It was last weekend when an article in The Age caught my eye. The headline was “Undies index looking up”! It appears that there is an economic rule of thumb, championed by the former head of the U S Federal Reserve, Alan Greenspan, which is viewed as a crude means of detecting a looming recession or the beginnings of a recovery. It is based on the theory that men will cut back on buying underwear when they are worried about their finances.
So, as the article reported, things are looking positive for the Australian economy. Big W reported that sales of men’s underwear increased 12% in 2020-21 compared to the previous year, but have fallen since June, driven by COVID-19 lockdowns in Sydney and Melbourne.
Aussie Bum managing director, Sean Ashby, stated that the business had seen a steep rise in sales, with the last financial year being the company’s best on record. “Most men perceive underwear as a luxury purchase and tend to reduce spending on these products during periods of economic uncertainty” according to an IBIS world spokesman.
So what of female fashion? I decided to Google this, only to find another startling trend of which I was unaware. I came across a wonderful article in The Guardian “Can the ‘high heel index’ predict economic growth?”
You will have heard of the hemline index. It was first theorised in 1926 by the economist George Taylor and stated that skirts get shorter during times of financial prosperity and longer in a recession. But could a parallel theory work for women’s shoes? I remember hearing the claim previously that women’s shoes were recession proof, but could the height of the heel have a parallel with the hemline index i.e. can the height of women’s heels be a good economic predictor?
The ‘exaggerated heel’ has been trending while the hashtag #pleaserheels (named after the high-arched shoe) has had more than 118m views on TikTok. In mid August, Beyoncé paired a black Versace dress with barbie pink jacket and matching pair of super heeled shoes. Earlier in the month, Lady Gaga wore some baby blue body-con athleisure with some extreme platform heels. Apparently, men’s fashion has also seen examples of the ‘exaggerated heel’.
Trevor Davis, a former consumer products expert at IBM, came up with a theory that matched heel length with economic upturns. “The index worked by analysing social media and other online sources for influencer and consumer references to shoes and boots where there was either a specific height of heel mentioned, like ‘four inches’ or a phrase that could be equated easily to a height,” he says. “We then correlated that with a variety of indicators of economic performance to get the index.” He says the data revealed that when economic indicators turned down the heel height initially went up, but if the economy remained in a recession state for more than a few months then heel heights went down.
Davis and his team also found that people were using fashion as a way to navigate through hard times. “We interpreted this as an initial pursuit of glamour to counteract the cold economic winds,” he says. “But with lengthy downturns, an austerity mindset shifted the consumer mood and less ostentation became the norm, and heel heights declined.”
I am now going to watch both trends – especially the exaggerated heel here in Australia!
So next time anyone catches you looking at celebrities on TikTok and accuses you of not working, you can say confidently that you are doing economic research! No need to thank me!