After a hiring surge in 2021 and into 2022, many major industries, including fashion, are now facing huge waves of layoffs. Elsewhere, we look at luxury elasticity, Gucci’s rabbit felt products and Pacsun’s leadership move. Don’t forget to subscribe to the Glossy Podcast for interviews with fashion industry leaders and Week in Review episodes, and to the Glossy Beauty Podcast for interviews from the beauty industry. –Danny Parisi, sr. fashion reporter
The layoffs are rocking multiple industries, including fashion
More layoffs swept the fashion industry last week, from Saks.com to Gymshark. Gymshark was one of the darlings of the activewear boom that was lauded for its rapid rise to unicorn status. The British company is now laying off 65 people in the US as part of a restructuring of its US business.
Outside of fashion, layoffs have been rampant in the tech, finance and media industries – Alphabet, Microsoft, Vox Media, the Washington Post and Goldman Sachs have all been affected. It’s the latest rollercoaster ride in the pandemic-era labor market. Millions of jobs were lost in 2020, only to be regained in employment growth in 2021 and early 2022. Now, the pendulum is swinging once again, and millions of Americans are finding themselves out of work. Even if other fashion companies do not experience layoffs, the depressing force of job losses in the consumer market is sure to have an impact on industry forecasts for the year.
Luxury stays strong
Despite the uncertainty of layoffs, LVMH owner Bernard Arnault said he is confident about the megacompany’s prospects for 2023. In an earnings call Thursday, the company reported that sales at its fashion and leather goods division, which includes Louis Vuitton, increased by 20% compared to the previous year.
Luxury tends to be insulated from economic situations like the one we’re in right now. The people who lose their jobs are mostly not consumers of ultra-expensive products like those offered by LVMH brands. The company’s management worked to remind shareholders of this fact in its earnings calls. LVMH CFO Jean Jacques Guiony said: “Last year’s strong results, despite the war in Ukraine and challenges in China, show the resilience and resilience of luxury consumers and the strength of our brands.”
Gucci pulls rabbit felt products
Gucci got a little overzealous in celebration of the Lunar Year of the Rabbit, which began on January 22nd, by selling a product made from 100% rabbit fur. Activists pointed out that this broke with Gucci’s 100% fur-free commitment. According to the brand, the scarf doesn’t count as fur, as it doesn’t come with animal skin attached. However, its brand withdrew the products from its catalog.
Pacsun changes its leaders
Brie Olson, longtime president of the Pacsun brand, moved into the role of co-CEO alongside Mike Relich. Current Relich co-CEO Alfred Chang, who has held the role for 17 years, is leaving to become CEO of Fear of God, a regular partner of Pacsun.
Neale Attenborough, managing director at Pacsun owner Golden Gate Capital, said Olson has been “instrumental” to Pacsun’s success over the past few years.
“Brie’s strong relationships with other Pacsun designers and partners, combined with her keen sense of style, will continue to be strong assets to the company as she steps into her new leadership role alongside Mike,” he said in a statement.