First quarter 2026 and prospects
The EU textile & clothing industry faced renewed headwinds in early 2026.
Exports, turnover, production and employment all declined further in the first quarter.
The EU textile and clothing (T&C) industry continued to face significant structural challenges in Q1 2026, as turnover contracted sharply in both sectors (-3.0% in textiles and -4.2% in clothing year-on-year), extending the downward trend in place since 2023. Weak EU domestic demand, intensified competition from low-cost imports, and a subdued global trade environment remained the dominant headwinds. No signs of stabilisation emerged at the start of the year, marking a deterioration relative to the more contained losses recorded at end-2025.
EU T&C production declined further in Q1 2026, with textiles down -4.2% and clothing down -5.1% year-on-year — both steeper falls than in the previous quarter. Lack of demand remained the single most important factor limiting industrial activity, while competitive pressures from third-country producers continued to weigh on output across most sub-sectors and member states.
Employment in the sector continued its downward trend in Q1 2026, with textile employment falling by -1.8% and clothing employment by -1.5% year-on-year. Restructuring, high input costs, and skill mismatches continued to drive workforce reductions across the EU, with particularly steep declines recorded in Central & Eastern European manufacturing hubs.
On the external side, EU T&C imports from third countries fell sharply (-11.4% in value year-on-year), driven by weakening domestic demand and lower import prices. Exports also declined (-2.7%), extending the erosion in EU external competitiveness. As a result, the EU27 trade deficit narrowed by -19.1% year-on-year, though this improvement reflects a compression of trade volumes rather than a structural recovery.
EU Business confidence in the textile industry picked up in June 2026, due to more optimistic views on order books, stocks and production expectations. In the clothing sector, confidence declined slightly, mainly driven by weaker assessment on stocks and order-book levels.
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