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Fashion
Victims:
Together we can clean up the clothes trade
The Asian garment industry and globalisation
Duncan Green
The author would like to thank the following for their help in producing
this report. For their support and original research in the Philippines,
Fides Moraleda and all the staff of Urban Missionaries; in Sri Lanka, the
team at PEFDA; in Thailand, Rakawin Leechanavanichpan; in Indonesia, Imma
Mardani and the staff of Caritas; in Bangladesh, Azam Khan and Shafiul Azam
of Caritas, as well as Amirul Haque Amin and Rosaline Costa; for additional
research, Helen Fox and Lucy Ackroyd; for comments on the text, and statistical
and other information, Adam Mansell, Matilda Quiney, Neil Kearney, Dr GL
Godwin, the Clean Clothes Campaign, and George Tarvit.
Above all, I would like to thank the many garment workers and their families
in several countries who gave selflessly of their time and hospitality.
CAFOD 1998
First published November 1998
Written by Duncan Green
Edited by Linda Jones
© CAFOD
Published by CAFOD
Romero Close
Stockwell Road
London SW9 9TY
Tel: 0171 733 7900
Fax: 0171 274 9630
Internet: http://www.cafod.org.uk/cafod/
Please send comments and corrections to dgreen@cafod.org.uk
Introduction
"The Church insists that an employed person is a full human being,
not a commodity to be bought and sold according to market requirements.
Workers have rights which Catholic teaching has consistently maintained
are superior to those of capital. These include the right to decent work,
to just wages, to security of employment, to adequate rest and holidays,
to limitation of hours of work, to health and safety measures, to non-discrimination,
to form and join trade unions, and, as a last resort, to go on strike."
The Common Good, statement by the Catholic Bishops' Conference of
England and Wales, 1996.
CAFOD is the official aid and development agency of the Catholic Church
in England and Wales. It works through local partner organisations in 75
countries to promote human development, regardless of race or creed. It
also campaigns in England and Wales to tackle the causes of poverty.
The Fashion Victims action is part of CAFOD's millennium campaign,
Fair Deal for the Poor. This resulted from consultation with partners
in Africa, Asia and Latin America. They drew attention to the impact of
globalisation - the increased speed and ease with which information, goods
and money can be moved around the world - on the lives of the poor people
with whom they work.
This report looks at the impact of globalisation on the lives of garment
workers in Asia. Urban Missionaries, a CAFOD partner in the Philippines,
carried out research on the increasing use of temporary contracts in the
garment industry. In Sri Lanka, People's Forum for Development Alternatives
(PEFDA) interviewed workers in the Kandy and Kurunegala areas. Research
into the industry in China was carried out by Asia Monitor Resource Center
(AMRC). Further research was carried out by CAFOD's UK-based staff.
The Fair Deal for the Poor campaign calls for an improvement in working
conditions in third world export industries, through the introduction of
voluntary, independently verified codes of conduct for all UK companies
trading with third world suppliers. CAFOD is NOT calling for boycotts. For
workers in third world countries any job is better than no job. Garment
retailers should not cut off suppliers as this will lead to mass redundancies.
CAFOD asks retailers to work with suppliers and consumers to improve conditions.
Together we can clean up the clothes trade.
Contents
6 Executive Summary
7 A1. Rags
and riches: UK clothes retailers
7 Retail prices and consumer
spending in UK
8 Box: market leader - Marks
and Spencer
8 Table: garment retailers
by market share
9 A2. Worn
out? UK clothes industry
9 Current state of UK
clothes industry, impact of globalisation
9 Trading places: UK imports
and exports
9 Key points
10 B1. Garments,
globalisation and development
10 Boom or bust: restructuring
the garment industry
10 Labour costs
10 Table: How cheap is cheap?
Hourly wages
11 Trade liberalisation
11 Box: Multi Fibre Arrangement
12 Export drives
12 Communications
12 Proximity to major markets
12 B2. Responses
to globalisation
13 Move upmarket
13 Cut costs
13 Relocation
14 Subcontracting
14 Homeworking
15 B3. Trading
places: rise of the Asian garment industry
15 Asian Tigers
16 B4. Clothes
to die for: wages and conditions
16 Wages
17 Box: face behind the label
- Dani
17 Hours
17 Abusive treatment
18 Health and safety
18 Intimidation of trade
unions
19 Box: union member suffers
razor attack
20 Short-term contracts:
Philippines case study
20 Box: face behind the label
- Marilou
21 B5. Garments
and development
21 Impact of globalisation
on development
22 Case study: Made in China
24 Blessing or curse: life
for women in the garment industry
25 Box: face behind the label
- Hasina
25 There is an alternative
26 Key points
26 Box: CAFOD and Asian garment
workers
27 C.
Just shopping: supporting garment workers
27 Taking action
27 What are codes of conduct?
28 What's in a code?
28 Ethical Trading Initiative
29 Box: ETI base code
29 Codes: on paper and in
practice
30 Trade unions
30 Ensuring compliance
32 Unanswered questions
34 Third world views and
voices
34 Key Points
36 Analysis of UK Garment
Retailer Codes
42 British retailer codes:
the good, the bad and the inadequate
43 Conclusion
44 Endnotes
47 Appendix A: Table: Imports
to Britain
48 Appendix B: Organisations
active on codes of conduct and the garment industry
51 Appendix C: Further resources
Executive Summary
More than half of the £23 billion-worth of clothes sold in Britain
every year are imported. This proportion will rise still further due to
the process known as globalisation - the growing integration of the world
economy. A large part of Britain's imports comes from Asia, where garment
exports have boomed in recent years. Top of the league is China, the world's
largest exporter.
CAFOD's research in Asia reveals that cut-throat competition between producers
has created a system of Market Darwinism. The prize goes to those countries
with the lowest wages, longest hours and most repressive treatment of their
workforce. As a result, the garment industry is no longer leading to lasting
economic and social development.
Wages in Indonesia and Bangladesh are as little as 35p and 63p a day,
respectively. CAFOD researchers found women in Bangladesh who had not had
a single day off in two months of 13-14 hour shifts. Evidence from countries
such as Vietnam and China suggests routine harassment of workers, involving
physical punishment, humiliation, and fines for minor misdemeanours.
For Asian women, who make up the majority of garment workers, the clothes
industry provides much-needed income and status. But it exacts a high price
in terms of exhaustion and health problems, such as chronic back pain, repetitive
strain injury, dizziness, and deteriorating eyesight. Many workers burn
out within a few years.
Countries with slightly better wage levels have come under intense pressure
to compete by cutting wages, and employing more flexible production methods.
These include the use of subcontracting to small workshops, or switching
the workforce from permanent to short-term contracts, with a heavy toll
in terms of anxiety and insecurity.
Efforts by local workers, non-governmental organisations (NGOs) and trade
unions are the most important factor in trying to improve wages and working
conditions in Asia, and fight the levelling down effect of globalisation.
In Britain, consumers can support these efforts by pressing retailers and
manufacturers to adopt codes of conduct for their third world suppliers.
This pressure works. Garment retailers are rapidly adopting and improving
such codes, but more needs to be done. However good codes look on paper,
they will make no difference unless credible systems of independent monitoring
are set up to ensure compliance.
CAFOD is urging companies to join the new Ethical Trading Initiative (ETI),
which has been established to help them develop such systems.
A1. Rags and riches: UK clothes retailers
The average British woman owns 16 blouses. In the 1940s, she owned two.1
Increasingly, people define themselves through what they buy and what they
wear. Browsing through the racks, hands move from label to label, checking
price, washing instructions and fabric. But even if the label carries the
country of origin - not a legal requirement in Britain - it tells you nothing
about the hands that cut, sewed and packed your latest purchase. Did they
belong to a young Chinese woman living in barrack-like accommodation in
one of the factories on the booming Chinese coast, or to a Bangladeshi woman
struggling to raise a family in Dhaka? Was she trying to form a trade union,
living in fear of the sack, or worse? Was she at the end of her tether,
tormented by backache, her vision blurred after her sixtieth twelve-hour
shift in a row?
Clothes are getting cheaper. The British retail trade is in a permanent
price war and nowhere is more cut-throat than the rag trade. If shops let
clothes prices rise, they see customers move next door to cheaper outlets.
