The Underwear Indicator: How eCommerce Sales Analysis Might Signal Recession

 In Blog

I am not an economist. Let me state that right off the bat. I am also not a fortune teller or a bettor on the market. But concern about a recession in the economy is relatively high at the moment. One measure that gets a lot of attention is the spread between the interest rates on treasury securities with short-term and long-term yields. Still more are slightly less encouraging jobs reports, market indexes that may be sensitive to increasing trade conflicts. But in my uninformed opinion, the real numbers we should be looking at it is the strength of the online underwear market. For real.

For those of you still reading, let me present my case.

Consumer spending is still a huge contributor—perhaps THE major contributor to the economy at large. According to the U.S. Bureau of Economic Analysis, personal consumption expenditures accounted for around 68% of GDP in Q1 2019. That number isn’t quite as high as it once was, but it’s still a major force.

So any reduction in consumer activity could be an indicator of recession. And underwear is, so the thinking goes, a particularly good category of purchase to consider. It’s a necessity (almost everyone wears it every day) but its functionality prevents it from being a “luxury,” though what exactly constitutes a luxury varies according to individual tastes. 

The nature of underwear also means it’s an article of clothing invisible to most people. So when money is tight consumers are less likely to feel inclined to replace the worn out pairs. Taken as a whole, aggregate retail trends for categories like this can be a sign of the health of the economy at large. Alan Greenspan was a fan of this metric, along with the health of dry-cleaning shops. The thinking is the same—if times are bad, this is a purchase people only make when they absolutely have to. 

Now that more and more retail activity is moving online (more than 10% of all sales according to the Dept of Commerce), we can take a quick look at retail trends through Jumpshot’s Insights tool. And in the last three months, growth in men’s underwear transactions has fallen off substantially. Starting in May, transactions are lower than they were in 2018. This comes after 2018 saw higher volumes across the board.  

So that’s not a good sign. But maybe a negative eCommerce growth rate in underwear sales isn’t particularly useful. Maybe online underwear buyers are all searching for fancy brands instead of buying the basics. After all, the metric is supposed to measure something stable. 

At large though, data from eCommerce sales indicates that most people are buying the basics. The leading four brands in the category alone—Hanes, Fruit of the Loom, Duluth Trading, and Jockey, account for almost half of the eCommerce market share for the category.

BrandsNo. of TransactionsShare
Fruit of the Loom2,009,91111.9%
Duluth Trading1,952,20711.5%
Calvin Klein718,0894.2%
David Archy311,1791.8%


When people refer to the underwear index, it’s usually men’s underwear sales they’re referencing. Why? Because most economists seem to picture a man who is willing to live with an embarrassing level of squalor (this author is not included) and thus more willing to forgo purchase a necessity. That image feels more than a little outdated, so I analyzed at women’s underwear sales too. Lately, fashion trendspotters have reported comfort-forward, high-waisted underwear ( so-called “granny panties”) is making a comeback among women, putting it in the “necessity” category and more reasonable as an object to study as an economic indicator.

If anything, sales in the panties category show a very similar trend, except totals are down even more significantly than they are for Men’s Underwear. Starting in September 2018 transaction volumes have shown year-over-year declines every month (except for in February and March 2019, where they just barely edged out 2018 numbers).

Here though, a huge part of that decline seems to be about a decrease from just one retailer—Victoria’s Secret. Once the leader in the category, has fallen to second place behind in terms of pure transaction volumes. (That decline should probably have qualified it for inclusion in our 2018 Retail Winners, Losers and Amazon Data Report.)  In the past, Victoria’s Secret would have been in second place on any given day even back in 2017, but saw huge spikes in sales around November and December as buyers purchased in the holiday shopping season.

In 2018, holiday transactions on were far far below 2017 levels, and generally, the site has seen declines persist. has held steady in the meantime, and sites like,, and have all seen their numbers rise.

So perhaps using women’s underwear as an economic indicator is still problematic. LBrands, who owns Victoria’s Secret, has seen its stock price steadily fall over the last 4 years, and ratings for its annual fashion show plummet. But no single major player has emerged to take advantage of their decline and the category as a whole is slipping as a result. It could be that Victoria’s Secret purchases were very discretionary. As women (and men) have stopped purchasing it, they didn’t feel the need to replace with products from other retailers. Either way, the underwear indicator seems to be in decline, at least online, for both genders. Time will tell whether this analysis will prove prescient or not. I suspect though that looking at tracking eCommerce sales trends will become more and more vital to understand the economy as a whole. Equally so, understanding how to put tools like Insights to use is becoming vital to research retail growth and gain competitive intelligence within any category, anywhere products like yours are sold online. Start a free trial today for 14 days to unveil consumer behavior.

Recent Posts