The deadly business of the bargain garment industryBy Michelle Tolson May 21, 2014 1:21PM UTC
Vietnam’s foreign factory burnings gripped the news headlines last week as a wave of anti Chinese sentiment was sparked by a Chinese drilling rig’s encroachment in the South China Seas, but it can’t be hard to enrage impoverished factory workers struggling to feed themselves on wages that don’t meet their basic needs.
Similarly, labor activists in Cambodia have been keen to point out the new minimum wage of $100 per month falls short of the bottom end of the living wage of $160 they have been asking for. On Tuesday, May 20, labor activists went to the courthouse in Phnom Penh in support of the remaining 21 imprisoned labor activists, garment workers and bystanders arrested during the violent crackdown on protestors that claimed five workers’ lives in January. Hundreds of supporters gathered calling for their release on Tuesday. The trial continues today as the International Trade Union Confederation published its global rating report, ranking Cambodia as one of the worst countries for labor rights, one rank above the “no rule of law” status awarded to countries like the Ukraine and Syria.
Tola Moeun, head of the Labor for Community Legal Education Center (CLEC) in Cambodia, recently traveled to the US and Europe to campaign for the rights of garment workers. He wrote an open letter to US brands like Wal-Mart and GAP, calling them out on their exploitation.
“The low-cost garment model is a product of inequality – both in the US and in Cambodia,” he wrote.
However those profiting from the low wages disagree. Bruce Rockowitz, CEO for Li & Fung Ltd., the largest sourcing companies for Western brands, told the New York Times last year that, “Consumers have just not been willing to accept higher costs.” The Hong Kong based company has come under fire for its ruthless bargain contracts for brands like Wal-Mart.
Wal-Mart retail workers in the US earn some of the lowest wages in the retail industry, 12.4 percent less than retail outlets overall, according to the Center for Labor Research and Education at University of California, Berkeley. The corporate giant has made headlines for paying workers wages so low they must apply for food stamps. Yet Wal-Mart has resisted calls to raise its wages, saying its appeal is centered on low cost goods for its customers which includes those with low incomes.
However Berkeley’s labor report has shown raising retail workers’ wages at Wal-Mart would not affect consumers much, just $0.46 cents more per shopping trip. The report found if workers in the US were paid a living wage of $12 per hour instead of the minimum wages many have been making, prices would go up just $12.49 a year per customer, according to market research data used to tabulate costs on the average shopper. And this is if the consumer were absorbs the costs 100 percent.
How would these price increases translate for workers in Cambodia and Vietnam earning far less?
Li & Fung has a lot of clout. They source for 100 of the 400 factories registered with the Garment Manufacturers Association of Cambodia and are responsible for 7 percent of the output from factories in Vietnam. The company has temporarily closed their factories in Vietnam for a week due to concerns about the riots.
Three of the five workers killed during Cambodia’s own protests in January had been working for Wal-Mart, said Tola of CLEC.
In his open letter he wrote: “On any given day, we may see workers who have fallen unconscious at work due to lack of food and or sleep; individuals seeking to avoid involuntary 14-hour work days in 40-plus degree heat; women who have been terminated by their employer because they are expecting a child; or workers who are arrested, beaten or shot for trying to start a trade union to change the status quo.”
While labor laws are meant to protect pregnant women from losing their jobs, the prevalence of short term contracts means there are few guarantees.
Melissa Cockroft, a technical advisor on sexual and reproductive health who has supported projects with the Cambodian Prostitutes Union and Marie Stopes International (MSI), says factories are supposed to provide maternal leave, but have shifted to using short term contracts.
According to labor laws, pregnant women are supposed to be given lighter duties and more bathroom breaks at factories. Factories are also supposed to provide child care but Cockroft says she has only seen one factory with child care offered and there were just a few children there. Many women don’t bring their children to work as it is unsafe to transport them.
She explains while there is a perception that the factories could benefit from supporting family planning services given the concern managers have with pregnant workers, they have been unsupportive of in-house services, possibly because they see this as a form of “monitoring.”
Though family planning services have been offered through simple on-site infirmaries at factories through NGOs like Reproductive Health Association of Cambodia and MSI, it is difficult for workers to make use of them because of their gruelling work schedules and scant breaks.
“No one has really looked at the health situation [for garment workers] in a comprehensive way. For instance, if workers take time off we don’t know if it is because of an STI, pregnancy or whatever, as this is not monitored as garment factory workers are not seen to be ‘high risk’ like other groups such as sex workers. We also tend to think of migrant workers as vulnerable but we are not actually sure as there is a lack of up to date data,” said Cockroft.
Tola explains pregnant workers are getting abortions as they fear losing their positions at the factories.
Cockroft adds: “Abortion is legal but there is concern about the use of over the counter Chinese products, which can be lethal.”
In the US the manufacturing industry eventually became a place for higher wages and benefits for workers without college degrees, but these jobs have seen a decline over the past two decades and been replaced by outsourcing overseas and temporary workers.
Economic Policy Institute reports minimum wage earners in the US represent 30 million workers, taking into account workers in states with a higher minimum wage than the federal wage. One third of these workers are over 40 years old and has “some college education,” showing they are not just high school students earning “extra money” that are living on low wages. Pew Research reports there are 75.3 million hourly-paid workers in the US which means low wage earners represent 40 percent of the hourly work force.
Working class workers in the US have lost benefits and living wages; while those in SE Asia do not seem to have gained them. Who is profiting from rock bottom wages? Is it reasonable to blame the consumer when manufacturing jobs in developed countries have shifted production overseas? Perhaps, if unrest were factored into the costs, these wages wouldn’t be so profitable for shareholders, the brands, the sourcing companies or the factories.
This weekend May 25, Workers Information Center, a grassroots group of garment workers, is staging a fashion show, Beautiful Clothes, Ugly Reality, in Phnom Penh to raise awareness for just how low the industry has sunk in its quest for the lowest wages and highest profits.