Is It Fashion or Is It Recession?

It appears, dear reader, that we’re living in increasingly un-fergalicious times.

According to Alexandria Ocasio-Cortez, the girls are fighting on the internet (can they work it out on the remix?). Bradley Cooper is prancing around New York in battered Vuitton sneakers, skincare company The Ordinary is selling “ordinarily-priced eggs” in its Manhattan outlets, and—most horrifying of all—Gwyneth Paltrow has decided to start eating cheese again.

Some would say, it’s those Trumpian tariffs, slumping S&P500 stocks (worst recorded since December 2022), or even Wall Street’s tepid readings of Sahm’s Rule, that have us all feeling not so, erm, flossy flossy.

We, the chronically online crowd, however, would like to respectfully disagree.

After all, why must we look to the girls on Twitter when we can look to the girls on TikTok, who are dying their hair “recession-blonde”? Or as the Wall Street Journal notes, “Opening Instagram like, ‘Damn, everyone got their master’s degree this year. Congratulations, but also, recession indicator.”

Welcome to the wonderfully weird world of fashioneconomics, where everything from sales of Lady Gaga tickets to trips to the strip club can (and pretty much will) be considered predictive of an economic downturn. 

Minis Versus Midis: the Classic Controversy

By now, we’re no strangers to recessions. 

People lose their jobs, cut down on spending, and the economy shrinks. And suppose the internet’s most trusted source, Wikipedia, is to be believed. In that case, Americans have lived through as many as 48 recessions dating way back to the Articles of Confederation, notably the Great Depression of 1929, the Great Recession of 2008, and more recently, the COVID-19 recession post-2020.

But among the myriad potent recession indicators, from A-list celebrities doing commercials, to Lena Dunham’s departure from New York, to serif fonts, and press-on nails, few remain as timeless as the Hemline Index.

It was last March when data analyst Madé Lapuerta of the Instagram @databutmakeitfashion posited, “Oh, no, maxi hemlines are up in popularity. Does that mean we’re headed into a recession?” that brought the theory back into the zeitgeist. And coined by economist George Taylor in 1926, it suggests – quite literally – “as the stock market goes down, so do hemlines,” right as the Charleston-era short skirts of the Flappers made way for their lengthier, corporate-appropriate counterparts, that simultaneously registered “lower levels of productive activity (GDP) than expected.”

In millennial-speak, this coincided with the return of business casual. As Vogue notes, “Can we deduce the state of the US economy based on the return of blazers to bar life?” True to form, Stella McCartney’s Autumn/Winter 2025 collection was themed “from laptop to lap dance”.

Could this explain why mini-bags, too, have dropped off the radar?

Lipsticks, Labubus, and the Little Luxuries

Similar to the Hemline Theory is the Lipstick Index, another portent of the coming bad times that has women switching out their luxury “investments” from outfit-upgrades and accessories to more minor splurges, like lipstick.

Unlike the Hemline Index, however, the Lipstick Index has been found to have varied efficacy: According to Kline Cosmetics and Toiletries USA, Estée Lauder’s beauty sales saw a distinct uptick following the September 11 terrorist attacks but dropped during the 2008 recession and the pandemic.

But smaller indulgences go beyond beauty – Pantone’s selection of Mocha Mousse as the color of the year – one that “embodies stability, reliability, and timeless appeal” – has quickly trickled down across all levels of the luxury pyramid to create a homogenized (and much-dreaded) quiet luxury look. 

Fast fashion label Pretty Little Thing’s rebranding to a business casual label composed of “timeless”, “elevated” basics also serves to provide perusers with a piece of the luxury pie without the price tag to boot.

In the handbag-verse, this has manifested in the form of Labubus, bunny-like beings with creepy teethy smiles sold via “blind boxes” by Hong Kong toy company Pop Mart. Hung off their purses, “It’s very deeply psychological,” says fashion podcaster and journalist Angel Nemov, “I think for some people like me, it’s almost that healing of the inner child.”

But as much as this trend of bag charms and chaotic customization is to satisfy the “kidult” customer, it is also a modern-day example of the lipstick effect, whereby buyers are foregoing big spends and instead gravitating towards smaller-value items (a Labubu starts from $20, for instance).

Plus, they’re playful too.

The Mayhem of Men’s Underwear

Elsewhere in pop culture, there’s recession pop—upbeat and danceable pop music that provides a much-needed escape when times are tough. 

In 2008, this was in the form of the Lady Gaga album, The Fame Monster, with perennially popular hits like Just Dance and Poker Face. 17 years later, it’s still… Lady Gaga, whose latest dance-pop album, Mayhem, debuted in March. The genre also made a comeback in the form of Madame Gaga’s artistic descendants, like Chappell Roan and Charli XCX. 

And it wasn’t just the musician’s nachos that were being reheated. 

The last theory to be discussed in our roundup of recession indicators is the Men’s Underwear Index – a weirder (but nonetheless valid) measure which entails that men are more likely to put off buying new undergarments in a fiscally restrictive environment, i.e., hold onto their older underwear. In due form, male undergarment revenues dropped during both the Great Recession and the 2020 pandemic – as they’re seen as “non-essential purchases”. 

But this trend of playing it safe with past hits (not just past underwear) extends further, to the fashion runways where archival revivals are rife, from the newly-brought back Chloé Paddington and Fendi Spy bags to Dior’s J’Adore Dior tees and Alexander McQueen’s skull scarf that all peaked right before the Great Recession (and signal to an overall happier time in our past).

Even the celebrity starlets and style cognoscenti have taken to referencing and rehashing – Vogue’s March 2025 cover featuring Sabrina Carpenter, for instance, references Madonna who famously referenced Marilyn Monroe who, in turn, referenced Jean Harlow. “I give it two more years or red carpets before the girlies completely run out of looks to reference,” tweeted writer, editor, and the host of The New Garde podcast Alyssa Vingan.

Now, are all of these necessarily indicators of an upcoming recession? 

After all, correlation does not necessarily equal causation, and there definitely are better economic indicators than whether those much-memeified peplum tops and skinny jeans are the trend du jour. Yet, they reflect the general consensus among the populace, and whether by correlation or causation, they become self-fulfilling prophecies on their own!

After all, it’s much more fun to tag a Fendi Monster charm onto your purse than track some boring financial metric.