While retail prices in general rose by 50 per cent between 1987 and 1996,
clothing and footwear rose by just 16 per cent. Most competitive of all
is womenswear, where prices rose by less than one per cent in those ten
years. In real terms, i.e. allowing for inflation, prices of women's clothes
have fallen by a third.2
That inexorable downward pressure on prices lies at the heart of globalisation.
It forces retailers to look for ever-cheaper sources of clothes, transmitting
the pressure through their buyers to the manufacturers, who roam the globe
looking for cheaper labour and higher quality and productivity. Ask for
a wage rise in Bangladesh and the boss says the jobs will go to Sri Lanka.
Ask in Sri Lanka, and the answer comes back - the jobs will go to Bangladesh.
In 1996, consumers in Britain spent about £400 per person on clothes;
women spent twice as much as men. Altogether we spent £23 billion,
slightly more than we spent on cars.3
The growth sector of the 1990s has been sportswear; the annual market for
replica football kits is now £150 million.4 Newcastle vice-chairman
Doug Hall is brutally clear about how it works. During a drunken interview
with an undercover News of the World reporter he said, "We sell 600,000
shirts a year. Every shirt costs £50, but the shirts only cost £5
to make in Asia.5
People buy their clothes through many channels, from mail order to glitzy
boutiques. Most clothes are bought from chains of specialist shops such
as Burtons, Next, or Top Shop, followed by variety chains such as Marks
and Spencer and Bhs. Although there are still some 30,000 independent retailers
in the United Kingdom, operating with fewer than five stores per company,
the clothing market is increasingly dominated by the big players.
Although the top seven retailers between them control over 40 per cent of
the UK clothing market, many of their names will be unknown to most shoppers.
Large companies divide their shops into different retail formulas to target
particular age ranges or income brackets. Arcadia Group, for example, owns
Dorothy Perkins, Top Shop, Top Man, Burton Menswear, Hawkshead, Racing Green,
Evans and Principles.
Market leader: Marks and Spencer 6
M&S dominates clothes retailing in Britain. In 1997/8 it sold £4.3bn
of clothing, footwear
and gifts, giving it a 15 per cent share of the UK market. It is perhaps
most associated with underwear, accounting for about 35 per cent of the
UK market. It has also built a reputation for high quality food.
During the 1920s, M&S broke with British retailing tradition by eliminating
wholesalers and buying clothes direct from manufacturers. M&S still buys
most of its clothes from a handful of manufacturers, such as Coats Viyella,
Courtaulds, William Baird and Dewhirst. These compete for orders based on
quality, value and innovation, ensuring competition for the lucrative M&S
contracts. Dewhirst, for example, sells 88 per cent of its goods to M&S.
M&S has had a long and close relationship with these suppliers, working
together to develop new product lines.
While many other high street retailers buy the majority of their clothes
from overseas, M&S still buys British. The company is often credited with
single-handedly ensuring the survival of at least part of the British clothing
industry. In 1997, some 65 per cent of M&S clothes were produced in factories
in the United Kingdom, but over the last 15 years it has worked with its
suppliers to source an increasing percentage from outside, especially from
Asia, Eastern and Southern Europe and North Africa. This involves establishing
relationships with "like-minded factory owners", and working with
them to raise quality and working conditions to M&S standards.
Over the years, M&S has become a byword for reliability and high quality,
giving the firm a unique reputation, which it guards with zeal. In 1998
it was awarded costs and won damages in a libel action against Granada Television
over a World in Action investigation, which alleged that M&S knew of children
being employed in one of its suppliers' factories in Morocco.
Garment retailers by market share
| |
|
|
%
|
£m
|
|
Position
|
Retailer [subsidiaries]
|
|
Share of UK Market
7 (1996)
|
Annual Turnover
(1997)
|
| 1 |
Marks and Spencer |
15 |
|
8,243 |
| 2 |
Arcadia
Group plc |
7.2 |
|
1,399 |
| |
(formerly Burton Group) |
| |
[Dorothy Perkins, Top Shop/Top
Man, |
| |
Burton Menswear, Evans,
Principles, |
| |
Racing Green, Hawkshead] |
| 3 |
Storehouse |
6.5 |
|
1,250 |
| |
[Bhs, Mothercare, Blazer,
|
| |
Children's World] |
| 4 |
C&A |
4.7 |
|
844 |
| 5 |
Next |
3.5 |
|
639 |
| 6 |
Sears |
2.9 |
|
524 |
| |
[Adams, Miss Selfridge,
|
|
|
|
| |
Warehouse, Wallis, Richards] |
|
|
|
| 7 |
River Island |
1.6 |
|
285* |
*1996 figure
Sources : Corporate Intelligence, The Retail Rankings, 1998 edition,
and company annual reports.
A2. Worn out? UK clothes industry
On 30 March 1998 the Companies and Finance section of the Financial Times
carried one of its regular obituaries for the UK clothing industry announcing,
"Dewhirst, the textiles group which supplies garments for Marks and
Spencer, closed its Malton factory in North Yorkshire as part of its restructuring
programme, making 160 staff redundant." Another hard-pressed British
company on the verge of bankruptcy? Far from it. Dewhirst's profit margins
make it the envy of the garment industry. A week later, another article
revealed the background to the layoffs. "The company, which has already
moved 36 per cent of its production overseas, mainly to Morocco and South-East
Asia, said it aimed to increase offshore production to 70 per cent of the
total by 2002."8
Courtauld's, another major Marks and Spencer supplier, proclaimed in its
1997 Annual Report, "In clothing, we are increasing the proportion
of product made in the Mediterranean region and in Asia to achieve more
competitive costs. We now own clothing factories in Morocco, Tunisia, Turkey,
Sri Lanka, the Philippines, Thailand and China."
In the last 25 years, relocation, bankruptcy and the introduction of labour-saving
technology has cut the total number of jobs in the UK clothing and textile
industry from one million to about 370,000. Of these, about 218,000 work
in the clothes industry.9
Beyond this a network of small workshops and homeworkers, whose numbers
are unknown, has boomed. Many of them are grouped around London's East End,
the West Midlands and Greater Manchester, often run by ethnic minorities
such as Asians, Kurds and Turks. Like their counterparts in Asia, workers
in Britain's sweatshops often suffer poor wages, working conditions and
job insecurity.10
Trading Places: UK imports and exports
British clothes imports have almost trebled since 1986 (see table
page 47), the majority of the increase from outside the European Union.
In 1997 the main non-EU sources were Hong Kong and China, (whose economies
are now so inter-linked that they should be treated as a single source),
Turkey, India, Indonesia, Morocco, and Bangladesh. By 1996, import penetration,
the share of UK retail clothes sales accounted for by imports, had risen
to 57 per cent.
British exports have also increased over this period, mainly to the European
Union, but have failed to keep up with the boom in imports, or to compensate
for the job losses incurred in the industry.
Key Points
British consumers spend £23 billion a year on clothes - £400
per person.
The clothes market is dominated by a small number of large retail chains,
led by Marks and
Spencer.
The number of jobs in British clothes factories has fallen rapidly in
recent years, as
companies relocate to cheaper countries.
B1 Garments, globalisation and development
In Bangladesh over a million women now work in a garment industry which
barely existed 15 years ago. The morning rush hour is an amazing sight.
At 7.30am the streets of Dhaka are a silent, Technicolor tide of young
women in vivid saris emerging from the slums and walking to the thousands
of mouldering factories which line the streets of the city. By 9.00am
the streets have become male again. The women remain toiling in the factories
until well into the night.
Boom or bust: restructuring the garment industry
Over the last thirty years, the clothing industry has declined
in almost all first world countries, as garment factories have sprung
up like mushrooms across the developing world. Developing countries doubled
their share of world clothes exports from 30 per cent in the early 1970s
to over 60 per cent by the mid-1990s.11
By the late 1990s, China had become the world leader in clothes exports.
Adding together the exports of China and Hong Kong - which are largely
made up of Chinese-produced garments, re-exported - China exported garments
worth US$47 billion (£28 billion) in 1996, comprising 29 per cent
of world exports. The next largest exporter, Italy, exported just a third
of that amount. Other Asian exporters include Thailand, Indonesia, and
Bangladesh; in Southern and Eastern Europe and North Africa exporters
include Turkey, Poland, Romania, and Tunisia.
