A TF investigation of South Asia’s garment industry chronicles
globalization’s race to the bottom
Each day, 20-year-old Farida leaves her home in the slums of Dhaka, Bangladesh’s capital (population 13 million), and walks an hour to her job at the Dalia Garment Factory. She works from 8 a.m. to 8 p.m., sometimes as much as two hours more, and often seven days a week. Like many garment workers interviewed for this article, she didn’t want her real name used for fear of losing her job. For her labor, the young worker earns the equivalent of about $18 per month. At night, she must walk through the pitch black and dangerous streets of a city notorious for its crime rate.
For 32-year-old Narayan, the walk to the Krishna Garment Factory in Kathmandu, Nepal, is shorter. But she must stand all day, 48 hours per week, and doesn’t always get paid on time. “A month or two sometimes will go by,” she explained. “I want my employer to follow the law and pay me on time.” Narayan has worked at the factory for 14 years.
Thirty-year-old Bathra Kumari toils on the production line at Martin Imprix Factory in the Free Trade Zone on the outskirts of Colombo, Sri Lanka’s capital. With overtime, she can earn about $28 per month. At night, she walks 45 to 50 minutes to get to her boarding house, where she shares a 10 by 12 foot room with three other women. There are three toilets for the 30 workers who stay there, a shortage of water, and often no electricity.
These workers are among the thousands of women employed in South Asia’s ready-made garment (RMG) industry, the quintessential example of globalization’s false promise of prosperity. Their stories document a harsh reality: Although garment workers make the brand-name clothing and apparel many of us buy, compared to the profits reaped by factory owners and buyers, the vast majority barely scratch out a living, earning poverty level wages and working in substandard and unregulated conditions.
The World Bank defines extreme poverty as US $1 a day, but this TF investigation, which included interviews with more than 30 women, found that few workers in South Asia’s RMG industry earn that amount. “The competition among factory workers within South Asia and among other garment-producing regions has created the proverbial race to the bottom whose effects are not hard to identify,” explained Ashwini Sukthankar, director of research and investigations for the Washington, DC-based Workers Rights Consortium. The labor organization monitors standards at factories producing apparel that bear the names and logos of 112 colleges and universities in the US.
Winners and Losers
The RMG industry is vital to the growth of South Asian economies. Indeed, it’s the biggest foreign exchange earner for most of them. In Bangladesh, for instance, the total RGM industry share is 76 percent, while for India and Sri Lanka, the figure is 45 and 54 percent respectively. “The garment sector is not only Bangladesh’s biggest foreign exchange earner, it has played a key role in our development efforts,” explained S.M. Nurul Hoque, acting president of the Dhaka-based Bangladesh Garment Manufacturers and Exporters Association.
Big-time buyers like GAP, J.C. Penney, Levi Strauss, Disney, and Wal-Mart, among others, have been attracted with promises of cheap labor and tax breaks. At the top of the RMG industry ladder, they place orders with brand name manufacturers, who, in turn, use contractors in the local country to assemble the garments. The contractors recruit, hire, and pay the workers on the bottom rung. Competitive bidding drives contract prices so low that it apparently becomes difficult to pay the minimum wage or overtime.
“Most contractors are put in a take it or leave it position and must accept whatever low price the manufacturers give them or see the work placed in another garment factory, either somewhere else in the country or abroad,” explained Nikki Fortunato Bas, co-director of Sweatshop Watch. “The contractors must sweat their profits out of their workers, cut corners and operate unsafe workplaces.” Sweatshop Watch is an Oakland, California-based labor coalition committed to eliminating sweat shop exploitation in the US and globally.
Most of the workers who have made the RGM industry a success are young women between the ages of 20 and 29, who have left their villages in rural areas to seek a better life or escape from abusive environments. During the industry’s formative period, from 1980 to 1995, its female employment rose from 17 to 69 percent in Bangladesh, and from 23 to 49 percent in India. Even Nepal, which has a lower share of female employment than other countries in the region, saw a significant rise.
Advocates say that the factory owners prefer to hire young women, believing that they can more easily be manipulated or intimidated, and will be less likely to fight for their rights. “By hiring mainly young, inexperienced women from the rural regions, factory owners have been able to keep the wages in the industry at a ridiculously low level,” charged Mojibur Rahman Pintu, joint secretary of Bangladesh’s Dhaka-based National Garment Workers FederationÔs Central Committee.
Nevertheless, the industry has led to radical change in the lives of thousands of poor women. Many of those interviewed for this article said finding work in garment factories has given them the opportunity to be independent, earn a steady income, get out of the house, and become something other than domestic helpers.
At the Women’s Worker Hotel in central Dhaka, several young workers talked about their new lives. Housing 300 female workers, it is operated by Nari Uddug Kendra (NUK, the Center for Women Initiatives). Rosi, a 25-year-old worker, proudly revealed that she sends half of her monthly income ($38) to her family in the Comilla District, about a two-hour drive from Dhaka. Rosi, who often must work 12 hours a day, six to seven days a week, said it’s worth the sacrifice because she can bank half her salary.
“The money the women garment workers earn may seem like a small amount to us, but they come from such poor backgrounds that nobody in their families had seen the kind of money they’re making,” explained Mashuda Shefali, NUK’s executive director.
