The U.S. textile and apparel industry has undergone significant transformation over recent decades, adapting to global market forces while maintaining resilience in key sectors. According to a newly updated report by Dr. Sheng Lu, Professor at the Department of Fashion & Apparel Studies, University of Delaware, the industry has stabilized and evolved despite historical challenges from automation, import competition, and shifting comparative advantages.
Stability Amid Transformation
Despite decades of decline, recent data shows remarkable stability in the U.S. textile and apparel manufacturing sector. As Dr. Lu notes in his April 2025 report, "the U.S. textile and apparel manufacturing sector has stayed relatively stable in recent years." Specifically, "the value of U.S. yarns and fabrics manufacturing (NAICS 313) totaled $24 billion in 2023, up from $23.3 billion in 2018 (or up 2.8%)" This growth, though modest, represents a significant achievement given the sector's historical challenges.
The report also highlights that "U.S. made-up textiles (NAICS 314) and apparel production (NAICS 315) moderately declined by only 1.8% and 1.6%" over the same period. This relative stability suggests successful adaptation strategies within the industry.
Key Industry Trends
1. Shift Toward High-Tech Textile Production
One of the most significant developments is the industry's pivot toward specialized textile manufacturing. Dr. Lu's research reveals that "'Made in the USA' increasingly focuses on textile products, particularly high-tech industrial textiles that are not intended for apparel manufacturing purposes."
The data supports this trend decisively: "Textile products (NAICS 313+314) accounted for over 83% of the total output of the U.S. textile and apparel industry as of 2023, much higher than only 56% in 1998," says Lu, 2025, citing the U.S. Census. This represents a fundamental restructuring of the industry's focus and capabilities.
Growth has been particularly strong in innovative categories. As Dr. Lu reports, "Textiles and apparel 'Made in the USA' are growing particularly fast in some product categories that are high-tech driven, such as medical textiles, protective clothing, specialty and industrial fabrics, and non-woven" (Lu, 2025). The nonwoven fabric sector exemplifies this trend, with production increasing by 12.32% between 2019 and 2022, "much higher than the 1.15% average growth of the textile industry" overall.
2. Micro-Factory Model in Apparel Manufacturing
The structure of U.S. apparel manufacturing has evolved toward smaller, more specialized operations. Dr. Lu's analysis shows that "U.S. apparel manufacturers today are primarily micro-factories, and they supplement but are not in a position to replace imports."
The scale difference is striking: "As of 2021, over 76% of U.S.-based apparel mills (NAICS 315) had fewer than 10 employees, while only 0.7% had more than 500 employees." This contrasts sharply with overseas production facilities where "contracted garment factories of U.S. fashion companies in Asia, particularly in developing countries like Bangladesh, typically employ over 1,000 or even 5,000 workers."
These smaller U.S. operations serve specific functions in the global supply chain, with Dr. Lu noting that "most U.S.-based apparel factories are used to produce samples or prototypes for brands and retailers.". This specialization reflects a strategic adaptation rather than an attempt to compete with mass production overseas.
Meanwhile, the textile manufacturing sector shows a different pattern, with "approximately 5% of U.S. textile mills (NAICS313) had more than 500 employees as of 2021." Dr. Lu emphasizes this is "a significant number, considering that textile manufacturing is a highly capital-intensive process."
3. Declining Employment with Rising Productivity
Employment trends continue to reflect ongoing technological transformation. According to Dr. Lu's report, "employment in the U.S. textile and apparel manufacturing sector (NAICS 313, 314, and 315) totaled 270,700 [in 2024], a decrease of 18.4% from 33,190 in 2019."
However, this decline has been accompanied by significant productivity improvements. Dr. Lu notes that "U.S. textile and apparel workers had become more productive overall—the labor productivity index of U.S. textile mills (NAICS 313) increased from 89.7 in 2019 to 94.4 in 2023, and the index of U.S. apparel mills (NAICS 315) increased from 105.8 to 110.78 over the same period."
The retail sector has become the dominant employer in the broader textile and apparel ecosystem, with "clothing retailers (NAICS 4481) account[ing] for over 75.7% of employment in the U.S. textile and apparel sector in 2024."
4. The Crucial Role of International Trade
Dr. Lu's research emphasizes that "international trade, BOTH import and export, supports textiles and apparel 'Made in the USA'" (Lu, 2025). Export markets are vital to the industry's success, with "U.S. textile and apparel exports exceed[ing] $12.5 billion in 2024, accounting for more than 30% of domestic production as of 2023."
Regional trade agreements have shaped export patterns, with "the Western Hemisphere stably account[ing] for over 70% of U.S. textile and apparel exports over the past decades" thanks to agreements like USMCA and CAFTA-DR. However, Dr. Lu notes that "for specific products such as industrial textiles, markets in the rest of the world, especially Asia and Europe, also become increasingly important."
Imports also play a supportive role in domestic manufacturing. Dr. Lu cites a 2023 study finding that "among the manufacturers in the 'Made in the USA' database managed by the U.S. Department of Commerce Office of Textile and Apparel, nearly 20% of apparel and fabric mills explicitly say they utilized imported components."
This reliance on imports is particularly pronounced among smaller manufacturers: "whereas 20% of manufacturers with less than 50 employees used imported input, only 10.2% of those with 50-499 employees and 7.7% with 500 or more employees did so." This finding underscores "the necessity of supporting small and medium-sized (SME) U.S. textile and apparel manufacturers to more easily access their needed textile materials by lowering trade barriers like tariffs."
Implications for Industry Stakeholders
Dr. Lu's comprehensive analysis suggests several strategic considerations for businesses in the textile and apparel sector:
- Investment in high-tech textiles: The growth in specialized textile categories like medical textiles, protective clothing, and nonwoven fabrics represents a clear opportunity for manufacturers looking to capitalize on "Made in USA" advantages.
- Realistic approach to domestic manufacturing: As Dr. Lu states, "replacing global sourcing with domestic production is not a realistic option for U.S. fashion brands and retailers in the 21st-century global economy." Companies should focus on strategic integration of domestic capabilities within global supply chains.
- Productivity enhancement: The data showing improved productivity suggests continued investment in technology and process improvement remains essential for maintaining competitiveness.
- Trade policy engagement: Given the importance of both exports and imports to the sector, stakeholders should advocate for policies that facilitate access to global markets and materials.
Dr. Lu's findings paint a picture of an industry that has adapted to global realities while maintaining core strengths in specialized areas. Rather than attempting to recapture mass production of apparel, the U.S. textile and apparel sector has evolved toward higher-value, technology-driven manufacturing that leverages American advantages in innovation and capital investment.
Photo by Shari Sirotnak on Unsplash
