This is not the first time that Alan Greenspan’s theory of men’s underpants sales – as an economic indicator in general and predictor of tough times in particular – has entered the public discourse.
The theory holds that men’s underpants sales are generally pretty stable – or inelastic, if you like – because underwear are a constant need but one that doesn’t require constant replacement because they are generally not on display, or at least not on public display. But in times of economic downturn (or even uncertainty) men will delay underpants purchases – although probably not quite as long as suggested in many sitcom jokes.
We probably won’t know if Greenspan’s underpants index will prove to be correct about economic conditions in the COVID and (maybe?) post-COVID eras for a little while yet, as the data are rather fragmentary and inconclusive. However, a look at Hanes’ performance in 2019, 2020, and 2021 gives us a few hints.
Sales in Hanes’ relevant business segment, Innerwear, were better in 2021 than in 2020. However, the picture is muddled by the fact that other kinds of apparel are included in the segment, and that for at least some of that period, Hanes’ PPE business was also included. And it’s pretty safe to assume that 2020 PPE sales were atypical.
The conventional wisdom holds that consumer spending has veered away from travel, dining, and entertainment outside the home and toward furniture purchases, home improvements, upgrading outdoor living areas, and spoiling our pets. This trend favoring greater spending levels in the domestic sphere might include increased spending on underpants – even if such spending wasn’t as obvious. After all, a key difference between old office apparel and new WFH apparel is comfort. Even if you haven’t just stayed in your pajamas for two years, chances are you look more like you’re ready for a physical therapy appointment than for dazzling a prospective client in a conference room (even if you’re trying to stay Zoom-presentable).
So maybe Greenspan’s Iron Law of Underpants isn’t quite as applicable as it might have been, even as recently as the recession 15 years ago. Mr. Greenspan is in his 90s and is probably set in his ways. You know, underpantswise. But the underpants universe for men has expanded greatly.
In the 1981 comedy Stripes, Bill Murray’s character begins basic training and is asked to choose between the underpants options men had for decades: “boxer or Jockey (briefs)?” Murray requests an option that’s not part of standard military issue, showing he was a bit of a visionary. The world of choices has opened up for men since that scene was filmed and Greenspan first articulated his Underpants thesis. Drew Magary has a thorough, amusing (albeit
indelicate rather profane) first person glance at this Brave New Underpants World. Clearly, men’s underpants purchasing behavior has been altered by this new range of options – even if just for the sake of experimentation.
One of Greenspan’s underlying (pun intended!) assumptions is “who cares about underpants?” which suggests that they are an afterthought. But the answer is, “everyone does”. Admittedly, when going to a wedding or funeral, men are more likely to think about which necktie to wear than which pair of underpants they’ll have on under their suits. But that’s partly because the elaborate calculations about format, waistband, length, fabric, fit, and – yes – appearance have already been performed. In some ways, Big Underpants has responded to this complexity by offering underpants in varying lengths, fabrics, colors, and suitability for activities ranging from strenuous athletic activity to doing absolutely nothing. They haven’t quite mastered all this diversity just yet, though…multipacks always seem to contain at least one pair whose color is ill-advised.
Although Freedonia hasn’t been as squarely focused on men’s underpants as the former Chairman of the Board of Governors of the Federal Reserve, we’ve covered them in such reports as Apparel: United States and Men’s Clothing: United States. Additionally, we include discussions of how COVID-19 and potential economic downturns affect industries in every study we publish. You can feel a level of comfort with our coverage that…well, you get the idea.