Women in the fashion and leather sector in Italy earn 5.4% lower than their male colleagues, says a report by the Global Fashion Agenda (GFA) that has also come up with a call to action to achieve pay equity.
LOW WAGES: The report, Unpacking Pay Equity in Fashion: Italy | Insights on the Italian Fashion Manufacturing Industry says that the fashion and leather sector offers lower hourly wages, fewer benefits, and limited opportunities for career advancement, resulting in a significant reduction in the average female wage.
- According to the National Social Security Institute (INPS) data on private sector employment, in 2022 women in the Italian textile industry earned €80 daily (average daily salary based on the cumulative number of days worked) while men earned €107 a day.
- In the tanning and leather industry, women on average earn €82 and men €100.
- Overall, for every €1 earned by men, women, on average, earn €0.81, resulting in a 19% salary difference.
- The breakdown of the gender pay gap based on 2018 data shows that women, based on their personal characteristics and job positions, should have had a salary 5.4% higher than their male colleagues.
- This means that the overall gender discrimination in the labour market in that year amounted to 10.9% of the male wage
- In considering the challenges encountered within the Italian fashion manufacturing industry, characterised primarily by micro and small family-owned enterprises, that will not be affected by compliance obligations in the medium term, it is imperative to consider regulatory interventions that foster transparency within these small-scale entities and their subcontractors.
METHODOLOGY: GFA and PwC worked on this report to capture insights through 25 brand interviews, analysis of GFA and UNEP’s global Fashion Industry Target Consultation 2024, and a survey among 105 Italian manufacturers thanks to industry collaboration with Camera Nazionale della Moda Italiana (CNMI), Confartigianato Moda and CNA Federmoda.
RECOMMENDATIONS: CALL TO ACTION To achieve pay equity in the Italian fashion manufacturing industry, a collective cultural effort is needed.
- Understanding the role that social and cultural norms, including asymmetries in domestic and caregiving responsibilities, have on the gender pay gap and other gender disparities is crucial.
- Organisations must implement actions to bridge the gap between EU regulations and brand policies.
- Measures in support of an inclusive culture that values parenthood are particularly important.
- Additionally, it is essential to increase awareness among business owners and CEOs of the gender pay gap and develop tools suitable for the unique context of the Italian fashion industry.
- Developing and integrating responsible purchasing practices across the due diligence steps (adopting appropriate policies, control measures, tracking and reporting) is crucial for reducing income and wage harm.
- There is a need to establish a unified methodology to measure pay equity within companies and to avoid overlap and discretion in assessments by manufacturers.
- Lastly, it is fundamental to establish full transparency and traceability in the Italian fashion supply chain, ensuring that subcontractors are formally included in the value chain and ethical production is guaranteed.
THE CHAIN: Over 600,000 people are employed in the fashion manufacturing industry in Italy.
- In 2022, women accounted for around 60% of the workforce in textile and apparel industries, twice as much as the female presence in the whole Italian manufacturing sector.
- Italy has witnessed an increase in the representation of women on the boards of fashion companies, rising to 27% in 2023 from 21.3% in 2020. This change is mainly attributed to a growing attention to gender inequalities resulting in more policies and laws supporting female quotas in corporate leadership, leading to a positive impact on gender equality.
- Overall, women are overrepresented in lower paying positions (in the leather and tanning sector, 66% of workers are women) and underrepresented in leadership positions (in the leather and tanning sector, only 31% of managerial roles are occupied by women, a percentage that drops to 17% in the textile sector).
- Furthermore, working conditions and contracts vary significantly across genders: over 70% of part-time workers are women in the textile industry, and 58% in the tanning and leather industry. This has an impact on the pay gap.
ITALIAN FASHION MANUFACTURING: Over 80% of the Italian fashion manufacturing industry is constituted of microenterprises with less than 10 employees, 18.5% are SMEs (10-249 employees), and 0.2% are large enterprises (above 250 employees).\
- Due to their size, the vast majority of these enterprises are exempt from adhering to some EU and Italian regulations pertaining to equal pay and gender equality. However, many of these manufacturers (albeit small) are in the supply chains of large Italian and other European brands that will need to comply with those.
