Weekend Briefing: Layoffs across multiple industries bode poorly for … – Glossy
After a hiring surge in 2021 and into 2022, multiple major industries, including fashion, are now facing huge waves of layoffs. Elsewhere, we look at luxury resilience, Gucci’s rabbit felt products and movement in Pacsun’s leadership. Don’t forget to subscribe to the Glossy Podcast for interviews with fashion industry leaders and Week in Review episodes, and the Glossy Beauty Podcast for interviews from the beauty industry. –Danny Parisi, sr. fashion reporter
Layoffs shake multiple industries, including fashion
More layoffs rippled across 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 growth to unicorn status. The British company is now laying off 65 people in the U.S. as part of a restructuring of its American business.
Outside of fashion, layoffs have been rampant across the tech, finance and media industries — Alphabet, Microsoft, Vox Media, Washington Post and Goldman Sachs are all affected. It’s the latest dip in the roller coaster of the labor market in the pandemic era. Millions of jobs were lost in 2020, only to be regained in the hiring surges of 2021 and early 2022. Now, the pendulum is swinging once more and millions of Americans are finding themselves without a job. Even if other fashion companies don’t experience layoffs, the depressing power of lost jobs on the consumer market will surely leave an impact on the industry’s forecasts for the year.
Luxury stays strong
Despite the uncertainty of layoffs, LVMH owner Bernard Arnault said he’s confident about the mega company’s prospects for 2023. In an earnings call on Thursday, the company reported that sales in its fashion and leather goods division, which includes Louis Vuitton, were up by 20% compared to the previous year.
Luxury tends to be insulated from economic situations like the one we’re in now. The people losing their jobs mostly aren’t the consumers of ultra-expensive products like the ones offered by LVMH’s brands. The company’s leadership 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 permanence of luxury consumers and the strength of our brands.”
Gucci pulls rabbit felt products
Gucci got a little too over zealous in celebrating the lunar year of the rabbit, which began on January 22, by selling a product made with 100% rabbit felt. Activists pointed out that this jarred with Gucci’s 100% fur-free commitment. According to the brand, felt doesn’t quite count as fur, since it doesn’t come with the animal’s skin attached. Even so, it brand pulled the products from its catalog.
Pacsun shuffles its executives
Brie Olson, longtime brand president of Pacsun, was moved to the role of co-CEO alongside Mike Relich. Relich’s current 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, a managing director at Pacsun’s owner, Golden Gate Capital, said Olson has been “instrumental” to Pacsun’s success over the last few years.
“Brie’s strong relationships with designers and other Pacsun partners, combined with her keen sense of style, will continue to be strong assets for the company as she steps into her new leadership role alongside Mike,” he said in a statement.
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