Shifting to a circular clothing value chain in the Netherlands could boost job creation by as much as 25%, a recent Circle Economy report finds. Read on for insights from three expert panelists from our latest webinar, Putting circular textiles to work in the Netherlands, as well as answers to audience questions on the topic.
The Netherlands has set the ambitious goal of full circularity by 2050 and halved resource consumption by 2030, necessitating change that spans sectors and industries. A systemic shift in the Dutch clothing industry can deliver substantial impact and edge us closer to meeting the government's overall circular and social goals, creating new jobs and valorising and upscaling existing ones.
Currently, the Dutch clothing value chain employs around 127,024 FTEs. The bulk of these jobs (94%) are in retail and distribution. Only around 1% of jobs can be classed as core circular jobs: these crop up in the value chain in the repair, waste and resource management sectors, including textile collection and sorting.
Circle Economy and HIVA - KU Leuven have found that a scenario that prioritises clothing reuse locally presents the most impactful employment potential for the Dutch clothing value chain, creating 25% more jobs than business as usual in 2050. The bulk of the increase stems from local collection and waste sorting activities. Reuse is also bolstered due to a growing second-hand market, a consequence of second-hand stores and repair and maintenance services becoming more prevalent.
In a fully-circular textiles scenario, new jobs in the repair sector will emerge: from (re)manufacturing designers to employees that can assess the quality of second-hand garments. Resale collection managers and technical, associate and professional-level workers in technology and e-commerce will come to the fore in resale, while increased collection and sorting will see a boost in the number of textile collectors and sorters.
Below you can find a summary of key insights as well as answers to questions asked by participants during the webinar.
Further broadening and scaling of end-of-use activities, such as textile collection and sorting, is expected if the industry is to become more circular. Sorting, for example, will be essential in developing more nuance in the sector, in terms of new parameters and categories—from differentiating materials and stocks from specific brands, to sorting according to the repairability of garments. Knowledge of different material compositions, brands and their subsidiaries, and the ability to judge the re-wearability of clothing and its potential for repair, will become increasingly important.
Kris Bachus led the development of the scenario modelling of employment effects in Putting circular textiles to work, and placed emphasis on the end-of-use value chain stages with highest job creation potential. First, Kris highlighted that even though the net effects are positive for the whole clothing value chain, the Retail and Distribution stage—where the bulk of jobs are currently located—will experience job losses under a circular scenario that prioritises local reuse. However, a diversification of jobs will also occur along the end-of-use value chain stages. This will be the case for collection and sorting activities—considered underdeveloped up to now—which along with repair and reuse will boost the labour market for the circular clothing value chain.
Troy Nachtigall reflected upon the role of technology and innovation in the changing operations of end-of-use supply chain stages. In his opinion, technology allows us to look at what we can do with textiles in a very detailed manner: currently, the industry is working with materials that can’t be recycled easily, which makes it difficult to think about second-life uses for garments. Part of his current research touches upon bringing back ancestral and indigenous technologies—the case of vegetable tanned leather, for example, or the use of podiatry in the ancient Roman times—which could be considered more circular than our current production processes. Troy also sees great opportunities for people coming into the Netherlands with the proper skill sets for the clothing industry, such as sewing or tailoring. Currently, language or cultural barriers could be an obstacle to making the most out of these talented newcomers, but the use of ICT platforms or interfaces, could be the key to overcoming these types of barriers in the short run.
In an industry focused on reuse, we've observed that (Re)manufacturing Designers will be essential for creating value out of a new, increasing and ever-changing material stream of used textiles. These designers will need to be supported by a large number of skilled trade workers for (dis)assembly, repair and maintenance activities—such as tailoring or sewing. Although some of these skills are already cropping up in the Dutch labour market, their presence is limited and will require growth.
Interdisciplinary skills that enable collaboration across disciplines, departments and organisations are also essential for the transition to a circular clothing industry. Roles that act as linking pins or bridges between diverse stakeholders, for example in innovation management, will thus become increasingly important.
