What Is A Recession Indicator, And How Does It Impact The Clothes You Wear

Seems like there are recession indicators everywhere for eyes to see.

Everybody knows about traditional recession indicators like inflation, the decline of the stock market, rising unemployment, and romanticising the idea of buying groceries. But do you know fashion is also an indicator of a collapsing economy? Your jeans, skirts, heels, lipstick, and bags, everything is affected by this phenomenon. So, here is everything you need to know about the relationship between recession and the fashion industry. 

Rise Of Quiet Luxury 

The resurgence and popularity of plain logo-less fashion is often seen as a soft signal of economic uncertainty. The shift from maximalist flashy clothes to subtle, understated fashion is sometimes interpreted as a preference for enduring value and a way to signal wealth discreetly during times of economic instability. Following the 2008 recession, a wave of minimalism swept through fashion that was fueled by simpler aesthetics, and we can’t help but see this trend resurge in 2025. 

Revival Of Business Casual

Kim Kardashian said it seems like no one wants to work these days, so we made models on runways wear office fits. This perception stems from the idea that a return to more formal and conservative styles like business casual could signal a shift back to a more traditional workplace environment, driven by rising financial pressure and job security concerns.

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The Lipstick Index

The lipstick index is an economic indicator that suggests increased sales of affordable luxury items, like lipstick, during economic downturns. It’s the idea that when consumers reduce spending on expensive items, they may still indulge in purchasing smaller items like lipsticks, which could still bring them joy by spending less money. This concept was coined by Leonard Lauder, the CEO of Estée Lauder, in 2001 during a recession.

The High Heel Index

The High Heel Index is another economic indicator that suggests an inverse relationship between the height of women’s heels and the state of the economy. The theory suggests that during economic downturns, women tend to wear higher heels as a form of escapism.

Whether all these theories are real or not, and whether the impending doom of a financial crisis is upon us, is up for debate. But it certainly is fascinating to observe how decades-old trends resurface in relation to the current global economic situation.

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First Published: May 21, 2025 5:57 PM