Second quarter 2026 and prospects
Exports return to growth and job losses ease,
but clothing production and business confidence remain under pressure.
The EU textile and clothing (T&C) industry showed tentative signs of stabilisation in Q2 2026, with turnover improving markedly: textile turnover returned to growth (+0.3% year-on-year) for the first time in over two years, while clothing turnover, though still negative (-3.9%), moderated slightly from Q1. Across all manufacturing, turnover rose a strong +4.9% year-on-year, well ahead of the T&C sector.
EU T&C production remained in negative territory in Q2 2026, but the pace of decline eased for textiles (-3.1% year-on-year, from -4.0% in Q1) while clothing losses deepened further (-6.2%, from -5.4% in Q1). Production trends were highly divergent across Member States, ranging from a double-digit decline in Poland (-16.5% in textiles) to double-digit growth in Denmark (+19.4%).
Employment losses eased markedly, with clothing employment turning marginally positive (+0.1% year-on-year) for the first time in over a year, while textile employment losses moderated to -0.3% (from -1.8% in Q1). This brought the sector’s employment trend broadly into line with the wider manufacturing base.
On the external side, EU T&C exports returned to year-on-year growth (+1.4%) for the first time in over a year, led by strong gains to China in both textiles and clothing, while imports declines eased sharply to near-flat (-1.1%, from -10.1% in Q1). As a result, the EU T&C trade deficit continued to narrow (-3.6% year-on-year), and unlike in Q1 (when the narrower deficit reflected shrinking trade volumes on both sides), the Q2 improvement appears to reflect a genuine strengthening in export performance.
EU Business confidence in the textile industry picked up further in September 2026 and rose above its long-term average, due to more optimistic views on order books levels. In the clothing sector, confidence improved markedly, following a substantial improvement in the assessment of stocks of finished products and firm production expectations, though it remains well below its long-term average.
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