Makers Unite is an Amsterdam based organisation that constantly supports newcomers with skill sets in relation to the clothing industry. Thami Schweichler, in his role as Managing Director of Makers Unite, consistently reaffirms the importance of focusing on new business models, more suitable for the future circular clothing industry. An important element of these new business models relies on developing alternative means of value creation, which go beyond traditional business-to-customer (B2C) relationships. This creative process also means that the current roles and occupations within the clothing industry must evolve in order to meet the needs of the future, which implies greater knowledge diversification and improved interaction with technology.
Troy, in his role as an educator and researcher, considers how digital skills represent an opportunity to teach new designers and people within the fashion and clothing industry about inclusivity: the clothing industry should create products for all sizes and shapes of people. This goes hand in hand with creating durable products, preferably using the lifetime of the user as a benchmark. Current research in this area revolves around the use of AI techniques to help understand how different people age and wear their clothes, and the recording of data on worn out garments once they have been discarded.
When looking at managerial roles within resale and sorting, we have observed an increased need for Social Work Managers, that are properly skilled and trained to manage a diverse workforce. This role requires excellent people management skills, a good variety of social and listening skills and an understanding of the needs of different vulnerable worker groups.
Kris has conducted extensive research on resale businesses in the Belgian region of Flanders. He found some similarities between the Flemish case and the Netherlands. More than 50% of second-hand clothing circulates from consumer to consumer through informal channels—an insight that was extrapolated from the Flemish context and applied to the Dutch clothing value chain. Increasing opportunities for people distant to the labour market, mostly in collection and sorting activities, was another finding from the Flemish context applicable to the Netherlands. Under a future circular clothing value chain, these two activities in addition to increased repair and second-hand sales could provide opportunities for vulnerable workers. Kris also mentioned that governments are key players in developing more opportunities for vulnerable workers.
Finally, Thami mentioned that social inclusion is a key pillar of Makers Unite’s activities. However, he distinguished some challenges in relation to migrant worker integration, mostly in terms of skilling this workforce according to international standards of production and quality control. Those skills touch upon the use of IT technologies, digitalisation and better integration with procurement activities, for instance. Again, in his opinion, the government could help to provide training in the areas where skills gaps are identified. He believes that the clothing sector is the perfect field for newcomers because it gives them the opportunity to feel valued, recognised and integrated within a production process, a crucial factor for vulnerable workers; this could become even more relevant for newcomers that arrive from countries with difficult contexts.
To wrap up the panel discussion, we asked the experts what should be prioritised for the clothing industry to become fully circular by 2050. The panelists agree that giving special attention to providing ICT tools is paramount: this would allow faster and more efficient communication, resulting in a more cost-efficient and competitive circular clothing industry, according to the benchmark provided by current production systems. This would also result in closer interactions between users and technological platforms. Finally, it was suggested for the retail and distribution stage to explore alternative activities in relation to the priority circular scenario based on reuse. For example, repair and maintenance services on-site, remanufacturing and refurbishment of garments, and collaboration with the social economy sector to explore how the job losses our model predicted could be prevented.
The baseline mapped all of the activities in the clothing value chain in the Netherlands. We found that in 2019 a small fibre, textile and clothing industry remains, although mostly focused on technical fibres and household textiles. Still, approximately six kT of clothing are locally produced, which accounts for 1,346 FTEs including fibre, textile and clothing manufacturers. Scenario Three, which focused on scaling recycling technologies, also explores the impact this may have on the local development of fibre processing, spinning, etcetera. This scenario predicts that circular jobs could increase by 14%, increasing fibre and textile manufacturing by 5,000 FTEs. This scenario also holds the most potential for technological development and regional coordination with other manufacturing or recycling hubs to spread and develop capacity across Europe.
This research carries a scope limited to the Netherlands' labour market. While material and product flows imported and exported to and from the Netherlands were considered in the model, no assessment has been made on the potential employment loss or creation across other geographies of the textile and clothing value chain that supplies clothing to the Netherlands. We consider it vital to address the challenges of potential employment loss in new clothing manufacturing globally, as well as looking into the potential for improving working conditions and job quality. We therefore encourage any current or future research considering this topic, such as the Keeping Workers in the Loop project led by Business for Social Responsibility (BSR) or the ongoing research of the University of Utrecht aimed at assessing the social impacts of Circular Strategies in the apparel value chain through job quality, sustainable livelihood and gender equality.
