The Emergence of Los Angeles as a Fashion Hub: A Comparative Spatial Analysis of the New York and Los Angeles Fashion Industries

The US fashion industry is a useful lens through which to view the transformation of the country’s urban economic systems. Initially an industrial vanguard, fashion has evolved into a more design-oriented sector and a central part of the ‘cognitive-cultural economy’. Fashion is also a clear demonstration of place-specific comparative advantage and specialisation, intensely linked to ‘place in product’. The paper traces the fashion industry’s evolution from 1986 to 2007, focusing on New York and Los Angeles. The composition of the industry in each locale demonstrates each city’s comparative advantage and these advantages may be key determinants of their future fortunes. Using geographical information systems (GIS), fashion’s current spatial form is studied. Within the industry’s sub-sectors, spatial patterns and similar geographical clustering emerge. The industry may be facing somewhat of a reconfiguring of its economic geography; however, the fashion industry’s spatial-structural patterns persist within each city. We also find that fashion, like high technology and Hollywood, tends to produce regional network agglomerations, strong headquarter cities and co-location of particular sectors. Our findings are consistent with the larger theoretical and empirical observations on the post-industrial landscape. through which to view the transformation of the country’s urban economic systems over Introduction The US fashion industry, a vanguard of the manufacturing economy, is a useful lens at NORTH CAROLINA STATE UNIV on March 13, 2013 usj.sagepub.com Downloaded from 3044 SARAH WILLIAMS AND ELIZABETH CURRID-HALKETT the past 20 years. While its roots can be traced to a strong manufacturing base located in US urban cores, rather than becoming obsolete, the industry has evolved into a more designoriented sector that has become a central part of what Scott (2008a, 2008b) calls the ‘cognitive-cultural economy’ and its accoutrements of new media, consumption spaces and ‘buzz’ (Currid and Williams, 2010a). Fashion is strongly aligned with the new ‘creative’ thrust of contemporary economic development practice and urban policy (Evans, 2009; Ponzini and Rossi, 2010; Pratt, 2009). The domestic manufacturing of fashion has given way to a highly semiotic production process that is synergistic with other cultural and consumption-oriented industries (Scott, 1996; Currid, 2007). The industry relies on media and prestigious design institutes churning out highly skilled labour as much as factories and economies of scale (Rantisi, 2002, 2004). In this paper, we look at the evolution of fashion as a conventional manufacturing-based industry and its increasing role as a design industry that creates symbolic content in the contemporary 21st-century metropolis, a place marked by spaces of consumption, amenities and city branding (Zukin, 1998; Florida, 2002; Clark, 2004; Glaeser et al., 2004, among others). Building on the work of Rantisi (2002, 2004), we study the industrial dynamics of New York City’s fashion industry. We expand upon Rantisi’s pioneering work by looking at the way in which the industry has evolved differently in Los Angeles and compare the spatial breakdown of the industry in these distinct locales. In order to unpack the ways in which the industry contributes in different ways, we break down the fashion industry into four parts—manufacturing, wholesale, supply and design—and trace these sectors over time. While we commence our analysis with a national and metro comparison, we then narrow our focus to the US fashion capitals: New York and Los Angeles. Using County Business Pattern data, we trace the evolution of the industry in each city from 1986 (which we use as a proxy for the decline of the urban manufacturing economy) to 2007. We analyse the industry’s composition over time and consider each city’s comparative advantage and how these advantages may be key determinants of their future fortunes. In the final part of our analysis, we conduct geographical information systems (GIS) analysis of the spatial attributes of the current composition of the fashion industry in each city. We find that spatial concentration is more evident in New York than Los Angeles due to both spatial form and the nature of the industry in each locale. However, we find that, within the industry’s sub-sectors (design, wholesale, manufacturing and supply), spatial patterns and similar geographical clustering emerge. We observe that the industry may be facing somewhat of a reconfiguring of its economic geography; however, the fashion industry’s spatial-structural patterns