The garment industry exemplifies the challenges of global manufacturing: low wages, "flexible" contracts (or no contracts), and poor working conditions. Informal garment and textile workers, a huge workforce in some countries, are often invisible — especially those who work in their homes. But garment workers are organizing, and policy gains are being made.
Complex Global Chains and Cheap Labour
The garment industry has grown rapidly in recent years, as prices have dropped and variety has increased. To keep costs low and production levels high, firms in developed countries outsource garment production to developing countries, while those in developing countries move production within and between countries to find the cheapest labour.
While garment production offers much-needed investment and employment in poorer countries, competition requires “poorer countries to offer the cheapest workers and the most flexible (unregulated) conditions” (Delahanty).
The workers--mostly women--and small enterprises who count on the work have little power or security.
- Meet a group of garment workers in Thailand who turned the fight against global value chains into a new business and a big win: The World’s Most Invisible Workers Plan to Revolutionize Labor for Millions (by Carlin Carr in Next City).
A "Global Assembly Line"
Modern production and distribution of garments has created “the global assembly line” (Carr, Chen and Tate 2000).The rise of giant discounters (low price, high volume) and big retailers has placed even greater demands on manufacturers to lower costs and deliver quickly. Power has shifted from producers to traders and retailers.
Global production and trade are controlled by relatively few corporations. Large retailers, marketers, and manufacturers use decentralized production networks through which they order the goods and supply the specifications—often with just a click. Tiered networks of contractors produce the finished products for foreign buyers. Buyers set the terms for what is to be produced, how fast, and at what price.
Home-Based Workers Bear the Burden of Cheap Production
To compete, manufacturers often outsource production to those who work at home, which shifts the burden of production costs from the manufacturer to the worker. These costs eat away the very low piece rates that homeworkers earn. A recent WIEGO study found that sub-contracted garment workers:
- in Ahmedabad, India, earn between US$0.43 and US$4.32 per day, but most earn under US$2.00;
- in Lahore, Pakistan, most earn between US$0.25 and US$5.21, but many earn under US$1.00.
Workers reported that if they ask for better wages, they are told the work will be given to someone else.
Learn more about the invisible garment workforce in this blog by Sally Roever, WIEGO's International Coordinator.
Analysis of Purchasing Practices: Case Study Turkey
Some apparel retailers have voluntarily adopted ethical practices that improve conditions for their workers. However, as a WIEGO project showed, codes are not enough without a deep understanding of the value chain A WIEGO project with the Ethical Trading Initiative (ETI) examined the working conditions in a Turkish factory that produced garments for a UK-based retailer of high fashion. Although the retailer was committed to ethical practices, the project found its buying decisions were made with little awareness of how they impacted working conditions. Competition at the top of the chain and a race to the bottom on price affect those at the very bottom of the chain most negatively. Learn more about this research and its positive results.
How can international brands ensure that homeworkers are treated fairly? (ETI's Leadership Series) by Marlese von Broembsen, WIEGO’s Law Programme Director (2018)
Types of Garment Workers
Workers experience important differences depending on whether they work in large factories as core or contract workers, for small units, or as subcontract homeworkers. There are also self-employed garment makers who produce for local customers or markets.
Homeworkers do paid work for firms/businesses or their intermediaries, typically on a piece-rate basis, within their own homes. Estimates suggest that as much as 60 per cent of garment production, especially of children and women’s clothing, is done at home in both Asia and Latin America (Chen, Sebstad, and O'Connell1999).
Women represent a significant majority of the homeworkers who cut and stitch garments together for the global apparel trade.
Contract Labour in the export garment sector is widespread in a number of countries, including Bangladesh, India, Pakistan and Turkey. A demand for lower prices, shorter lead times, and seasonality all drive the high and increasing reliance on contract labour (Chan 2013). Chan indicates suppliers also rely on labour contractors due to:
- poor regulation of labour contractors
- financial incentives from labour contractors
- increased access to suitable labour
- reduced transaction costs
- ability to restrict worker organization and collective bargaining.
Contract Labour in Global Garment Supply Chains by Man-Kwun Chan (2013)
In many countries, the garment industry is the largest employer in manufacturing. However, garment workers are often informally employed and home-based─thus invisible and rarely represented in national statistics (Chen, Sebstad, and O'Connell 1999).