A number of factors account for this drastic restructuring of a major
world industry, employing over 7.5 million people worldwide 12.
In a sophisticated modern factory in Bangladesh, CAFOD researchers calculated
the wages earned by the women sewing large quilted Nike ski jackets, based
on figures provided by the management. The total came to 51p per jacket.
A similar jacket on sale in the United Kingdom costs £100. The workers
earn half a per cent of the jacket's retail value.
Labour costs
Clothing production has resisted automation more than many other
industries, as machines have so far failed to match the human hand in
manipulating cloth during the sewing stage. Production remains labour
intensive, and wage levels are crucial in determining the cost of the
final product. The huge disparity in wage levels worldwide is the driving
force behind the globalisation of the garment industry (see table below).
When the hourly wage of a British garment worker is over 20 times that
of a Bangladeshi or Chinese worker, it is easy to see why the price war
works in favour of Asian factories despite differences in productivity.
Furthermore, since many factories are little more than a roof and a few
dozen sewing machines, the start-up costs are small.
How cheap is cheap?
Hourly wages in textile factories
(Spring 1996)
| |
Country |
Hourly wages £ |
| |
USA |
|
6.24 |
| |
UK |
|
6.05 |
| |
Italy |
|
6.01 |
| |
Tunisia |
|
0.92 |
| |
Thailand |
|
0.79 |
| |
Mexico |
|
0.70 |
| |
Turkey |
|
0.66 |
| |
Philippines |
|
0.47 |
| |
Bangladesh |
|
0.28 |
| |
China |
|
0.24 |
| |
Indonesia |
|
0.23 |
Source : Werner International Management Consultants
Note : Although these figures give an idea of the variation of wage
levels between different countries, they are for the associated textile
industry, rather than clothing. While the differentials between countries
are broadly similar for both sectors, CAFOD's research suggests that wage
rates in the garment sector are often significantly lower. For example,
garment workers in Indonesia were receiving 35p a day in February 1998,
and in Bangladesh typical daily wages in July 1998 were 63p for a 12-hour
day.
Trade liberalisation
The last 30 years have seen a decline in the use of tariff barriers
and other obstacles to trade between countries. As a result, countries
are increasingly reliant on trade with the outside world, rather than
producing goods for consumption at home. Aware of the vulnerability of
their local clothing industry, first world countries have been more reluctant
to liberalise their trade in clothes than in almost any other sector.
The garment industry is covered by one of the most systematic and comprehensive
sets of trade restrictions in the world. Nevertheless, such is the competitive
advantage of the low wage countries, that this has failed to prevent the
globalisation of the clothes trade. In recent years, agreement has been
reached to eliminate many of the remaining restrictions. As a result,
globalisation is expected to accelerate still further (see box below).
Multi Fibre Arrangement 13
The Multi Fibre Arrangement (MFA) is a system of quotas designed to protect
garment industries in first world countries by slowing down the pace of
globalisation. This is in order to give their local industries more breathing
space in which to adapt to the influx of cheap-labour garments from Asia
and other third world nations. It was first introduced in 1974 and will
end in 2005.
Under the MFA, member countries are either exporters, such as Bangladesh
or the Philippines, or importers, which include the European Union. Importers
are allowed to agree quotas on imports from the different producer countries.
The MFA does not apply to the expanding garment trade between rich countries.
The MFA has had a complex but crucial impact on the development of the
garment industry. In the Third World, by imposing limits on poor country
exports, it encouraged investors to shop around for new countries. Since
the European Union does not impose quotas on the group of Least Developed
Countries (LDCs), those countries (such as Bangladesh) acquired an advantage
over non-LDCs such as Korea and Hong Kong, and their garment industries
boomed. Korean and Hong Kong producers were forced to move up-market or
relocate to LDCs to survive.
The end of the MFA is expected to have a serious impact on the garment
industry because different countries will be in direct competition. Ending
the quotas on the cheapest producers will allow them to undercut slightly
better off countries. The main beneficiary is expected to be China14,
which will consolidate its dominance of the global garment industry at
the expense of less competitive producers such as the Philippines and
Thailand. This becomes even more likely if China succeeds with its application
to join the World Trade Organisation (WTO), which will help safeguard
it against protectionism in the First World. Bangladesh, which has enjoyed
free access to EU markets, and during the 1980s became Europe's biggest
supplier of shirts and T-shirts, is likely to lose. Once quotas are removed,
it will suffer from its poorly developed textile industry and a decrepit
infrastructure that dogs factories with power cuts, transport problems,
and bureaucratic delays.
Even after the MFA ends, the garment trade will still be affected by the
tariffs and anti-dumping regulations allowed under WTO rules.
Export drives
Governments of poor countries have looked to boost exports as
a means of achieving economic development. One of the key methods has
been the creation of Export Processing Zones (EPZs) in which investors
receive a number of incentives to produce for export, such as tax holidays
and the suspension of local labour laws. Total employment - all industries
- in EPZs rose from 50,000 in the early 1970s to some 5.7 million by the
mid-1990s, spread across at least 35 countries.15
Communications
Advances in transport and telecommunications have made it possible
for firms on different sides of the world to be in round-the-clock contact,
facilitating the flow of information, orders and designs that lies at
the heart of trade networks.
Despite these improvements, the shipping times involved in sourcing clothes
from factories thousands of miles away remain an important issue. The
parts of the industry which have been most easily relocated are those
which require large quantities of standardised goods such as jeans or
T-shirts. However, when it comes to the fashion market, where the must-have
garment can change from one month to the next, transport times become
vital. The development of electronic stocktaking and reordering systems
allows retailers to keep far smaller stocks, relying on just-in-time delivery
to replenish the shelves.16
This means that a short turn-around time is essential.
Proximity to major markets
The increased competitive edge conferred by proximity to the main
market has also spawned garment industries in poor countries on the peripheries
of the large consumer areas of the European Union and United States. Europe
is now surrounded by a cordon of garment producers in North Africa and
Southern and Eastern Europe. In 1994 the North American Free Trade Agreement
(NAFTA) brought together the United States, Canada and Mexico, giving
Mexican factories preferential access to the massive US market, as well
as the unique advantage of a 2,000-mile common border. Mexico now supplies
a growing slice of the US market, overtaking China as the biggest single
source of US garment imports.17
B2. Responses to globalisation
The garment industry is a major source of jobs and export income, and
governments in both the First and Third World have responded with differing
degrees of success to the breakneck pace of change in the world's clothing
market.
With the exception of Italy, the rich economies of the First World have
lost out to the low-wage producers of the Third World and Eastern Europe.
In the European Union, where 2.8 million people still work in the textile,
clothing and footwear industry, trade unions predict that between 600,000
and 860,000 jobs could disappear over the next few years.18
Countries and industries threatened by lower-cost competitors have the
following choices, with countries often adopting a mix-and-match combination:
Move up-market
Countries with mature garment industries have tried to move up-market
to produce clothes where labour cost is a less important proportion of
the final price. This can involve introducing new technology such as computer-aided
design (CAD), or computer-operated cutting machines, which save on time
and cloth. It can also mean developing new kinds of synthetic fabric.
First world producers with large domestic markets have also opted to produce
for the volatile fashion market, relying both on their proximity to consumers
and their greater understanding of first world fashions.
Italy stands out as a first world economy that has successfully bucked
the globalisation trend. This has not happened by accident. From the mid-1970s,
Italian firms mixed investment with a strategy to build up Italy's profile
in the global fashion industry. Clothes manufacturers in northern Italy
financed the development of an Italian look by designers such as Armani
and Versace. Europe's fashion capital moved from Paris to Milan.19
But moves up-market only buy time, as producers in the Third World learn
new techniques, adopt new technology, and reduce their turnaround times.
First world producers must constantly evolve to survive.
Cut costs
While some firms have managed to stay ahead of the market, all have
had to cut costs and raise productivity. This has involved a wide range
of strategies, including national policy changes over the labour market
and foreign investment, and company practices on production methods and
labour relations.
