounts for 77.8% of total European exports.


The clothing and accessories sector is among the most exposed to the effects of the Covid-19 crisis, second only to the hospitality and tourism sector. The production of textiles, clothing, leather and accessories fell by 81% year-on-year in April. The almost total closure of commercial channels, excluding online, resulted in a decrease in clothing and leather goods retail sales in April of over 83% compared to the same month in the previous year. Overall, it is estimated that, during 2020, the Covid-19 crisis will result in a reduction in turnover in the order of 26.9% in a base scenario and 34.8% in a severe scenario.

What can be done? Where to begin? The Italian clothing and accessories industry is built on a solid base of historical and successful experience. To recover lost ground and return to recording the positive trends of recent years, the sector needs an articulated restart plan, which includes setting policies to create long-term value and innovation in business models. That's why the main action areas with cover topics such as:

  • incentives for the restart and strengthening the national ecosystem;
  • the role of partnerships for innovation in the sector;
  • new business models and Made in Italy with a sustainable perspective;
  • digital fashion and new consumer behaviours.
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