In Thailand, the garment industry is the largest export industry, accounting for 60 per cent of total exports (NSO 2012). A survey by the National Statistics Office found that, among subcontracted workers, about half of non-agricultural home-based employment was related to garments and textiles (NSO 2007). Thailand’s Office of Homeworker Protection (OHWP) estimated there were over 950,000 homeworkers in 2005, the majority women. HomeNet Thailand believes the number could be as high as 2 million.
In Bangladesh the garment industry is the principal export earner for that country. In the late 1990s, it employed an estimated 350,000 workers in formal and semi-formal employment, making it the fourth largest employing sector (Bajaj 1999: 19). Although there are no estimates on the number of home-based garment workers, the Bangladesh Home Workers Association (BHWA) believes there are millions of home-based garment workers, as entire rural families are involved in traditional embroidery work (Bajaj 1999: 19).
Garment workers around the world, especially those who do the basic stitching of children’s and women’s garments, are predominantly women. Also, the vast majority of homeworkers are women.
According to statistics in Chen, Sebstad, and O'Connell 1999, women accounted for 87 per cent of homeworkers in Argentina, Germany and Hong Kong, and over 90 per cent in Japan and Mexico.
But often, some of the higher-skilled tasks such as cutting are often done by men. And where products require higher technical skills to produce, women have been squeezed out of garment manufacture by men, who have more opportunity to learn the new skills (Carr, Chen and Tate 2000).
Export factories tend to hire young women before they are married or become pregnant, and let them go once they are.
Many garment factory workers are immigrants or migrants; while once migration was commonly from rural to urban centres, these workers now cross borders in search of employment.
In developed countries, many garment workers – whether working in factories or from their homes – are immigrant women from Asia or Latin America. In Los Angeles, USA, most garment factory workers are from Latin America and (less so) Asia. In Toronto, Canada, most of the garment workers are Chinese immigrant women who worked in small factories before the North America Free Trade Agreement (NAFTA), but now work from their homes.
In developing countries, notably in China, many garment factory workers are migrant women from rural areas.
Driving Forces & Working Conditions
In 2012, the Informal Economy Monitoring Study, coordinated by WIEGO, explored realities for informal workers, including home-based workers. In Bangkok (Thailand), Ahmedabad (India), and Lahore (Pakistan), garment workers participated in surveys and focus group discussions.
Reasons Women Choose This Work
For poor women, producing garments at home is an important source of income. In the IEMS study, women in all three cities said they needed to earn income but also be home to carry out child care and other domestic duties.
In the IEMS sample in Ahmedabad, garment work was mainly done by Muslim women (95 per cent), who noted social constraint against going out for work was a main reason for working from home.
The Demands of "Flexible" Work
Contracting in the garment sector relies on “flexible” production, which results in uncertain and often rushed work. Manufacturers underbid each other for orders from the large retailers, who demand low-cost production and just-in-time delivery and who, aided by bar-code technology, have adopted “lean retailing” to keep inventory as low as possible (McCormick & Schmitz 2001).
The location of work, the volume and duration of work orders, and length and terms of employment contracts are all “flexible.” Garment workers on this “global assembly line” tend to be recruited under “flexible” contracts: hired during peak seasons and laid off when demand slackens.
Low Wages, No Benefits
Most homeworkers in the garment and textile industry are paid by the piece (according to how many items they produce), earn very little, and do not receive overtime pay. Most receive no sick leave or paid vacations.
Subcontracted homeworkers have little power over the terms and conditions of their work. In Bangkok, 60 per cent of subcontracted workers in the IEMS study reported that wages were set by the contractor; 51 per cent said they could not bargain.
By hiring homeworkers to do the labour-intensive work of assembling garments and paying them by the piece, subcontractors keep their wage costs and overhead low, and minimize the risk of loss associated with uncertain orders (Carr, Chen and Tate 2000).
A study conducted by the Worker Rights Consortium between 2001-2011 across 15 countries found garment workers' wages declined overall. Read more.