Relocation ("if you can't beat 'em, join 'em")
For companies, the simplest answer to being undercut is to relocate
production to a country where wages and production costs are lower. Many
companies in the First World and more developed Asian economies have done
precisely that. One US entrepreneur, Irwan Gordon, president of a New
Jersey company, shows unusual candour on the benefits of sourcing from
China. He explains the reasons for his company Ava-Line's success:
"We have a factory in China where we have 250 people. We own them;
it's our factory. We pay them US$40 (£23.60) a month and they work
28 days a month. They work from 7am to 11pm with two breaks for lunch
and dinner. They all sleep together, 16 people to a room, stacked on four
bunks to a corner. Generally, they're young girls that come from the hills." 20
Relocation also enables companies to take advantage of free trade agreements
such as NAFTA or the European Union, or to gain access to MFA quotas.
Subcontracting
There has been a rise in the use of subcontractors throughout
the garment industry, as manufacturers have found that it can prove cheaper
to pass work on to smaller producers, and concentrate on areas such as
marketing, design and quality control, rather than make clothes in their
own factories. In the Philippines, garment manufacturers subcontract anything
up to 75 per cent of output. Studies show that garments produced in the
parent factory are up to three times more expensive than those subcontracted
out, although subcontracting decreases the reliability of quality and
delivery.21
Subcontracting saves money for several reasons: the manufacturer can adjust
production to fit the orders, rather than having to pay staff when there
is no work for them, or going through the expense of hiring new workers
when business is good. It cuts overheads, and allows the manufacturer
to shop around between firms and even between countries.
Subcontracting frequently occurs at a number of different stages in the
production chain, as firms farm work out to smaller and smaller companies,
sometimes ending in unregulated and semi-legal sweatshops and homeworkers.
The result is so complex, that garment retailers at the top of the production
pyramid privately admit that they often have no idea where their clothes
are actually manufactured.
Homeworking
One of the consequences of the push for more flexible production
patterns and the spread of subcontracting has been a boom in homeworking
worldwide. Homeworkers, the vast majority of them women, are typically
paid less than factory workers, based on a piece rate system. They have
no job security. Homeworking is often almost invisible to the authorities,
and is made up of isolated individuals with few contacts with other homeworkers.
It is a notoriously difficult area for trade unions or other organisations
to work in.
However, some international research and lobbying work does take place,
by organisations such as Homenet and Women Working Worldwide. In 1996
the ILO adopted a new convention (177) which, once ratified by national
governments, will establish rights for homeworkers. This is a major step
forward in the regulation of the sector.
A subcontractor's story
The Mandarin garments co-operative is a sweatshop in a run-down
quarter of Manila, Philippines, trapped in a subcontracting arrangement
that forces workers to exploit themselves to survive. Numerous whirring
fans beat back the heat. Neatly dressed barefoot women sit at benches
before ancient sewing machines, with piles of cut pieces waiting for stitching.
There are plenty of neon strip lights and good ventilation. This week's
batch of sewing consists of T-shirts bearing the lugubrious face of Elmo
from Sesame Street. The parent company pays the co-op 8.5p per shirt for
the stitching. Co-op president Ester Tindoy explains:
"We were founded accidentally. We were working for the Mandarin International
company, owned by Mr Lim. We formed a union, the government recognised
it, and Mr Lim closed down the factory putting 200 women out of a job.
We went on strike and took him to court. He bought off most of the workers
with a redundancy package but 59 of us didn't accept the offer. We negotiated
for him to give us 19 sewing machines and a £3,600 start-up grant
to set up on our own.
"Of the 59 who started two years ago, only 20 are left; the others
couldn't adjust to being in a co-op. They wanted regular wages, and the
privileges they'd had before. They couldn't understand that that's not
possible in a co-op, so they went for other jobs.
"Now we earn less than we did at the old Mandarin. We work on a piece
rate, and take home an average of 700-800 pesos (£10.29 - £11.76)
a week. We subcontract from bigger companies and we can never relax; the
job we have at the moment has to be finished by Friday.
"We make children's clothing - T-shirts and dungarees - for export
to Canada and elsewhere. We work from 7.00am to 5.00pm, six days a week,
if there is no rush. If we have a tight deadline, we work from 7.00am
until 7.00pm. If we don't meet the deadlines, we lose our advance next
time."
B3. Trading places: rise of the Asian garment industry
In the early twentieth century and for centuries before, Asia was a source
of raw materials such as cotton, which were shipped for processing in
the textile and garment factories of Europe. The wheel of economic history
has come full circle; now Asia imports the raw materials to make and export
textiles and clothing. The process is rich in historical irony, as Britain
destroyed India's textile industry to create a market for Manchester's
factories (Karl Marx used this as the classic example of colonialism).
Now Asia has wrought a historic revenge.
Japan led the way, accounting for 20 per cent of world garment exports
in the 1930s. Soon, however, it switched to more complex, profitable products
such as cars, stereos and computers. Between 1965 and 1983, the Japanese
textile and clothing sector sacked 400,000 workers.22
Since then, the development of the Asian garment industry has epitomised
the creative destruction that lies at the heart of globalisation. Different
countries have emerged as significant garment producers in a series of
waves, each one undercutting its predecessor.23
First Wave : South Korea, Taiwan, Hong Kong, and Singapore,
often referred to as the Asian Tigers, comprised the first wave, developing
dynamic garment industries in the 1970s. As their economies developed,
skill levels and wages rose (not least because of a strong trade union
movement in South Korea). Companies responded by moving into more complex
goods and shifting their low-skill, labour-intensive industries overseas
to countries with cheaper workforces. Korean and Taiwanese investors,
in particular, developed their design and marketing capacity, while setting
up garment factories elsewhere in Asia, as well as moving to Central America
and Mexico to produce for the US market.24
Second Wave : Between 1985 and 1990, garment production rose
sharply in the Philippines, Malaysia, Thailand, and Indonesia as they
took over the export drive from the first wave countries. However, by
the end of the decade, several new players had appeared on the scene,
with lower wages and fewer MFA quota restrictions than the second wave,
whose exports were swiftly eclipsed.
Third Wave : The 1990s have been dominated by the third wave
of exporters. These include Bangladesh, Sri Lanka, Pakistan, and Vietnam,
but one country far outweighs all the rest - China. In less than ten years
from the late 1980s, China rose from nowhere to become the world's major
producer and exporter of clothing [see Case Study: Made in China, page
22].
The Asian economic crisis of 1997-8 has had a profound, but mixed, impact
on the garment industry. Extraordinary currency devaluations in countries
such as Indonesia and Thailand have restored those countries' competitive
advantage. In the case of Indonesia, the daily minimum wage in Jakarta's
garment factories fell from £1.44 to 26p between July 1997 and August
1998. However, Indonesia's banking crisis dried up credit for garment
manufacturers, while the political and economic instability deterred many
investors and buyers from attempting to cash in on what were probably
the cheapest wages in the world. As a result, thousands of garment workers
were laid off during 1998.
B4. Clothes to die for: wages and conditions
Studies and visits by CAFOD researchers and partners in the region reveal
huge variations in the wages and conditions of Asia's millions of garment
workers. In some countries, such as the Philippines and Sri Lanka, a history
of active trade unionism, and state support for some degree of labour
rights, have established expectations about acceptable labour standards.
In others, such as China, Vietnam, and Bangladesh, the floor is often
set by physical endurance; how many hours a day, over how many years,
can one ill-nourished human body continue to function. Despite the suffering,
government repression and extreme poverty guarantee a largely docile workforce.
CAFOD's concern is that these different systems are in open competition
in a sort of Market Darwinism, where the prize of survival often goes
not to the strongest, but to the cheapest and most repressive. Decades
of hard-won advances on labour rights and living conditions in the less
poor countries are being eroded and living standards undermined.
Wages
(See also table page 10)
Maslaha is a young Indonesian Muslim woman in a spotless outfit. For the
last five years, she has worked for PT Griya Prima making garments for
US companies such as Gap, Levis, Docker and Request. She shares her tiny
8ft-by-8ft room with three other girls from the same factory. At night,
only three of them can fit on the floor, so the fourth sleeps on a large
shelf just under the tin roof. The room is stifling as the sun beats down.
Maslaha says:
"I'm from central Java. I came to Jakarta five years ago looking
for work. I wanted experience. I didn't want to be a farmer; they earn
even less than we do. My parents still live in the country. We earn 57p
a day. Our rent is £15 a month, between the four of us. On top of
that, we pay for baths, and eat off stalls; there's no kitchen."
