A Small Story, But With Large Implications

To be sure, it is a short piece in the part of the newspaper that many readers tend to gloss over, page two. The title, Bangladesh garment workers’ minimum wage boosted, leads one to feel that finally there is a small bit of justice for workers in an industry that has cost so many lives and inflicted so much suffering on woefully underpaid garment workers.

The story reveals that the government of Bangladesh has approved an increase in the monthly minimum wage for entry-level garment industry workers to 5,300 taka ($72 Canadian) from 3,000 taka (about $40). However, the part that gave me pause, the part that spoke volumes about the relationship that exists between companies like Walmart, Joe Fresh and Benetton and the factory owners was this: ... factory owners ... said they would ask retailers to shoulder part of the costs (of the raise).

As we all know, it is common practice in the first world that when production costs go up, those costs are passed on to customers. The fact that the owners in Bangladesh can only express the hope for normal marketplace forces really places scrutiny on all of the big names in retailing to see if their past expressions of sympathy for the plight of garment workers are anything more than sanctimonious platitudes.

Indeed, now is a fine opportunity for Benetton, Joe Fresh, Walmart, etc. to show their true colours.

How Much Do We Really Pay For Those Bargains?

There is a segment in the documentary, The Corporation, where Michael Walker of The Fraser Institute extols how corporations help developing nations by using their labour to make their products. If you watch the video below from 3:15 to about the 6:00 mark, you will hear his explanation:



While the claims made by Walker were nonsense in 2003, when the film was made, ten years later workers are experiencing even more exploitation. As reported in today's Star, based on a report published by the Center for American Progress, despite increasing orders from the West, the wages being paid to third-world workers are getting worse, and no one is receiving anything even remotely approaching a living wage.

Amongst the report's highlights:

Garment workers in Mexico, the Dominican Republic, and Cambodia saw the largest erosion in wages. Between 2001 and 2011 wages in these countries fell in real terms by 28.9 percent, 23.74 percent, and 19.2 percent, respectively.

In 5 of the top 10 apparel-exporting countries to the United States—Bangladesh, Mexico, Honduras, Cambodia, and El Salvador—wages for garment workers declined in real terms between 2001 and 2011 by an average of 14.6 percent on a per country basis. This means that the gap between prevailing wages and living wages actually grew.

Much more information is available through the above links for those interested, but perhaps one of the most important inferences we in the affluent part of the world can draw is that we really are paying much much more than we think whenever we seize upon 'bargain' garments, and contrary to popular corporate propaganda, the lives of those who help us indulge in our cost-saving passions are not being improved as a consequence.