4. LOW-INCOME COUNTRIES WOULD LOSE THEIR COMPETITIVE EDGE
The first and most obvious point to make here is that labor costs represent such a small proportion of the cost breakdown of a garment that even doubling them would make only a small difference.
Paying a living wage could even improve quality and flexibility, allowing suppliers to retain a competitive edge.
The labor costs in a typical piece of clothing make up 1 to 3 percent of its retail price.On top of this, it’s not just the cheap labor that entices production to other countries. China is popular not just because of its cheap workforce but also because its industry is very efficient and productive from cotton production to finished garment.
Wage increases have been shown to improve workforce morale and productivity, as well as reduce absenteeism and employee turnover. Paying a living wage could therefore improve quality and flexibility, allowing enlightened suppliers to retain—or even gain—a competitive edge.
5. WE’RE HELPING WORKERS WHO WOULD OTHERWISE BE UNEMPLOYED
It’s true that, for many workers, getting a job at a garment or sportswear factory is better than some of the alternatives—that’s why so many depend on them. The fact that people are desperate isn’t an excuse to exploit them. Workers aren’t getting their fair share of the benefits they are creating for the big companies.
The fact that people are desperate isn’t an excuse to exploit them.
We welcome the fact that millions of people are earning a wage. This alone, however, is not enough to lift them from poverty if employers can hire and fire at will, deny union rights, pay low wages that drive people to work inhumane hours just to survive, avoid paying sick leave, and avoid observing maternity rights.
For many workers, these jobs carry devastating hidden costs, such as poor health, exhaustion, and broken families, all of which are unacceptable and avoidable. Everyone wants and is entitled to a quality job that pays “just and favourable remuneration ensuring for himself and his [or her] family an existence worthy of human dignity,” per Article 23(3) of the Universal Declaration of Human Rights.
Photo by Michael Hughes for ActionAid.
6. THE COST OF LIVING IS LOWER SO WE CAN PAY WORKERS LESS
Of course it’s true that the cost of living in many countries is much lower than in the United States and Europe—that’s why we don’t compare our wage levels with workers elsewhere. We do know from our partners around the world, however, that the minimum wage in each country is never enough to provide a “living” wage for workers and many garment workers don’t even get paid the minimum.
A garment worker in Cambodia has to work two hours to afford one kilo of rice. The same worker in Norway can buy 14 kilos for just an hour of work.
A 2010 report from Norway’s Future in Our Hands revealed that garment workers in Bangladesh and India have to work approximately for three hours to be able to buy one kilo of rice. Garment workers in Cambodia have to work two hours to buy the same amount of rice while in Shenzhen, China, one hour’s work is enough. As a comparison, a garment worker in Norway can buy 14 kilos of rice for one hour of work.
A living wage enables workers to meet their needs for nutritious food and clean water, shelter, clothes, education, healthcare, and transport, as well as allowing for a discretionary income. It should be enough to provide for the basic needs of workers and their families, to allow them to participate fully in society and live with dignity. It should take into account the cost of living, social security benefits, and the relative standards of other groups. This is what we believe each worker should be able to earn within a normal working week and this currently isn’t the case.