57p a day for ten hours work. Other Indonesian garment workers earn even
less. A kilo of rice -a staple food -costs 12p. In terms of buying power,
Maslaha's wage is equivalent to a British worker earning just £4.51
a day.
In Asia, wages have risen in the first wave countries of South Korea,
Taiwan, Hong Kong, and Singapore, but the countries that came after have
failed to follow suit. Competition with their cheaper neighbours has undermined
their industries before they could upgrade skills and investments to move
into higher value goods in the manner of the first tier of Tigers.25
Face behind the label: Dani, working for Gap in Indonesia
Dani lives with his wife, Nyai, and two children in a two-room
plywood shack by the railway line in the Indonesian capital, Jakarta.
The house shudders whenever a train roars past, inches from the front
door. The gaps in the walls are covered with "Do Not Use" stickers
from a Massachusetts clothing company. Family possessions consist of an
electric fan, a small tape recorder, and a battered eyeless teddy for
the children. Dani, the family's sole breadwinner, is one of the millions
of Indonesian workers buffeted by the economic crisis that struck the
country in late 1997. He says:
"I work for PT Griya Prima, making clothes for Gap and Docker. Things
are bad; they aren't paying our wages on time. They're laying off 400
people at the factory. There's no overtime any more, so we're earning
the minimum wage of 35p a day. We're living off our savings. We try to
make do, but we have to pay rent, electricity, and water. The price of
milk has trebled so we've stopped buying it for the children; we give
them sweet tea and water. Food is vegetable soup with lots of water. Sometimes
an egg, but never meat. We're worried about the future; we can't imagine
what's going to happen. I want to make more of my life, but when I get
home at night, I'm tired. Nyai feels the work is too hard for so little
money."
Hours
Hours worked in Asia's garment factories can be phenomenal. In
Bangladesh, a young garment worker, Mohammed, told a CAFOD researcher:
"I didn't go to work today because I'm not feeling well. I'm ill
because I haven't had a day off in two months. My head feels heavy and
sore. I get fevers. I have no energy left. There's no doctor or medicine
at work. Normally, I only get one day off a month. I won't get paid for
today. I told my supervisor, and he said that if I don't go in tomorrow
they'll dock three days' salary. The hours are long, 8.00am to 9.00pm
or 10.00pm, and sometimes until two in the morning or all night. The management
decides on overtime; we do what we're told. I'm not happy about the hours,
but there's nothing I can do. If I complain, the managers say, 'if you
don't want to work overnight, you won't work here any more.'"
In several countries, workers receive a small bonus if they forego even
one day off a week and work the full seven days. Despite this, so low
are the wages that one of the most frequent demands of garment workers
interviewed by CAFOD is for more overtime.
Abusive Treatment
Treatment in many factories seems designed to humiliate the workforce
as much as to increase production. Supervisors throughout Asia exhibit
what one trade unionist described as, 'an obsession with toilets'26.
They constantly harass women who want to use them. Workers in the Delphi
factory, in Vietnam's Tan Thuan EPZ, went on strike in June 1997, after
Taiwanese supervisors with a long history of physical abuse forced them
to line up and wait in the rain for long periods of time. Workers in the
factory caught going to the toilet without permission were fined the equivalent
of £2.65 each time - about three days' wages.27
In Sri Lanka, shifts in garment factories last an average of ten hours,
according to People's Forum for Development Alternatives (PEFDA), who
interviewed young women in numerous garment factories in the Kandy and
Kurunegala areas. During this time many of the young women must stand,
except during brief lunch and tea breaks. One young woman, Nilanthi, reported:
"My ankles get swollen. My knees ache. In this factory, they know
how many times we go to the toilet. After the second time, it's tough.
The supervisors know how to make you feel bad, so you just hold out until
the work comes to an end." For this, she earns roughly £29.50
a month.
Health and Safety
Many of the most pressing health issues for garment workers stem
from the interminable hours they spend performing repetitious tasks. Dr
Pratima Paul-Majumder, a Bangladeshi academic who has interviewed hundreds
of garment workers says:
"My main finding is that the garment industry is so bad for women's
health that they cannot continue for more than four or five years. Often
they leave as invalids. It's just too strenuous. I found no one who had
been there since the beginning 15 years ago. Women eat better, get better
medical treatment and housing, for example with electricity and water,
but that cannot compensate for the hours they work. Their families are
better off, but not the women themselves in health terms."28
Repetitive strain injury (RSI) is becoming increasingly common, while
long hours spent standing at a workstation can cause dizziness and other
complaints. Factories in Sri Lanka discourage employees from taking sick
leave, according to a worker, Wimala, who says:
"We don't take sick leave. You don't go if you can't stand up. Otherwise,
you have to go. Even if they don't say it, they don't want people who
fall sick often. If I can't do the work, there's always someone to take
my place."29
Such is the desperation in rural Sri Lanka that there are often hundreds
of applicants for each job vacancy in the factories. A study of women
workers in Vietnam's EPZs concluded:
"Due to an urgent need for employment to support their families they
are ready to work under extreme pressure - including overtime or night-shift
work - and in an environment where the levels of noise, dust, heat, humidity,
and even poisonous chemicals exceed the allowable limit."30
Perhaps the most notorious example of the low priority given to health
and safety is the regularity with which factories burn down. In Bangladesh,
according to Dr Pratima Paul-Majumder, 115 women have died and many more
have been injured in factory fires during the 1990s. Most of the deaths
occur due to stampedes, as workers trapped in factories panic and rush
to the only exit. Most of the factories have no emergency exits.
Intimidation of trade unions
The creation of trade unions has always proved a crucial first step in
improving conditions. A factory fire at the Triangle Shirtwaist factory
in New York in 1910, leaving 146 dead, was a turning point in the creation
of the trade union movement in the United States.
The fight for free and independent trade unions lies at the heart of garment
workers' efforts to improve their lot. The emphasis should be on free
and independent, for trade unions in Asia are not always what they seem.
In countries such as China, Vietnam and Indonesia, unions are largely
controlled by the state, which uses a combination of co-option and repression
to prevent the emergence of an independent union movement.
Many employers head for countries such as China and Indonesia precisely
because of the government's ability to prevent trade unions from raising
their labour costs. EPZs across Asia have created trade union-free enclaves
for the benefit of manufacturers, both foreign and domestic.
One advertisement placed by the Bangladesh Export Processing Zone Authority
carries the headline, "For optimum profits, invest in EPZs in Bangladesh"
and goes on to reassure companies that, "Bangladesh offers the most
inexpensive and productive labour force. Law forbids formation of trade
unions in the zones and strikes are illegal."31
Outside the zones, trade unions face enormous problems, involving sackings
of union organisers and worse. In July 1998, a CAFOD researcher witnessed
the aftermath of a razor attack by hired thugs on a trade union activist
in Dhaka, a young woman whose face was badly slashed (see box below).
In Indonesia, garment workers point to the level of militarisation
of their factories as one of the key obstacles to improving their lives.
Factory owners pay a retainer to the local military commanders, who then
come in and break up any strikes. In countries such as Sri Lanka, where
there is a stronger trade union tradition, workers are more likely to
win disputes, although they still face high levels of harassment and intimidation.32
Union member suffers razor attack
In the filthy casualty ward of a Bangladeshi hospital, two doctors
are bent over a prone figure in the light of a single bulb. The room stinks
of urine and sour sweat. The sound of the torrential monsoon rains outside
fills the ward. The woman on the bed is Minara, a sewing machine operator
in World Fashion, one of Bangladesh's 2,700 garment factories. She was
rushed to hospital an hour ago with deep cuts to her neck, face and hands
after a razor attack by two mastaans, thugs hired by the factory owner.
A plastic bowl full of blood-soaked cotton wool lies under her bed. Blood
also stains her sari and shawl, and the clothes of her sister, who brought
her here. Her sister is semi-hysterical, weeping that Minara will now
be scarred, and will be thrown out by her husband. The doctor says that
Minara's hand could be permanently damaged from the cuts inflicted as
she tried to fend off her attacker.
Minara was attacked as she walked with her fellow workers to the office
of the Bangladeshi Independent Garment Workers Union Federation (BIGUF).