IEMS findings on earnings confirmed low incomes
- In Ahmedabad, the average monthly turnover (gross earnings before deducting any input costs) for the study’s garment workers was 2,337 rupees (about US$42). They reported working over 23 hours in the week preceding the survey.
- In Bangkok among self-employed garment workers, the average daily turnover was 845 baht (approx. US $28) for a seven-hour day. Subcontracted garment workers, however, worked nine hour days and received just 264 baht (US $9).
- In Lahore, home-based garment workers had an average monthly turnover of 10,525 rupees (about US$110) if they worked in the peripheral areas. However, in central parts of the city where competition is much higher, turnover was much lower at an average of 3,315 rupees (less than US$35) per month. The mean daily working hours for the garment workers were 19 hours/week in the central parts and 16 hours/week in the peripheral areas.
In addition to low piece rates, homeworkers – who have to cover many of the costs of production, including workplace, equipment, and utilities – often are not paid on time, and sometimes must wait months.
Vulnerability to Economic Slowdowns
Home-based garment workers in the IEMS were directly affected by larger economic trends such as the global recession. In Ahmedabad, for example, global recession had a significant and lingering impact on the garment sector. Many garment workers had no work for months and work volumes remained low in 2012. Almost half said work orders had decreased over the last year.
Also, there is evidence to suggest that contract labour prevalence in garment manufacture increased following the global financial crisis in India (both north and south) and possibly in Bangladesh (Chan 2013).
Economic crises exacerbate poverty and risk for garment workers. HomeNet Thailand found that during the economic crisis in the late 1990s, the garment industry in many Asian countries declined, piece-rate wages and job orders dropped dramatically, and payments were delayed while costs rose (HomeNet 2002).
Electricity shortages and load-shedding have had severe effects on the livelihoods of home-based garment workers, especially in Pakistan. A majority of IEMS respondents in Lahore reported that when shortages occur, they cannot work. Reduced production reduces the ability to meet daily food requirements, so they must work harder and longer hours when electricity is available to complete their orders. If they cannot get their orders completed, the intermediary gives work to others instead. Many workers have shifted to manual machines, so that they can work in daylight to complete their work.
In Ahmedabad, too, costly and unreliable electricity caused home-based garment workers to use manual sewing machines, which produce lower-quality products and are more costly to maintain. Users complained of resulting pain in their legs, a need for painkillers and rest, as well as increased noise that disturbs children’s sleep.
For home-based garment workers in the IEMS study, small and inadequate housing was a major problem. A small house hampers productivity as a worker cannot take bulk work orders as she cannot store raw materials. Work is also interrupted by the competing needs of other household activities.
Poor quality housing was also problematic. In all three IEMS cities, women reported that monsoon rains force them to suspend or reduce production. Equipment, raw materials or finished goods get damaged when roofs leak or houses flood.
Transport issues also emerged as significant for homeworkers in the IEMS study. Since the women must travel to obtain raw materials and supply produced goods, increased public transport costs and travel distances impact the viability of their enterprises. Across the IEMS survey sample, transport represents around 30 per cent of total expenditures for a home-based workers’ enterprise. About one quarter of the sample who spend money on transport actually operate at a loss.
The garment workers who rely on public transport in Ahmedabad spend an additional 379 rupees US$7) more per month—a significant sum, given their meagre turnover.
Occupational Health and Safety
Home-based garment works rarely have appropriate protective equipment and may be unaware of safety measures. Health risks in the garment industry include repetitive strain, dust from cloth pieces and, in the case of some dyes, exposure to poisonous chemicals (Laungaramsri 2005). Family members can be equally at risk of exposure due to shared living and working space. Garment workers who participated in the IEMS study in both India and Pakistan said they suffer from backache and eye strain.
Invisibility and Lack of Oversight
Global value-chain analyses often shed little light on the working conditions of garment and textile workers. The major chains and retailers can be unaware of how many homeworkers are actually involved in fulfilling their orders, or may turn a blind eye to the working conditions of this segment of their workforce (Carr et al. 2000).
More on WIEGO’s work in the garment sector.
Policies & Programmes
ILO Home Work Convention (C177)
An international Home Work Convention (C177) was approved by the International Labour Conference in 1996. C177 calls for national policies to promote equality of treatment between homeworkers and other wage earners. It also specifies areas where such equality of treatment should be promoted, including inclusion in labour force statistics. See the full text of C177.