The scenario focusing on increased resale and repair does entail reduced production of new clothing. This means, as mentioned during the webinar, that this scenario entails significant employment loss at the retail and distribution stages, as well as a reduction in imports of new clothing, which in turn may affect employment along the global manufacturing value chain. Therefore, there is a need to focus on how jobs can be transitioned, and which reskilling activities need to be employed to ensure that workers are not left behind in the transition. This may also entail changing the business models of companies in retail and distribution today, for example, by diversifying their businesses to include repair or resale services.
This is a question of significant importance. The research we have undertaken looks in depth at job creation, substitution and elimination; as well as skills development needed to shift to a circular economy. However, there is a need to ensure that the jobs created are decent and safe. This indeed needs alignment in accordance with widely recognised International Labour Standards such as those set by the International Labour Organization, as well as clear monitoring and reporting requirements and incentives set by national and regional governments to ensure that circular business models and value chains are held to the same accountability as any other business.
Although manufacturing, tailoring, assembly and sewing skill sets are already being taught and are present in the Dutch labour market, the scale of their presence today is quite limited and will require a much larger number of skilled trade workers for (dis)assembly, repair and maintenance activities. Skills needed include creativity, planning, knowledge of fabric properties and functionality, and the ability to handle uncertainty.
The focus for our skills analysis has been placed on repair, resale and textile collection and sorting activities. Of course, other parts of the value chain will also require new and changing skills to adjust to the circular economy and we very much look forward to deep-diving into these activities for further analysis through future research.
A key outcome of the skills analysis indicated that assessing the 'reusability' of incoming clothing will be an essential skill to scale in a circular scenario, such as the one assessed. This will not only entail assessing whether a garment is reusable or not in its current state, but also understanding which parts of clothing could easily be disassembled and used in the remaking and refurbishment of other parts of clothing. Such skills will be especially useful in creating value out of a new, increasing and ever-changing material stream available for reuse, repair and remanufacturing.
Although much yet remains to be done, there are several examples in the Netherlands where you already see work in this regard taking place. To mention some of them: Circular Craft Centres collaborating with Vocational Education institutions, IKcircuLEER and Circular Friesland | SPARK the Movement developing an educational manual on circular skills in construction with the cooperative Leerer voor Morgen, Amsterdam Economic Board and the Municipality of Amsterdam leading the signature of the Green Deals for Circular Textiles
We need the circular economy to be a global shift in our current economic model: hence, everyone can support it. We encourage you to share and contribute any best practices you know of in your local environment on Circle Economy's Knowledge Hub.
The scenario that proposes a scaling up of reuse and repair operations indeed foresees that many underlying policies and incentives are yet to be put in place. One of the most relevant ones is that, as repair may entail lifetime extension and reduction in first-hand sales, mindset shifts regarding how we value our clothes must take place, to ensure that citizens and consumers also see the value of a repair over a new purchase. Additionally, policies that could be put in place to support this shift may include tax reductions that incentivise resale and repair activities, public investments in R&D and demonstration projects of these value chains, eco-design guidelines and requirements for how clothing entering the market is produced (for example, ease of disassembly, modularity, recyclability) and many others.
'Businesses such as Patagonia have been investing for several years in R&D and in providing incentives to consumers to repair its clothes. This approach is enticing from a green standpoint, however it’s clear that incentives are not correctly aligned when you do consider the adoption of a similar stance on a larger scale.' (participant contribution)
In the scope of this study we have not evaluated price changes for specific product categories. Depending on the way responsibilities are set up within the different business models, the cost of repairs can be absorbed either by brands or by customers. There are models that offer lifelong repairs at their stores (for example, Patagonia and Nudie Jeans), while others rely on third party solution providers, and others assume the consumer will be taking those items to local, independent repair stores. Yet, the way in which the business model and the incentives for repair are set up will indeed have a diverse impact on product pricing.
Most of the interviewees across our skills analysis recognised that although many technical aspects need to change in order to realise this scenario, most importantly, changes in mindset, attitude and values are the overarching enabler for the shift in the sector, and more broadly in society. Most changes relate to shifts in the way we value our clothing, as well as the development of attitudes that enable us to manage and better deal with complexity and uncertainty.