The union has been in dispute with the company since it managed to get
the 30 per cent of workers necessary for legal registration. When the
leaders refused to be bought off, they were called to a meeting with management
and beaten senseless. BIGUF and the Bangladesh Garments Manufacturers
and Exporters Association (BGMEA) stepped in to force the owners to the
table, and the previous day they had reached agreement. Only minutes before
news of the new attack arrived, BIGUF president Sheik Nazma commented,
"The intimidation was typical of what happens to workers who try
to form a union, what is unique is the agreement." She spoke too
soon.
The factory management has plenty of reasons to want to prevent its employees
forming a union. According to one worker, Julekha, its workers work a
seven-day week, often putting in a 15-hour day, sometimes more. This has
been a busy month and on seven occasions already, workers have gone through
the night before snatching a couple of hours sleep on the factory floor.
If she puts in over 100 hours overtime a month on top of her normal 63-hour
week, Julekha gets a bonus, bringing her monthly earnings to £28.73.
Short-term contracts: Philippines case study 33
Increasing numbers of Filipino companies have stopped hiring permanent
staff and switched to contractuals, as they are known locally. This is
technically illegal under the national Labor Code, unless in exceptional
circumstances, but these offer sufficient loopholes for companies to bypass
the law. Even according to government estimates, ten per cent of the workforce
is now employed in this way.34
When Urban Missionaries, a CAFOD partner based in the Philippines, interviewed
contract workers in 21 garment factories in the Manila area, they found
that:
- Contract workers earn on average about 25 per cent less than the
minimum wage (£2.25 a day compared to £2.87).
- Most of them are recent migrants from the countryside.
- They are the first to be laid off when orders decrease.
- They face the sack for speaking out over issues such as low wages.
- They do not receive the employment benefits enjoyed by regular workers
such as social security payments and health insurance (Medicare).
- They receive no sick leave or paid holidays.
They risk the sack for even talking to union representatives, let alone
trying to join a trade union.
study concludes: "Contractual garment workers are not living their
lives to the fullest. They are forever burdened with financial, family
and health problems. They do not have enough money to cover their basic
needs. They get sick due to work-related illnesses and family relationships
get shaky when they reach this point."
Face behind the label: Marilou, a contractual worker in the Philippines
Marilou operates a sewing machine at the Golden Thimble factory
in Manila, making garments for export. At 32, her working life in the
garment industry is almost over. She is on a five-month contract and time
is running out. She says:
"I've worked in the garment industry since I left school at 18. At
first I was a regular in the Glorious Sun factory. It's better to be a
regular, to have the benefits, the job security. When I was a regular,
I got maternity benefits, but not now (not that I want any more kids!).
I was a union member there, but I'm not allowed to join here; none of
the contractuals can.
"The five month limit is awful; you're always worrying about the
next job. I'm 32 now, and once I'm 35, I'll be over the age limit. Then
I'll just have to stay at home and look after the kids. I feel happy and
sad. Happy to be with my kids again, even though I've missed their babyhood.
Sad not to have a job any more."
B5. Garments and development
Economic orthodoxy holds that building up a garment industry is the first
step on the ladder of industrialisation. It is true that garment industries
have spread across many of the world's poorest nations, providing employment
for millions. But what happens next? The theory goes that as skills improve
and wages rise, firms will move up-market into new, higher-value products.
But in practice, the link between garments and development appears to
have been unstitched by the pace of globalisation. While the first wave
Asian countries - South Korea, Taiwan, Hong Kong, and Singapore - have
indeed moved onwards and upwards, those that followed have not. This is
because:
- Their factories have been built largely by foreign investors, often
from the first wave economies, with no long-term commitment to the
country. When wages rise, or a cheaper country enters the market,
they simply move on.
- The increasing volatility of the garment trade, with its short-term
commitments through subcontracting, deters long-term investment and
development efforts by manufacturers and governments alike.
- The downward pressure exerted by competition from more and more
impoverished countries getting in on the garment trade means that
in those countries where garment jobs have increased, wages have actually
fallen.35
The International Labour Organisation (ILO) concludes:
"Distributors select their foreign suppliers on the basis of comparative
costs, as well as quality and reliability; this weakens any long-term
development prospects of production and employment in enterprises in developing
countries. Furthermore, the competition between an increasing number of
developing countries to win contracts has a downward effect on wages and
conditions."36
Garment producers experience this on a daily basis, as they negotiate
prices with retailers and their buyers. As one Bangladeshi manufacturer
explained to a CAFOD researcher:
"The buyers always say the market is bad and we have to lower the
price; it's their standard technique. So for the last few years, our costs
have been rising, but prices haven't. There's always competition from
China, and now Indonesia and Thailand are cheap again. When the quota
system stops in 2005, the buyers will get the upper hand even more. It
is a rule of nature; water always goes down. If the price is cheaper,
buyers will go to that country."37
In Thailand, globalisation is a powerful weapon in the hands of employers,
according to a meeting of union activists in a Bangkok suburb. Around
20 women and men come along. Some are in their blue work clothes as they've
come straight from their shifts. One of them says:
"We get Sundays off and 13 or 14 days a year. We get a bonus if we
don't take holidays. We were told if we demanded too much money, the company
would relocate to other countries; one factory moved to Laos recently.
Are we paid too much? After ten years service, we take home about £13
for a 48-hour week. We used to get overtime on top of that, but now it's
stopped. We've all heard that from employers, but we don't believe the
Chinese can do the work as well as us. They tell us the Chinese work faster
and can do many different jobs at the same time. They've threatened us
with the sack if we don't do the same."38
Globalisation exerts downward pressure even between regions within the
same country. In China, buyers from US companies such as Sears are moving
their orders from state-owned factories in the north to foreign, privately
owned plants in the south. Here wages can be half the typical 17p-an-hour
figure in the north. Factories in the south keep costs down by axing benefits
such as sick pay, pension insurance and maternity leave, which are paid
in the state-owned factories in the north. They also force their employees
to work even longer hours and make far more use of subcontracting than
those in the north.39
At a national level, countries lose out to competitive globalisation through
the race to provide ever-juicier incentives to investors shopping around
for the location of their next factory. They offer tax holidays and exemptions,
ready-made facilities, subsidised building land and cheap credit. But
each new incentive reduces the potential benefits to the host country.
The ILO concludes: "At the moment too many countries are adopting
these practices and trying to outbid each other by offering various advantages
which might be ruinous both from an economic and from a social standpoint."40
The losers in this are often those caught in the middle, living in countries
that have achieved a degree of development, often accompanied by a ramshackle
system of welfare and labour rights; usually the legacy of past policies
of state-led development, now abandoned in favour of an embrace of unfettered
market forces. Without either the technology or the skills to upgrade,
countries such as the Philippines are faced with the bitter truth that
their wage levels, at about 40p an hour (see table page 11), are simply
too high for the garment industry. They are pushing through reforms to
set up EPZs, restrict labour rights and encourage subcontracting and flexible
(read insecure) labour markets. Poor garment workers' lives must get worse
if they are to keep their jobs.
Case Study: Made in China 41
In 1976, the Chinese government, under the new leadership of Deng Xiaoping,
embraced globalisation, embarking on a drive for economic development
based on exports. The results have been staggering. Even allowing for
population growth, national output increased seven-fold between 1979 and
1993.
This was largely achieved by setting up Export Processing Zones (known
in China as Special Economic Zones). These were then filled with garment,
shoe, electronic and other factories, owned by both foreign and Chinese
capital, including a number of factories owned by the state or the People's
Liberation Army. Four million garment workers now toil in 44,000 factories
strung across hundreds of EPZs around China's coastline.
By 1998, China had eclipsed all other countries, ranking as the world's
number one garment exporter. In the first quarter of 1998, 30 per cent
of Britain's garment imports came from China and Hong Kong.42
The attractions for investors are unbeatable: tax holidays, cheap land
and buildings, exemptions from import taxes, and above all a vast pool
of cheap, compliant workers. The majority of workers in the garment factories
are young women (15-25), who migrate from impoverished rural areas. Their
aim is to work themselves as hard as possible in order to save money for
marriage, or to open a small business, when they burn out (or are thrown
out) and return to their villages.
These are relatively uneducated workers, speaking several different dialects.