- The determination of standard reference salaries for various organisations and sectors within the industry occurs through collective bargaining agreements as outlined in the National Collective Employment Contracts (in Italian “Contratto Collettivo Nazionale di Lavoro” or CCNL). There is no data source on the use of local subcontractors, as this is often an informal practice.
Women’s participation in the Italian labour market is low: in 2023 the female employment rate was 52.5%, almost 20 points lower than the male employment rate (70.4%), with wide regional variations.
- Female employment rate in Italy is lower than the one of Greece (52.8%) and Romania (54.3%) and far behind the Netherlands (78.9%) and Sweden (75.6%).
- The fact that the unadjusted gender pay gap measured in Italy is among the smallest in Europe is partly due to the higher representation in the workforce of women with a higher level of education and therefore well-paid jobs, while women with a lower level of education (and typically lower wages) have a lower labour market participation rate.
- The fashion manufacturing industry partially differs from the data observed at the national level, in that it is characterised by an over-participation of women compared to the Italian average, especially in non-managerial roles.
OVERVIEW: ITALIAN FASHION MANUFACTURING: Italian fashion manufacturing involves apparel (including fur), textile, footwear, leather and tanning, and accessories (including jewellery and eyewear) industries.
- In 2023 the sector recorded an annual revenue of over €100 billion, with a 4% growth in comparison to 2022. Similarly, exports have seen an increase of 4.2% with a value of almost €90 billion in the same year.
- The sector is made up of around 60,000 companies, of which 81.3% are classified as microenterprises with less than 10 employees, 18.5% are SMEs (10-249 employees), and only 0.2% are large enterprises (more than 250 employees).
- In particular, in the fashion supply chain, family-owned enterprises represent 85.2% of all businesses, with a peak among microenterprises at 86.4%.17 In 2012, 16.6% of Italian fashion & textile manufacturing factories were owned by Chinese companies, mainly in Lombardy, Tuscany, and Veneto.
- Another feature often mentioned in connection with Italian fashion manufacturing is local subcontracting. Small manufacturers are working with subcontractors and quick order delivery while keeping costs down.
- A large part of the production caters to luxury. As for all other industries in Italy, the standard reference salary for manufacturing is defined by the National Collective Labour Agreements (CCNL) through collective bargaining agreements.
- CCNLs are signed by the trade union members of the representative national confederations and the relevant employers’ associations.
- The advantages of CCNLs include provisions that benefit all workers regardless of the job qualification, such as wage increases, employer contributions to have flexibility, and quick order delivery while keeping costs down.
- OECD and industry associations research reveals that it is often challenging for suppliers to increase wages.
THE TEAM: The report has been authored by GFA’s Sara Zanellini and Giulia Grossi, Holly Syrett and Sonia Hylling from PWC, and GFA designer Florinda Pamungkas.
PARTNERS: Bestseller, H&M Group, Kering, Nike, Ralph Lauren Corporation and Target, Allbirds, ASOS, Erdos Group, Ganni, Neiman Marcus Group, Puma, PVH Corp, Tal Apparel, Zalando, Apparel Impact Institute, Ellen MacArthur Foundation, Fair Labor Association, Social & Labor Convergence Program and Textile Exchange, Fashion For Good and Re&Up.
WHAT THEY SAID:
Through this collaborative effort, we have identified key opportunities to improve transparency, empower women and other historically marginalized communities, and further integrate the fundamental Italian values of art and expertise into every aspect of the fashion industry’s operations. These actions will not only strengthen the resilience of our sector but also ensure that the Italian textile and clothing industry is future-proof. The report, “Unpacking Pay Equity In Fashion: Italy”, indeed aims to outline efforts to address encountered issues. By embracing these changes, we can achieve not only significant returns but also have a positive impact on our sector and on society.
— Carlo Capasa
Chairman
Camera Nazionale della Moda Italiana
