Clothing prices are being slashed, part of a long-term trend toward discounting

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If you’re looking for new shirts, pants or boots, you’re in luck: the clothing industry is lowering prices.

Clothing and footwear prices fell 4.4 percent in September from a year earlier, according to consumer price index figures released on Tuesday. This is not a new phenomenon for the apparel industry, but rather part of a decades-old discounting trend.

According to Statistics Canada calculations, nominal prices for clothing and footwear have fallen 7.4 percent since the turn of the century. The trend is completely different for general consumer prices, which have risen by 72 percent in the same period.

If anything, these numbers underestimate the extent to which clothing is becoming increasingly cheaper. In inflation-adjusted dollars, prices for clothing and shoes have fallen 46 percent since 1999.

There are several explanations for why clothing is so cheap, including the rise of fast fashion brands and the shift of clothing production to low-wage markets abroad. But what is good news for consumers is bad news for the environment. The clothing industry is a major polluter. And because $10 T-shirts and $30 sweaters are on the rise, consumers are buying more clothes and renewing their wardrobes more frequently.

There’s another reason for the recent price reductions: Some apparel companies are struggling in this sluggish economic environment, leaving them with plenty of inventory to sell.

In the first seven months of the year, clothing retailers recorded sales of $16.8 billion – a slight decline from the same period in 2023, according to figures from Statscan. Adjusted for inflation and Canada’s rapid population growth, the decline in apparel sales is more noticeable.

Decoder is a weekly feature that unpacks an important economic chart.