If they complain about wages or working conditions they risk the sack
and the loss of their dream of escaping from rural poverty. In the countryside
there are at least 150 million people eager to take their jobs. Many more
are scheduled to join the job hunt as the Chinese government embarks on
a privatisation programme which will mean millions of job losses in the
traditional state-owned industries such as iron and steel.
But for those in work there is plenty to complain about:
- Legal minimum wages are set by each provincial government and vary
from 6p to 17p an hour; yet one survey of foreign-owned factories
in EPZs showed that over half paid their workforce less than the local
minimum wage.
- Workers are subject to innumerable deductions from their pay packets,
and many have to pay their employers sizeable deposits when starting
a job. These are not always refunded when they leave.
- Although China has good labour laws, they are not implemented. Many
workers have no idea of their rights to holidays, limits on overtime,
or even a contract. They told investigators from the US-based National
Labor Committee that they thought overtime began after midnight, over
14 hours after their working day had started at 7.30am.
- Hours can be excessively long. Workers usually work a 10-12 hour
day, some as long as 15-16 hours, with one or two days off each month.
Some have no holidays at all.
- Working conditions are dangerous, with widespread exposure to toxic
chemicals, fire hazards and industrial accidents.
- Many companies impose body searches on their employees, ban them
from going to the toilet or drinking water, and carry out ritual humiliation
for minor misdemeanours. This can include making workers stand for
long periods wearing a large "shame" placard hung around
the neck. Some factories were found providing electric shock batons
to their foremen for use on the workforce.
A survey by the official trade union - the All China Federation of Trade
Unions (ACFTU) - of conditions in foreign-owned factories in Guangdong
province revealed that over a quarter of the workforce were unable to
draw their wages on time, and almost half were forced to work more than
eight hours a day. Some 62 per cent worked seven days a week; one in five
encountered physical or mental harassment, and over half received less
than the minimum wage.
Wages and conditions have deteriorated in recent years, prompting a series
of wildcat strikes, but protesters face extraordinary obstacles. Only
ACFTU-approved unions are allowed in the EPZs, and the ACFTU is under
the complete control of the ruling Chinese Communist Party.
A 1990 ACFTU document stated in a tone of thinly veiled menace: "ACFTU
unions must resolutely oppose any organisation or individual expressing
political views countering those of the Party… On discovering the
formation of workers' organisations, which... endanger the national regime,
the trade union must immediately report [them] and must resolutely expose
and dissolve them. Concerning organisations initiated by workers out of
their specific economic interests, the union should advise them to dissolve
and terminate their activities through persuasion and counselling."
(author's italics)
To ensure that local ACFTU-affiliated unions side with management, managers
often assume leadership positions in the union. Of 250 trade union chairpersons
in 1993 in Shekou Industrial District, Guangdong province, 143 were senior
managers of the firms involved.
Han Dongfang, a labour activist imprisoned for two years, during which
time he lost half a lung to tuberculosis, came to bitter conclusions about
China's courtship of the global market:
"People have always said foreign investment is the hope of China.
This is our bridge to the world. But what comes across this bridge are
12-hour shifts, seven-day workweeks and only two trips to the bathroom
a day. What comes across are factory fires that kill hundreds of workers
who are locked in because their bosses are afraid they will steal their
products. The Chinese government has put an invisible net across the bridge
that allows money to come in but not the freedoms of a civil society,
not the rule of law, and not free trade unions."
Blessing or curse: life for women in the garment industry
Most garment workers are young women, chosen by employers for
their perceived combination of dexterity and docility. For them, the garments
boom is both a blessing and a curse. Before the advent of the garment
industry, few Bangladeshi women went out to work, other than as domestic
servants. Now, their entry into the workforce has transformed women's
lives. Dr Pratima Paul-Majumder, a specialist at the Bangladesh Institute
of Development Studies, says:
"My research shows that most women [in the garment industry] now
have control over how their income is spent. Women decide whether their
children will go to school. The age at which they get married, and the
age they have their first baby, is two years higher among garment women
than the national average (19 years compared to 17). At the beginning
there was prejudice against garment women for going out to work, but I
think that is fading now."43
Women face a number of barriers because of their gender. The first is
income. In countries such as China, Vietnam, and Sri Lanka their meagre
wages are a vital source of income to their families, but in Vietnam women
routinely earn 10-15 per cent less than men performing the same jobs.44
Rights to maternity provision and menstruation leave, enshrined in law
in countries such as China and Indonesia, are rarely enforced by governments
unwilling to challenge illegal practices for fear of frightening off investors.
As well as low wages and long hours, women face threats such as body searches,
sexual harassment and intimidation from the male-dominated ranks of management
and supervisors. In Sri Lanka, women workers who leave home to work in
the EPZs face sexual harassment on their way to and from work, and are
widely regarded as fallen women. Marriage advertisements in the newspapers
frequently say that EPZ employees should not apply.45
For many women, arriving home at the end of an exhausting stint on the
production line brings little respite. In Vietnam, for example, research
suggests women must spend a further four to five hours on household chores
and childcare on top of their shift at the factory, while men put in a
mere one to two hours per day at home.46
The gruelling work-rate led one team of researchers from PEFDA in Sri
Lanka to conclude: "Young girls, barely out of their teens, eager
to escape their monotonous poverty, become burnt-out cases before most
of them even have a chance to get married."47
Face behind the label: Hasina, a sewing machine operator in Bangladesh
Hasina thinks she is 22, but is not sure, and can just about write
her name. Even getting to her straw-and-bamboo hut in the capital city,
Dhaka, is an adventure. It stands on a raised earth mound in the middle
of an evil-smelling marsh. To get to it requires a walk along a single
bamboo trunk, which cracks alarmingly underfoot. It is Friday, the Muslim
holy day, and the call to prayer drifts across shack and marsh.
Hasina is an optimistic, smiling young woman, dressed in a striking orange
and pink sari. She lives here with her husband and his parents, and her
four-year-old daughter, Yasmin. Hasina and her husband, who works in the
same factory, are both clandestine union activists. She says:
"We make nightdresses and trousers for America and other countries.
Normal hours are 8.00am to 5.00pm. After that we work until 9.00 or 10.00pm,
but sometimes we have to work all night. We work seven days a week –
today's my first day off in two months. Sometimes we get ill - headaches
or exhaustion. We have no energy left. There's no doctor in the factory.
I've put a needle through my finger twice - the management gives you Paracetamol,
Savlon and a bandage. I didn't even get any time off! After these long
hours, I have to help my mother-in-law, but I have no energy left. My
relationship with my daughter is very weak. I leave home when she's asleep
and she's already asleep when I get back at night.
"At the end of the month, my take-home pay is about £19. I don't
like the hours, but the managers just say, "that's your problem.
If you've got kids why have you come to work?" I'm not happy about
it, but what choice is there? Sometimes I feel tired and ill after a 13-hour
shift. I'd change jobs, but there's nothing except domestic work, and
that's too low status and dangerous.
"Mind you, things are better for women because of the garments. Earning
our own money has given women some kind of freedom. Now I can help support
my family. In the old days, women like me were afraid, because we had
to depend so much on our husband and family. We had to obey whatever.
Now we have more confidence. We talk to our co-workers, we feel freer
in society than we were.
"When I had Yasmin I just took three months off unpaid and then went
back to work. I know I have a legal right to maternity pay, but the management
refuses and what can you do? The management won't allow trade unions.
If they knew I was a member, I'd be sacked, maybe beaten up. But I joined
because the wages are too low, and I go the union office to discuss how
to improve things."
As Hasina talks, Yasmin starts to play on the family sewing machine. She
looks remarkably competent, but Hasina says: "I wouldn't want my
daughter to work in the garment factories. Our life is so hard there.
I want to educate her so she can work in something else - anything."
There is an alternative
Does it have to be like this? Left to itself, the market can be
a pitiless and rapacious force. As one American trade unionist observed,
"Nice guys go out of business"48. The
question is, how can the market be regulated in order to end the downward
spiral of globalisation, and unleash its potential for good, in the shape
of job creation, technology transfer and development? The next section
looks at one means to this end - the introduction by retailers and manufacturers
of codes of conduct that set minimum standards for their third world suppliers.
Key points
- In the last twenty years, economic globalisation has prompted a
leap in the Third World's clothing industry, led by China and other
Asian economies.