Around the globe, home-based worker organizations have advocated for their national governments to ratify and implement C177. But 20 years later, only 10 countries had ratified it; most are Eastern European - the European Commission adopted a recommendation calling on all European Union governments to ratify the convention in 1998 (McCormick & Schmitz 2001).
Legal Protection in Thailand
In Thailand, a rising global demand for cheap, labour-intensive goods spurred regional competition and put pressure on Thailand's manufacturers to cut costs. Casual employment and subcontracting to homeworkers was a strategy to circumvent labour laws and lower costs (Doane 2007).
HomeNet Thailand, with support from WIEGO and other partners, campaigned for more than a decade to win legislative protection for homeworkers. Both the Homeworkers Protection Act B.E.2553 and a social protection policy came into force in May 2011. The law mandates fair wages –including equal pay for men and women doing the same job – be paid to workers who complete work at home for an industrial enterprise.
The Kathmandu Declaration
The Kathmandu Declaration addresses the rights of South Asian home-based workers. It was adopted in 2000 by representatives of South Asian Governments, UN agencies, NGOs and trade unions from five countries at a regional conference organized by the Self-Employed Women's Association (SEWA), UNIFEM and WIEGO and supported by the Aga Kahn Foundation Canada.
WIEGO commissioned the research findings on which the Kathmandu Declaration was based.
Limitations of Policies
Having policies in place, however, is only a first step. In the Philippines, for example, the specific rights of homeworkers have been recognized since 1992. However, the existence of progressive labour laws does not guarantee their enforcement, as the passage below shows:
An interview with a manager in a relatively low profile firm in the Philippines that makes both garments and textiles … offered an interesting perspective on law enforcement.
To cut costs, workers are often required to put in extremely long work hours at low pay (for example, five drivers must do the job that normally would take 10 drivers, and they have to work 12, 18 or, on occasion, up to 20 hours straight if necessary to get the job done). This also applies to the young, female garment workers (as well as the male managers and others). It is possible to demand this amount of overtime because, in a situation of widespread poverty and a very thin job market, there are always others who are willing to do this type of work if someone refuses to do so.
Garment workers and other employees in these factories are not unionized, and they do not receive minimum pay. They have no benefits (the manager says that they have too little income to want to contribute to social security).
Organization & Voice
Garment workers, especially those home-based workers who engage in the lower skilled work of ready-made garment production, have little if any bargaining power. They may deal only through an intermediary and have no contact with the main contractor, and the intermediary may also have little power. Where homework is illegal, its participants are even more vulnerable (McCormick & Schmitz 2001).
Most garment workers are not organized. Given the competitive pressures throughout the chain, manufacturers prefer their suppliers to be anti-union. In export processing zones, garment factories typically do not allow unionization. And evidence suggests union leaders were among the first to be let go in East Asia’s garment industry when the financial crisis hit in the 1990s (Delahanty 1999).
Garment makers need to organize to increase their bargaining power and with it, their security in this globalized trade (Carr, Chen and Tate 2000). Worldwide, there are examples of how organizing is improving the situation for these workers. Despite the challenges in organizing home-based workers, there are a growing number of organizations as well as national and regional networks of such organizations (called HomeNets).
In India, the Self-Employed Women’s Association (SEWA) is the oldest and largest trade union of women in the informal sector, and garment workers have always been a significant part of it. SEWA has worked to organize garment workers, concentrating on higher piece rates and fairer working conditions. In 1986 SEWA negotiated a minimum wage for garment stitching. Through meetings with the Labour Commissioner and staged rallies, they have helped garment workers demand better wages, working conditions, the provision of identity cards and social protection such as child care and health benefits (Chen 2006).
SEWA’s efforts have targeted industrial outworkers, many of whom are Muslim. In addition, SEWA has helped own account workers compete through training and loans for improved equipment that can help them try to compete in the fast-changing local garment market (Chen 2006). This has included loans for improving sewing machines, training at the National Institute of Fashion Technology (NIFT), and installing electricity in the homes of SEWA members (Inclusive Cities n.d.).
Meet a home-based garment worker in Delhi who is a member of SEWA.