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SOMO Bulletin on Issues in Garments + Textiles - Number 1

In order for labor practices in the garment industry to meet the basic standards set by the International Labor Organization (ILO) and those outlined in model codes of conduct (ex. the codes of the International Confederation of Free Trade Unions and the Clean Clothes Campaign) there has to be the will to implement such standards and the resources to do so. This means money. Garment factory owners around the world complain that their clients do not pay them enough for the goods they produce, and as a result they cannot cover the costs associated with improving conditions. Their profits are so low, they say, that it is impossible to make the changes (more toilets, new ventilation systems, etc) that companies with codes are demanding. They say that they have to keep wages low just to stay afloat. If they raise wages they won't get orders and in the end workers will lose their jobs. Their governments often support them on this point -- they say that minimum wage levels should not be raised or else the industry will leave the country. The companies that place the orders (sourcing companies) say that they also have to stay competitive and keep their costs down, so they cannot pay manufacturers more. And anyway, some add, when they do pay their vendors more, the money is not always spent on improving the workplace or paying workers better wages, it just goes into someone’s pocket. So where does the money go? Increasingly, labor rights campaigners realize that they have to better understand the cost breakdown involved in garment production and where responsibility lies for pricing decision making so that they can push more effectively for changes in the system that currently shortchanges workers. A current priority for researchers and activists in this field therefore is to develop such an understanding and to investigate how the money paid for a T-shirt or pair of trousers, for example, can be better distributed, so that working conditions are improved and workers earn more.


Date May 2003
Responsible organisation SOMO (Centre for Research on Multinational Corporations)

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