- CAFOD's research in Asia reveals that the cut-throat competition
between producers is leading to a system of Market Darwinism where
the prize goes to those countries with the lowest wages, longest hours
and most repressive approach to their workforce.
- As a result, the garment industry is no longer leading to
lasting economic and social development.
- For Asian women, who make up the majority of garment workers, the
clothes industry provides much-needed income and status, but exacts
a high price in terms of exhaustion and health problems.
CAFOD and Asian garment workers
In the Philippines, CAFOD has supported the work of the Manila-based
Urban Missionaries (UM). UM helped found a coalition of 17 organisations
called Solidarity of Church People and Workers against Globalisation (PATAMA).
Through PATAMA, UM is lobbying the Filipino Congress on laws to do with
labour flexibility and subcontracting. It has successfully persuaded senators
on the Labor Committee to sponsor a bill "strengthening the right
to security of tenure" to deter the practice of contractual working.
In Sri Lanka, CAFOD supports the Resource Centre for Community Groups
(RCCG) in Dehiwala. RCCG established a workers' centre in the Free Trade
Zone near Colombo Airport, to provide leisure space and recreational activities.
It offers educational programmes, confidential legal and health advice,
and opportunities to participate in solidarity activities on labour issues.
CAFOD also supported the research and publication in Sri Lanka of a study
into the working and living conditions of women workers in the garment
industry.
At a regional level, CAFOD supports the work of the Transnational Information
Exchange - TIE-Asia. TIE works with garment workers in Bangladesh, Sri
Lanka and Thailand. It provides training for labour organisers and other
educational activities, such as setting up a workers' theatre and cultural
group in Sri Lanka and Bangladesh.
(part 2)
Endnotes
1 Alan West (ed), Handbook of Retailing, 1988
2 UK Retail Report (London, December 1996)
3 British Apparel and Textile Confederation, Industry Overview 1996
( London, June 1997)
4 Key Note Clothing Retailing 1997 Market Report (London, 1997), p.
8
5 News of the World, 15 March, 1998
6 Sources: Marks and Spencer Annual Report (1998), Clean Clothes Campaign,
Of Rags and Riches ( Amsterdam, 1997), Finacial Times 21 May 1998
7 Figures for market share may not match turnover figures, which include
non clothes sales
8 Financial Times, 8 April 1998
9 British Apparel and Textile Confederation, Industry Overview, op.
cit.
10 Financial Times, 3 October 1996
11 International Labour Organisation, Globalization of the footwear,
textiles and clothing industries (Geneva, 1996), p. 6
12 International Labour Organisation, op. cit., p. 37
13 Taken from Angela Hale, Phasing Out the Multi Fibre Arrangement -
What does it mean for developing countries garment industries?
(Manchester, Women Working Worldwide, 1996)
14 See Arvind Panagariya, M.G. Quibria, and Narhari Rao, The Emerging
Global Trading Environment and Developing Asia (Manila, Asian Development
Bank, 1996)
15 International Labour Organisation, Globalization, op.cit., p. 53
16 Andrew Ross (ed.), No Sweat: Fashion, free trade and the rights of
garment workers (London, 1997), p. 251
17 Andrew Ross (ed.), op.cit., p. 203
18 Financial Times, 23 May 1997
19 Andrew Ross (ed.), No Sweat, op.cit., p. 237
20 Business News, 21 August 1996
21 Adeli de la Paz-Kraft, The Philippines Textile and Garment Industries:
Structure, Competitiveness and Adjustments (October 1996, mimeo)
22 Maria Fe B. Durano, Garment Industry of the Philippines: Responding
to Global Change (Manila, Philippine Center for Policy Studies, 1996),
p. 2
23 International Labour Organisation, Globalization, op.cit., p. 6
24 International Labour Organisation, Globalization, op.cit., p. 22
25 International Labour Organisation, Globalization, op.cit., p. 83
26 Neil Kearney, International Textile, Garment and Leather Workers
Federation, talk at CAFOD, 13 June 1998
27 Asia Monitor Resource Center, We in the Zone: Women Workers in AsiaÕs
Export Processing Zones (Hong Kong, 1998), p. 181
28 Author Interview, Dhaka, July 1998
29 Drawn from Achintha Kodikara, Gamini Akmeemana, Sarath Fernando and
Saranath Dissanayake, Garment Factory Women Workers (Colombo, PEFDA/Centre
for Society and Religion, commissioned by CAFOD, April 1998)
30 Asia Monitor Resource Center, We in the Zone, op. cit., p. 177
31 Quoted in Asia Monitor Resource Center, We in the Zone, op. cit.,
p. 3
32 Asia Monitor Resource Center, We in the Zone, op. cit., p. 167
33 The material for this section is taken from research by Urban Missionaries,
a CAFOD partner in Manila. See Urban Missionaries, A Research on Contractualisation
and its Effects on Garment Workers, (Manila, 1997, mimeo)
34 Rene E. Ofreneo, The Economic and Legal Dimensions of Labor Only
Contracting, (Manila, PCPS, July 1995)
35 International Labour Organisation, Globalization, op.cit., p. 86
36 International Labour Organisation, Globalization, op.cit., p. 21
37 Author Interview, Dhaka, July 1998
38 Author Interview, Bangkok, December 1997
39 Charles Kernaghan, Made in China: Behind the Label (New York, National
Labor Committee, 1998), p. 45
40 International Labour Organisation, Globalization, op.cit., p. 23
41 This section is based on Asia Monitor Resource Center, We in the
Zone, op. cit., and Charles Kernaghan, Made in China, op. cit.
42 HM Customs and Excise
43 Author Interview, Dhaka, July 1998
44 Asia Monitor Resource Center, We in the Zone, op. cit., p. 188
45 Asia Monitor Resource Center, We in the Zone, op. cit., p. 142
46 Asia Monitor Resource Center, We in the Zone, op. cit., p. 189
47 Drawn from Achintha Kodikara, Gamini Akmeemana, Sarath Fernando and
Saranath Dissanayake, Garment Factory Women Workers, (Colombo, PEFDA/Centre
for Society and Religion, commissioned by CAFOD, April 1998)
48 Andrew Ross (ed.), No Sweat, op.cit., p. 151
49 Philip Rosenzweig, How should multinationals set global workplace
standards?, (Financial Times, 27.3.98)
50 Angela Hale, Company Codes of Conduct: What do they mean for Workers
in the garment and sportswear industries? (Manchester, Labour Behind
the Label, undated)
51 Quoted in US Department of Labor, Bureau of International Labor Affairs,
The Apparel Industry and Codes of Conduct: A Solution to the International
Child Labor Problem? (Washington, 1996), p. 14
52 Jean-Paul Sajhau, Business Ethics in the Textile, Clothing and Footwear
Industries: Codes of Conduct (Geneva, ILO, 1997), p. 6
53 ETI Information Pack, December 1997
54 Angela Hale, Company Codes of Conduct, op. cit.
55 Clare Ferguson, A Review of UK Company Codes of Conduct (London,
August 1998), p. 4
56 Clare Ferguson, A Review, op. cit., p. 6
57 Chris Williams, C&A Head of Corporate Communications, speech, Manchester,
6 May 1998
58 Asia Monitor Resource Center, Asian Labour Update, op. cit., p. 4
59 SOCAM Annual Report, 1997
60 Dusty Kidd, meeting at CAFOD, May 1998
61 Phil Knight, speech, Washington, 12 May 1998
62 Asia Monitor Resource Center, Asian Labour Update, op. cit.
63 Letter to CAFOD, 15 April 1998
64 Clare Ferguson, A Review, op. cit., p. 6
65 US Department of Labor, Bureau of International Labor Affairs, The
Apparel Industry and Codes of Conduct: A Solution to the International
Child Labor Problem? (Washington, 1996), p. 7
66 See for example, Women Working Worldwide, Women Workers and Codes
of Conduct: Report of Preliminary Research and Consultation Exercise
(Manchester, 1998)
67 This table does not include garment manufacturers such as William
Baird and Coats Viyella who supply high street retailers such as Marks
& Spencer
68 Letter to CAFOD 27/8/98
69 Duncan Green, Just How Clean Are Your Shoes (London, CAFOD, 1997)
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