On the surface, it looks like the industry’s effect on women workers has been somewhat positive. But let’s put the situation in perspective. Research by the New York-based National Labor Committee reveals that some Bangladesh garment workers have been earning the equivalent of 1.6 cents for each baseball cap they make in garment factories. The caps sell for about $20 in the US. Facts like these make it hard to understand why garment workers should be receiving sub-poverty level wages.
And they have grievances besides wages: late payment, dangerous and unhealthy working conditions, forced overtime, lack of housing and transportation facilities, and no job security, health benefits, or on-site medical services, for starters. In Bangladesh, the lack of fire safety codes has led to tragedy. From 1990 to 2002, 252 garment workers died and several thousand more were injured in 54 fires at various garment factories.
“No standards exist in the garment industry, that’s the problem,” Pintu said. “Some workers will end up working in a factory where pay and working conditions are relatively not bad. Others may get hired by factories that have unacceptable conditions in every way.”
Ironically, South Asian countries have plenty of laws on the books to protect workers from such abuses. In addition, the factories have established codes of conduct, which roughly resemble each other and reflect internationally recognized labor standards. Yet, activists complain that the industry isn’t serious about upholding the codes or enforcing laws that protect the right to unionize and bargain collectively. The region’s governments are simply too nervous about upsetting the globalization cart.
In Nepal, where only 17 percent of workers are unionized, the government amended the Industrial Disputes Act in December 1999, requiring unions in a workplace if 40 percent or more of the workers belong to the union. But this hasn’t led to the growth of unions, even though many workers want them. “There is no safety net for Nepal’s garment workers, but through collectively bargaining, unions can help improve labor conditions,” explained Indra Bilas, an official with General Federation of Nepalese Trade Unions, based in Kathmandu.
The 40 percent rule also applies in Sri Lanka. But consider the workers at the Jaqalanka Factory in the Katunayake Free Trade Zone, which produces apparel for VF Corporation, one of the US’s largest garment companies. They sought a vote to determine if the workers wanted a union, which would then be recognized as a collective bargaining agent. Leading up to the ballot, they faced threats, intimidation, and harassment from management. Only 17 workers participated when the vote was held July 9, 2003.
Last July, five workers from a factory on the outskirts of Dhaka were fired after management got wind of their efforts to form a union. The next day, the workers met with Robert Wayss, field representative in Bangladesh for the American Center for International Labor Solidarity, to discuss how to get their jobs back. “This is typical of the labor situation in Bangladesh,” Wayss explained. “The five workers were part of a committee in the factory organized to form a union, and management found out about it. The workers are told that there is no more work for them. ÔSorry,’ says management, Ôbut we have to lay you off.’ It’s illegal in Bangladesh to be fired for union organizing activities, but the onus is on the workers to prove it.” The five are planning legal action, but in an interview for this report, they didn’t sound optimistic about their chances.
The pace of the race to the bottom will quicken in 2005 with the phaseout of the Multi Fiber Agreement (MFA). As a result, Nepal, Bangladesh, and Sri Lanka will likely lose much of their guaranteed market access, which has helped sustain them in the highly competitive global RMG industry.
“The women whose labor built this industry will be the ones to pay the price for the change,” Shefali said. NUK delivers basic health care services to workers in 100 garment factories in Dhaka. But five factories have closed, two more are in trouble, and 31,609 employees, including 23,107 women, are out of work.
Forty-five-year-old Shahnaz worked 24 years for a garment manufacturer in Dhaka until last Spring, when her employer closed its doors. She received no severance pay and was forced to move in with her family, struggling to survive and find work. Shahnaz says she is too old to find another job in the RGM industry and doubts she will find work that pays as well – about $26 a month. In Bangladesh, like other South Asian countries, no government programs are in place to retrain workers and help them find work.
The MFA phaseout will lead to major restructuring of the global garment industry, allowing retailers and manufacturers to operate in any country without restriction. South Asia garment workers won’t be the only losers. In California, experts predict that half the state’s garment workers will lose their jobs, leaving up to 350,000 immigrants unemployed.
Activists charge that the multinationals buying these garments – the GAPs, Wal-Marts, J.C. Penney’s, and so on – must assume responsibility to ensure decent labor conditions. After all, they have the most influence. Activists have talked with buyers, who say they are eager to help, but haven’t followed through. “We haven’t had any buyers come to us and say, ÔHow can we help you’,” explained Shenghi Lee of the International Labor Organization’s Dhaka-based office.
“With enough consumer pressure, the corporations may realize that labor conditions must have as much importance in their buying decisions as cost and quality,” Bas added. “Consumers and activists in the US must also support the continuing struggle of garment workers in the global south as they organize and demand accountability from the corporations.”
The Workers Rights Consortium provides factory assessments, reports, a searchable database, and links to other labor rights organizations at www.workersrights.org. Find out about Sweatshop Watch and its coalition work with labor, community, civil rights, immigrant rights, women’s, religious, and student organizations to eliminate exploitation at www.sweatshopwatch.org. The National Labor Committee puts a human face on the global economy at www.nlcnet.org, and organizes campaigns aimed at corporations such as the Gap, Liz Claiborne, Kathie Lee Gifford/Wal-Mart, and the Walt Disney Company. The Solidarity Center, launched by the AFL-CIO, assists workers around the world who are struggling to build democratic and independent trade unions; go to www.solidaritycenter.org.