This would work, but maybe at the expense of realism.
To extend your idea...
If you did want to retain as much as you could about the clothes they usually wear, you could work out the total cost of everything they normal wear, and the armour protection, and make "Goblin Clothing" according to those values. It'd be like having a private bin for the personal effects of each goblin that died, except you couldn't melt the meltable items and selectively burn the non-silk items and so on.
Well I modded my goblins to wearing nothing but Rope Weed clothing. Also, their "leather" armor is also made from rope weed. The snatchers and theives wear -Rope Weed Leggings- and 'Rope Weed Armor'.
Story-wise I suppose the goblins EAT the skins of animals and they fabricate 'armor' by gluing sheets of cloth together into hardened cloth armor, laminated or quilted armor, I guess.
So, they still have armor like they did, its just that everything they wear besides their iron armor is easily catalogued and tracked within my stocks menu.
The "jumpsuit" idea got me thinking that maybe EVERY civ should just have a multi-location set of clothing, rather then needing to track every single last sock a goblin or dorf or elf or humie dies wearing.