Bangladesh’s US$19 billion garments industry attracts some of the world’s biggest clothing brands because of low costs, but many retailers say unrest over pay and delayed shipping schedules are eroding that advantage.
The killing of a labor activist and increasing publicity of unsanitary and unsafe working conditions at the country’s 4,500 garment factories are also making some retailers worried about their reputation.
Bangladeshi factories make clothes for brands including Tesco, Walmart, JC Penney, Hennes & Mauritz (H&M), Marks & Spencer, Kohl’s and Carrefour. Wages are as low as US$37 a month for some workers.
In June, more than 300 factories near the capital, Dhaka, were shut for almost a week until the government and factory owners promised to consider pay demands and persuaded them to return to work.
“Unrest in the readymade garment sector is a major concern for us,” said a country manager of a large international wholesale customer, primarily located in the US.
“We have calculated that a two-week work disruption in factories producing 1.5 million units of garments daily would lead up to US$8 million losses,” the manager said, speaking on condition of anonymity because he was not authorized to speak to media.
The garments manufacturing sector earned US$19 billion in the first half of the year, one of the impoverished nation’s biggest industries. Bangladesh is the world’s biggest exporter of clothing after China.
Readymade garments make up 80 percent of the country’s US$24 billion in annual exports. Consultancy firm McKinsey & Co has said Bangladesh can double its garments exports in the next 10 years.
However, conditions in the industry are below standard. Besides scanty pay, working conditions and safety standards are poor, employees and some analysts say.
Nazma Begum, a worker at a factory at Ashulia, near Dhaka, said the main cause of unrest was low pay, which barely covered family costs.
“Now I get 4,200 taka [US$51] per month, which should be raised to at least 6,000 taka,” she said. “I spend almost one-third of my wage for hiring a one room shelter, while the prices of all daily necessaries are going gone up. Unless our pay is raised accordingly, there will be more unrest.”
“I have three children and my husband is a rickshaw puller,” said Salma Begum, 35. “Together we earn about 6,500 taka a month, but still we are in debt, often borrowing from friends.”
Bangladesh’s 4 million garment workers are mostly women, who work 10-15 hours a day, six days a week.
Some factory owners employ thugs to put down protests.
In April, labor activist Aminul Islam was found murdered and his body bore signs of torture. No one has been arrested.
Human Rights Watch said the killing raised the possibility of government involvement because Islam had been detained and tortured by security officials in the past.
Officials dismissed the suggestion.
“If anyone blames the government for his death, it is unfortunate. Why should the government do it?” said Kamal Uddin Ahmed, additional secretary in the Ministry of Home Affairs.
“However, we understand that until we could find the culprits, it might have some negative impact on readymade garment exports,” he said.
US Ambassador to Bangladesh Dan Mozena said Islam’s killing was “an issue of considerable concern.”
“Many companies’ representatives told me about their concerns about buying from Bangladesh,” he told reporters in July, adding that their reputations were at stake because of concerns over workplace safety and a crackdown on labor activism.