Potential Title: Impending Threat: Wage Protests in Bangladesh Pose Risk to Leading Fashion Brands
Bangladesh is witnessing widespread violent protests as thousands of garment workers demand improved wages This has raised concerns for top fashion brands sourcing from the country
Bangladesh has witnessed two weeks of intense protests, with garment workers rallying for improved wages for the country's four million workforce. The demonstrations have escalated into violent clashes between protesters and the police, leading to the unfortunate loss of three lives. Unions have accused the police of employing tear gas and rubber bullets, further exacerbating the hostility surrounding the protests.
"It is escalating into increasingly violent conditions," stated Christina Hajagos-Clausen, the Textile and Garment Industry Director at IndustriALL Global Union, the organization to which the unions in Bangladesh are affiliated.
The country's wage board recently declared a raise of $113 per month for garment workers, scheduled to be implemented on December 1. However, this decision has been rejected by workers and labor groups who argue that wages have failed to keep up with inflation over the past five years. According to the Bangladesh Bureau of Statistics, inflation reached 9% between 2022 and 2023, the highest average rate in 12 years.
Garment workers in Bangladesh currently earn $95 a month while producing clothes for popular brands like H&M, Zara, and Levis. These workers are now demanding a monthly wage of $208. However, it is important to note that even if their demand is met, it would still be lower than the weekly earnings of American workers who make the federal minimum wage of $7.25 per hour before taxes. This wage disparity is strongly criticized by many labor groups in the US, who argue that it perpetuates poverty.
Narza Akter, the President of the Sommilito Garments Sramik Federation, one of Bangladesh's largest unions, expressed her disappointment with the current minimum wage. She stated, "It is unacceptable that the boards' announcement of the minimum wage has made a mockery of the garment industry workers. This decision lacks logic. If the minimum wage is not set reasonably, it may lead to ongoing labor unrest, which is detrimental to the workers, employers, and the state."
Protests have led to the closure of numerous factories in the country, causing the world's second-largest garment manufacturing hub to come to a standstill, second only to China. Many protesters have been treated in hospitals due to injuries sustained during the demonstrations. Tragically, a factory was set on fire by a protester, resulting in the death of a 32-year-old worker named Imran Hossain. Additionally, clashes with the police led to the death of Rasel Howlader, a 26-year-old individual. These incidents have been confirmed by the US State Department.
Regarding these events, Matthew Miller, a spokesperson for the State Department, expressed concern over the continued repression of workers and trade unionists. He called for the tripartite process to reconsider the decision on the minimum wage, ensuring that it adequately addresses the increasing economic pressures faced by workers and their families.
The garment industry in the country employs some of the most impoverished and vulnerable individuals. The working conditions in Southeast Asia's garment industry have faced scrutiny in the past, but Bangladesh has not witnessed protests of such magnitude since the tragic Rana Plaza collapse a decade ago. This nine-story building was densely packed with garment factories and claimed the lives of around 1,100 people, predominantly women.
Although there have been some improvements in conditions and modest wage hikes, they have significantly lagged behind the remarkable growth in the garment industry's value. According to McKinsey, clothing exports from Bangladesh, which aims to achieve middle-income status by 2031, surged from $14.6 billion in 2011 to $33.1 billion in 2019.
What brands are saying
The ready-made garment industry is the dominant sector in Bangladesh's industrial landscape, contributing 35.1% to the country's annual gross domestic product, as stated by the US Commerce Department.
Eighteen renowned brands, including H&M, Levis, Gap, Puma, and Abercrombie & Fitch, recently addressed a letter to the Prime Minister of Bangladesh. Their objective was to emphasize the importance of peaceful negotiations and advocate for a new minimum wage that adequately covers the basic needs of workers. The American Apparel and Footwear Association (AAFP), representing US brands, proposed a more frequent review of the minimum wage. Presently, Bangladesh only conducts this review every five years.
According to Nate Herman, Senior Vice President of Policy at AAFP, "It would be ideal for this wage level, which serves as the basis for calculating all other wage levels in Bangladesh, to be assessed annually rather than every five years. Prompt reviews and necessary increases in these levels are crucial aspects of the improved purchasing practices that responsible brands are adopting."
Instead of owning factories in Bangladesh, brands like H&M collaborate with factory owners there who bear the expenses for supplies, facilities, and labor. H&M acknowledges its responsibility to ensure the payment of living wages through ethical purchasing practices in Bangladesh. Despite the ongoing protests leading to the closure of some factories, H&M believes it will not significantly affect its production or supply chain.
CNN sought clarification from H&M regarding the company's involvement in ensuring fair wages for workers, but no response was received.
Patagonia expressed its support for the workers' demand of a minimum wage of $208 per month.
"We have a single longstanding factory partner in Bangladesh that manufactures our most advanced products. The supplier has made significant strides in achieving fair wages, but we recognize that there is room for further improvement," stated the company this month.
In a separate statement, Levi Strauss & Co expressed its support for the establishment of a fair and transparent method for setting regular minimum wages by the Government of Bangladesh.
Brands lack the authority to determine wages in Bangladesh. However, they possess the ability to exert pricing pressure. CNN attempted to contact the Bangladesh Garment Manufacturers and Exporters Association, representing factory owners, for a response but did not receive a reply.
According to Elizabeth Cline, a Fashion Policy lecturer at Columbia University, brands and retailers play a significant role in pressuring factories. She argues that addressing the issue of wages requires resolving the problem of pricing within the fashion industry.
Consumer responsibility
The majority of the clothing produced in Bangladesh is primarily consumed by customers residing in foreign countries. The World Bank reports that in 2019, the export of garments constituted 84% of the total earnings from exports for Bangladesh.
Consumers' desire for quick and affordable products is growing, with the younger generation showing concern for the origin and manufacturing process of their clothing. However, Jason Judd, Director of the Global Labor Institute at Cornell University, states that the industry cannot rely on consumers to advocate for higher wages. According to Judd, significant customer pressure is necessary for brands to initiate any changes.
During the pandemic, global brands canceled orders totaling $40 billion at factories worldwide, which resulted in factory owners and suppliers bearing the financial burden and workers being left without wages. However, a grassroots labor movement called the "Pay Up" campaign achieved significant success in compelling brands to repay $22 billion of the outstanding $40 billion, as reported by the Workers Rights Consortium.
Nevertheless, true transformative change, according to Judd, is derived from policy reforms and internal changes within each country. Multiple labor activists, interviewed by CNN, draw parallels between the current situation in Bangladesh and the events that unfolded in Cambodia back in 2014. During that time, garment workers in Cambodia sought higher wages in response to the government's implementation of a new minimum wage.
In response to the protests, the government deployed security forces who fatally shot at least three individuals. However, this event prompted reform, leading to Cambodia's annual increase of the minimum wage for garment workers. According to Judd, Bangladesh should strive for a more rational, non-violent, and inclusive approach, as this has been successfully implemented in the past without the need to start from scratch.
