Circular fashion: recycling clothes is worthwhile and could unlock over $50 billion.

In 2024, the world produced approximately 120 million tons of textile waste , equivalent to over 200 Olympic stadiums full of discarded clothing . This figure speaks to much more than an environmental and waste management crisis: it also speaks to a missed economic opportunity. According to a new study by Boston Consulting Group (BCG), Spinning Textile Waste into Value , approximately 80% of discarded garments still end up in landfill or are incinerated, while less than 1% is actually recycled into new fibers. The result is an annual waste of raw materials worth $150 billion . Yet, increasing textile recycling beyond 30% would mean unlocking up to $50 billion in new value and approximately 180,000 jobs .

Numbers that speak volumes about the urgent need for transformation in the fashion sector, which has always been synonymous with creativity, style, and innovation and is now faced with the most pressing challenge yet: sustainability .

"The study highlights a thought-provoking fact: today, only 7% of global textile waste is available as raw material for textile-to-textile recycling (i.e., for processes that transform textile waste into new fibers ready to be reintroduced into the supply chain). The rest is lost in landfills and incinerators. This problem calls for the need to develop new large-scale industrial and technological solutions," says Beatrice Lemucchi , Managing Director and Partner of BCG.

Lemucchi also points out that the timing is more perfect than ever: regulatory pressure is accelerating in Europe with the introduction of extended producer responsibility, approved last week by the European Parliament . "It's not just about complying with more stringent rules, but about seizing a strategic opportunity to strengthen competitiveness and transform waste into a resource," says the Managing Director.

In the face of a crisis that intertwines the environment, economy, and consumption, something is moving today. The European Union has included textiles among the five product categories with the greatest climate impact and introduced Extended Producer Responsibility (EPR) , which requires brands to finance the collection and recycling of garments in the markets where they operate. This approach is being followed by the United States, Canada, and Chile, which are poised to adopt similar measures.

And companies in the sector are also starting to react. Global brands like Adidas, New Balance, and Puma have begun concrete investments in textile-to-textile recycling, a circular approach that is set to gain traction, especially given projections that by 2030, demand for recycled fabrics will exceed supply by 30-40 million tons.

Over the past twenty-five years, global fiber production has more than doubled, driven by rising incomes, changing consumer habits, and trends encouraging frequent purchases over reduced garment use. The result is a system that generates waste at an unprecedented rate, with an increasingly difficult environmental impact to ignore: the textile supply chain, from raw material extraction to production, is responsible for 92% of the entire fashion industry's greenhouse gas emissions. Making the situation even more serious is the problem of waste disposal. Burning just one ton of textiles is equivalent, in terms of emissions, to six return flights between London and New York; sending it to a landfill is equivalent to a whopping eight. Meanwhile, mountains of used clothing grow in every corner of the world. One of the most iconic images comes from the Atacama Desert in Chile, where 66,000 tons of discarded clothing form a landfill so vast it can be seen from space.

The road to circularity remains complex . Recycled materials remain less cost-competitive: recycled polyester can cost more than double that of virgin polyester. Existing infrastructure is also currently inadequate: collection is designed for resale, and manual sorting systems cannot effectively distinguish different fabrics or remove accessories like buttons and zippers. Finally, the complexity of modern materials, often composed of mixed natural and synthetic fibers, presents a challenge that current industrial technologies cannot handle on a large scale. While recovering all the value lost due to textile waste is unrealistic, there is an opportunity to recover a significant portion.

To achieve this vision, the industry should focus on five key actions .

1. Stimulate demand for recycled fibers, with major brands leading the way by promoting large-scale adoption, while small and medium-sized businesses can collaborate, sharing financial tools to address the initial costs of the transition;
2. Increase the amount of waste collected by strengthening existing systems through public and private initiatives. For example, in Europe, this effort could increase collection rates from 30% to 55% by 2033;
3. Modernize sorting, thanks to advanced technologies that automate and speed up processes, with the potential to increase capacity by up to 90%.
4. Scale recycling solutions by investing in infrastructure capable of processing different types of fibers, strategically located and supported by sustainable business models;
5. Strongly support technological innovation: While more than $250 million has already been raised for pioneering companies like Circ, Syre, and Infinited Fiber, further investment, including through consortia, is needed to scale these solutions to industrial scale.

Moving to more sustainable processes is possible, and other sectors are demonstrating this. For example, the German deposit system for bottles has achieved a 98% return rate, while in the energy sector, investments and coordinated regulations have reduced the cost of solar energy by 89% in ten years, making it cheaper than coal.

Even in Italy, Italians discard enormous quantities of textile products every year, and a significant portion still ends up in the wrong disposal channels. According to data from the first edition of the Ipsos Observatory conducted on behalf of Erion Textiles, a consortium dedicated to textile companies, in the last twelve months, two in three people (66%) have thrown away clothes , approximately six in ten shoes (57%), and one in two people have thrown away damaged fabrics or rags (51%), for an average of 7.6 items of clothing per person .

The highest volumes are recorded in the North (69% for clothes and 60% for shoes), where residents throw away an average of 8.4 items of clothing compared to 6.4 in the South. The main reasons are wear and tear (53% nationally) and "no longer use" (39%), but among young people, factors related to fashion, unsatisfactory online purchases, or frequent wardrobe changes are increasingly important. Younger people, in particular, represent a paradox: on the one hand, they are more careful about proper disposal , on the other, they are more consumerist and therefore among the largest generators of textile waste.

One of the most evident critical issues in Italy concerns the fate of damaged garments: the majority are still thrown into unsorted waste bins because they are perceived as irrecoverable. This legacy, according to an IPSOS analysis, stems from years of communication focused on reuse, which encouraged people to donate only garments in good condition, reinforcing the idea that broken items cannot be recycled. The result is that today in Italy, shoes (25%), bags and belts (23%), and home textiles (18%) are often disposed of incorrectly, signaling a cultural and informational problem as well as an infrastructural one. According to Luca Campadello, Strategic Development & Innovation Manager at Erion, change therefore begins precisely here: with new recycling technologies , it will be necessary to develop targeted communication strategies capable of changing citizens' perceptions and transforming the idea of ​​damaged textiles from worthless waste to a valuable resource for the circular economy .