2,659 Companies Closed in the Apparel and Ready-to-Wear Sector

With its labor-intensive structure providing jobs for hundreds of thousands of people, the sector is experiencing one of the sharpest contractions in recent years due to shrinking global demand, rising costs, and weakened competitiveness. According to data from the Social Security Institution (SGK), in May 2025 alone, 12,286 people left their jobs. In the first five months of the year, total employment losses in the sector reached 45,904. During the same period, 2,659 companies shut down.

From Record Employment After the Pandemic to a Sharp Decline

The apparel and ready-to-wear sector surpassed the 1 million employment threshold in 2020, marking a historic achievement. However, this peak was short-lived.

• In 2022, employment reached 1,222,000 people, the highest level ever recorded.
• In 2023 and 2024, global demand contraction, rising energy and raw material costs, and competitive pressure triggered steep declines in employment.
• In the whole of 2024, the apparel and ready-to-wear sectors experienced a loss of 65,000 jobs.

The loss of 45,000 jobs in just the first five months of 2025 has fueled concerns that this figure could reach 80,000 by the end of the year.

Striking Decline in the Number of Companies

According to SGK data:

• At the end of 2024, the number of companies operating in the sector stood at 59,101.
• By May 2025, this number had fallen to 56,442.
• In just five months, 2,659 businesses ceased operations.

A significant portion of these closures consisted of small and medium-sized enterprises (SMEs). Rising energy prices, increased labor costs, exchange rate instability, and difficulties in accessing finance have put small businesses under severe strain.

Alarm Bells for Women’s Employment

The apparel and ready-to-wear sector is among the industries with the highest share of women’s employment in Turkey. A large proportion of workshop and production line workers are women. For this reason, the contraction in the sector has significant social as well as economic consequences.

The loss of jobs among female workers causes substantial declines in household income and a reduction in overall social welfare. Sector representatives warn that the social impacts of this situation will become more visible in the medium and long term.

Demand Contraction and Export Losses

The Sectoral PMI data announced by the Istanbul Chamber of Industry clearly reveals the deterioration in the sector.

• In July 2025, the decline in new orders in apparel and leather products was recorded as the sharpest among the 10 sectors monitored.
• Textile and apparel manufacturers have implemented price reductions for five consecutive months to stimulate demand.
• Supplier delivery times have shortened for eight consecutive months due to weak demand.

Data from the Turkish Exporters Assembly (TİM) also confirms the picture:

• In January–July 2025, ready-to-wear exports fell by 6.2% to $9.7 billion.
• Exports of apparel products increased by 1.8% to $5.5 billion, mainly due to price reductions. However, much of this increase was driven by lower unit prices rather than higher sales volumes.

Competitiveness Weakening

Sector representatives state that the price gap between Turkey and competing manufacturing countries has reached 50–60%. Aggressive pricing policies from countries such as Bangladesh, Vietnam, Pakistan, and China are reducing Turkish manufacturers’ market share in both Europe and the United States.

On the cost side:

• Persistently high energy prices
• Minimum wage hikes
• Exchange rate fluctuations
  are among the main factors limiting competitiveness.

The Sector’s Expectations for Solutions

The apparel and ready-to-wear sector is calling for urgent measures to overcome this bottleneck. Prominent solution proposals include:

• Increasing government support and introducing incentive packages specifically for SMEs
• Easing access to financing
• Promoting the production of high value-added and branded products for export
• Reducing raw material and energy costs
• Accelerating the adaptation process to the European Green Deal

2025 Could Be the Toughest Year of the Last Decade

If current conditions remain unchanged, 2025 is expected to go down as the toughest year in the last decade for apparel and ready-to-wear. The sector warns that, unless the contraction in both domestic and export markets is stopped, job losses could exceed 80,000 and the number of company closures could surpass 5,000.