persist within each city. Our work informs the extant literature on the importance of cross-fertilisation and geographical proximity in post-industrial economic development. While previous work has documented the importance of these geographically embedded mechanisms, we hope our research illuminates the spatial configurations of the important social and economic processes that occur within industrial clusters. We also find that, like other innovation-driven industries (such as technology, finance), fashion exhibits strong winner-take-all markets, whereby New York and Los Angeles possess a disproportionate concentration of the sector. We conclude with a discussion of current policy and economic development measures targeting the fashion industry in each city and the impact of broader forces on the spatial patterns of the industry. Theories and Concepts The Rise of the Post-industrial City The deindustrialisation of US urban centres is a story that has been told clearly and cogently at NORTH CAROLINA STATE UNIV on March 13, 2013 usj.sagepub.com Downloaded from LOS ANGELES AS A FASHION HUB 3045 innumerable times, most seminally by Piore and Sable (1984). Market saturation, low-cost overseas manufacturing and relaxing of trade agreements enabled domestic producers and retailers to seek out much cheaper manufacturing elsewhere. The fashion industry was not impervious to this dramatic economic restructuring. Pre-1970 almost all of the US’ apparelsupply chain was located domestically and 70 per cent in large metropolitan areas. One in 10 manufacturing jobs could be found in the apparel industry, with 70 per cent of these jobs being located in large, 500+ employee establishments (Doeringer and Crean, 2006). Since 1980, there has been an 81.5 per cent decline in US apparel manufacturing jobs alone. New York City, the US capital of the fashion industry, experienced almost identical losses (US Bureau of the Census, 1980–2008). Like other manufacturing industries, apparel increased product differentiation and simultaneously moved production offshore to Latin America, Mexico and the Caribbean. These locales were still close enough to deliver on time, but offered far cheaper labour. Today, the majority of US apparel manufacturing establishments have downsized to fewer than 20 workers (Doeringer and Crean, 2006). The fashion industry’s manufacturing collapse mimicked the wider problems facing US industries. Fashion has re-emerged in the cognitive cultural economy (Scott, 2000). While the industry still heavily relies on manufacturing, the design aspect of fashion has become a critical part of the symbolic and cultural capital of cities around the world: New York, Paris, London and increasingly Los Angeles (Molotch, 1996; Rantisi, 2004; Currid, 2007). Additionally, the industry has incorporated flexible specialisation (Piore and Sabel, 1984), whereby it relies on economies of scope and rapid production of new styles of clothing. Fashion and the Creative City Fashion’s role in contemporary urban economic development revolves partially around the paradigm of cities as spaces of consumption (Zukin, 1995, 1998; Glaeser et al., 2001) or what Clark (2004) calls the “city as an entertainment machine”, whereby amenities and cultural capital are positioned to lure talented labour pools and the ‘creative class’ (Florida, 2002). This emphasis on cultural capital has the second-order effect of enabling places to create their own ‘distinction’ from other places in an increasingly homogenised economy (Markusen and Schrock, 2006). The physical and visual manifestation of such development efforts in this new creative urban agenda appears in boldly expressed slogans concerning the new role of culture and creativity in the physical and economic revitalisation of cities (Mommaas 2004, p. 507). Cultural industries, whether they are defined as the artists moving into loft space or the establishment of a fashion district, have experienced ‘semantic and symbolic expansion’ within this new schema where they are thought to be agents of regeneration in the old urban core (Evans, 2009), along with being viable revenue and job generators in their own right (Currid, 2006; Pratt, 2009). The consumption-oriented development agenda has not been entirely supported; in fact, quite to the contrary. Some scholars have cast this leitmotif in a more cynical light, arguing that cities have forsaken their positions as vanguards of upward mobility to become playgrounds for the élite replete with hip neighbourhoods and music scenes, but absent of middle-class services and rife with class stratification (Kotkin, 2006; Peck, 2005). The role of fashion in both economic and semiotic city development has played out specifically