While demand for apparel in emerging markets, such as China, continued to grow during this period, it did little to buffer the industry from the effects of the global recession. As a result, revenue dropped 13.8% in 2009 and has declined at an annualized rate of 0.2% over the five years to 2013. IBISWorld estimates that industry revenue will total $577.5 billion by the end of the year.
According to IBISWorld Industry Analyst Brandon Ruiz, “Revenue has grown since then, as demand from key markets has inched back up.” The United States is the single largest market for the Global Apparel Manufacturing industry, accounting for 16.7% of revenue in 2013. US GDP, 70.0% of which is consumer spending, is anticipated to grow 1.6% in 2013 and 2.6% in 2014. IBISWorld anticipates that this will support industry revenue growth of 1.8% and 4.7% in the two respective years.
International trade is a key characteristic of this industry. For example, imports are expected to account for 76.2% of domestic demand and exports are expected to account for 75.4% of industry revenue in 2013. Industry participants are continuously shifting manufacturing operations to low-wage countries or sourcing their products from independent contractors to minimize costs. China is the world's primary source of apparel; the country accounts for 38.0% of total industry exports.
“However, wages in China are rising, and despite its well-established manufacturing infrastructure, industry operators are slowly moving production activities out of the country,” says Ruiz. Other emerging countries, including India and Bangladesh, are growing their presence as key manufacturing regions.
Rebounding global economies will bring good news to the Global Apparel Manufacturing industry over the five years to 2018. Rising per capita disposable incomes, coupled with the steady upward trend in population, will give way to greater demand for apparel. Industry revenue is projected to grow over the five-year period.
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