Covid contracts gave the fashion industry a boost. Can it survive normalcy?

Jul 13, 2021
In The News

When Rachel Rothenberg-Saenz, former director of product development at Oscar de la Renta, was furloughed in the spring of 2020, she heeded Gov. Andrew Cuomo’s call to help with the shortage of personal protective equipment

“We pivoted and called everyone we knew from years in the industry,” Rothenberg-Saenz said.

With a colleague, she started a nonprofit and then a company to make and sell medical gowns and masks, turning donated thread from Oscar and elastic from Alice & Olivia into early iterations.

The company, Goldatech, is now doing well, she said, thanks to contracts with the state and the city, Northwell Health and the Arizona Department of Health. New products, including scrubs, are in development, and the company is researching supply chains and textiles to continue growing its businesses.

But Rothenberg-Saenz’s win belies the industry’s worries about its future, a little more than a year after its production factories and pattern makers leaped into action to produce hundreds of thousands of PPE locally.

“Using the Garment District’s talent, factories and resources, New York City was able to produce PPE for hospital workers,” said Rep. Carolyn Maloney, who held a discussion Monday to look for solutions. “Now, as we are entering a post-pandemic world, it is essential we reinvest in the businesses that made it possible for us to get through the Covid-19 pandemic.”

That includes coming to terms not just with the aftereffects of Covid-19 closures but with the same existential challenges that faced the industry before the pandemic, primarily that producing goods locally costs far more than importing them.

Apparel manufacturing jobs in the city have been plummeting for decades. There were a bit more than 9,000 of them before the pandemic began, a 90% decrease since 1990. About half the industry is still in Midtown, while the other half has set up shop in Brooklyn and Queens.

The fashion sector is broader and stronger, with 900 city businesses generating 180,000 jobs and $11 billion in wages, according to Maloney. 

The boost from Covid-related spending has been substantial. In fiscal years 2020 and 2021, the city has committed to a total of $8 billion in virus-related outlays, according Comptroller Scott Stringer. 

“A market was created,” said Barbara Blair, president of the Garment District Alliance. “We had an ability to respond to a market. But what happens when you have no market?”

It has meant, for example, that Alexander Campaz, founder of Infinite Wave, a New York City development and production company, could not drum up enough business to reach capacity. He got two city contracts, he said, and was making 20,000 isolation gowns per week.

“With another contract we could have made 80,000,” Campaz said. He bid but did not secure more contracts.

The current high level of city and state spending is not going to last. The city's Covid spending is expected to drop to $4.95 billion next year and then to $456 million in 2025, Stringer said. 

In fact, the strategy of producing from local companies to avoid supply-chain crunches might have already expired, Rothenberg-Saenz said. She said she has noticed public and private institutions are returning to overseas vendors instead.

The remaining fashion companies in the city have held on using a variety of strategies. That includes marketing their products as luxuries, worth the cost of being made here, or as environmentally responsible because they avoid the typical, sometimes-problematic fashion supply chain.

Creating products close to home and on demand might be the best bet for survival, said Kay Unger, a fashion designer who has led the local industry in recent years.

“With the clogged-up supply chain,” Unger said, “we have the space to make less stuff on demand, and it costs the same with less waste.”