in two US cities: New York and Los Angeles. In her seminal analysis of the fashion industry, Rantisi (2004) found that, since the mid 20th century, US fashion has moved from being a second-tier, apparel manufacturing sector to a world-renowned design-oriented industry, at NORTH CAROLINA STATE UNIV on March 13, 2013 usj.sagepub.com Downloaded from 3046 SARAH WILLIAMS AND ELIZABETH CURRID-HALKETT with its headquarters firmly rooted in New York City. The collapse of the manufacturing sector of the fashion industry forced the industry to downsize, consolidate and ultimately focus on in-house design. In other words, fashion became a designand innovation-oriented industry in order to survive in the post-industrial economy. Certain historical events enabled this transition: the establishment of New York’s semi-annual Fashion Week (tied to the Milan, Paris and London Fashion Weeks), the rise in importance of American Vogue and Women’s Wear Daily and the establishment of prestigious design schools (Pratt, Parsons and the Fashion Institute of Technology) solidified the city’s significance around the world as a serious player (Rantisi, 2004). The city’s dominant position and the US fashion industry’s more recent emphasis on design-oriented production continue to increase in importance over time. Today, New York City is almost 16 times more concentrated in fashion designers than any other US metro. Los Angeles is second, with five times more designers than other metros (Currid, 2006). Nine of the Fortune 1000 companies are fashion industry firms located in New York City. Together, they bring in a combined annual revenue of US$31 billion (Forbes, 2009). The city’s semi-annual Fashion Week alone generates a totally annual economic impact of $733 million (NYEDC, 2009). While New York remains the country’s centre of design, Los Angeles has sought to create an advantage in high-end casual sportswear, even establishing its own Fashion Week and developing a downtown Fashion District. In addition to the more conventional importance of the fashion industry as an important source of city revenue and jobs, both Los Angeles and New York have benefited from the branding that fashion provides their cities and symbiotically the branding these cities provide designers (for example, C&C California, ‘made in New York’ or Andrew Marc New York). Fashion mimics the attributes strongly associated with the post-industrial economy: it relies intensely on knowledge, perpetual innovation and close proximity (Rantisi, 2002; Currid, 2007). The industry also overconcentrates in particular headquarters (New York, Milan, Paris, London and increasingly Los Angeles) that are strongly connected to one another, reflecting a global city network of the cultural industries (Sassen, 2001; Currid-Halkett and Ravid, 2010). The process of ‘getting things done’ occurs in these discrete cities with subsequent distribution of production and products world-wide. As Kawamura (2005) points out, fashion is a ‘collective’ process whereby many different people and institutions are necessary to its productions, including ‘critical intermediaries’ (Zukin and Maguire, 2004), such as fashion magazines and editors, alongside the designers. Yet fashion departs from other examples of innovation-driven industries because it produces tangible products alongside its information and semiotic content. In this respect, particularly in Los Angeles, fashion operates in a dual role in the 21st-century urban economy. Fashion relies on just-in-time materials for preliminary designs, product samples and limited batches of high-end apparel that are not produced offshore. Thus, New York’s Garment District and Los Angeles’ Fashion Districts play important roles not just in facilitating the concentration of designers but also by providing the materials and supplies necessary for the innovation and preliminary production processes (Rantisi, 2002; Currid, 2007). In this respect, the fashion industry operates within a traditional manufacturing agglomeration, retaining clustering qualities similar to Marshall’s (1890/1920) ‘industrial district’ and relying on what Scott (1996, p. 308) calls a ‘durable workforce’. Simultaneously, the designers also produce the intangible buzz and cultural milieu that has become so important to contemporary economic development (Currid and Williams, 2010a). We look at how these facets within the industry play out in Los Angeles and New York, unpacking both their sector and spatial at NORTH CAROLINA STATE UNIV on March 13, 2013 usj.sagepub.com Downloaded from LOS ANGELES AS A FASHION HUB 3047 composition and considering how the distributions within the industry might explain each city’s distinctive role as a fashion centre.