May 15, 2013

BANGLADESH: The Government Announced Plans To Increase Wages for Garment Workers

The Wall Street Journal
written by Syed Zain Al-Mahmood
Sunday May 12, 2013

DHAKA, Bangladesh — Bangladesh's government, facing pressure to improve standards in the garment industry following a deadly factory building collapse last month, announced plans to increase wages in the sector.

Workers' groups say the current $38-per-month minimum wage, half of Cambodia's, is barely enough to scrape by on. Following the collapse of the eight-story Rana Plaza, the death toll from which rose to 1,118 on Sunday, tens of thousands of workers have protested on Dhaka's streets for higher pay.

On Sunday, Bangladesh's textile minister, Abdul Latif Siddiqui, said the government will soon start talks with labor groups and factory owners to agree on a new minimum wage for the sector. The increase, he added, will be applied retroactively to May 1.

Wages are unlikely to go much higher. Factory owners, who oppose the hike, say they can't afford to pay significantly more to workers because Western consumers have become accustomed to cheap clothing.

"If we are to pay higher wages, we may have to go to the retailer and say, 'Stop doing 'Buy one, get one free,'" said Abdus Salam Murshedy, co-owner of Envoy Group, a large Bangladeshi garment manufacturer.

Many workers in the sector, meanwhile, say they have no intention of quitting, pay raise or not, due to the lack of alternatives.
Saira Banu, a seamstress from a factory in Rana Plaza who suffered broken ribs in the collapse, says she would like to quit. But Ms. Banu, who is in her 20s, says she doesn't want to return to a previous job as a housemaid, an informal position that isn't covered by a minimum wage and pays about $20 per month.

"I'd like to find alternative work," she said. "But I don't know what I can do."

Bangladesh has built a huge garment industry in the past decade, using the lure of cheap wages to undercut China, which is still the world's largest producer. Today, Bangladesh exports $20 billion in clothes annually to U.S. and European retailers.

The boom, since the early 2000s, has provided jobs for women who previously had few opportunities in Bangladesh's male-dominated villages. Of the 4 million people employed in the sector, more than 90% of workers are female, mostly young people from the countryside.

Rozina Akter, a 21-year-old seamstress who was working at Phantom Apparels, a factory on the fourth floor of Rana Plaza, at the time of the disaster, says the industry offered her family a salvation of sorts, as they faced starvation in her old village.

She attempted to run for a stairwell when the building shook on April 24. Next thing, she was falling down into pitch blackness. Two days later, rescuers pulled Ms. Akter out of the rubble and she is recovering in hospital with a fractured leg. Despite this, Ms. Akter says she's keen to find another factory job.

"I'll go back to work as soon as I get better," said Ms. Akter. "Not all buildings will collapse."

Three years ago, she moved with her parents and four siblings from Gaibandha, a northern agricultural district, to Dhaka, the capital, after their rice fields were washed away by an overflowing river—a common problem in riparian Bangladesh.

Ms. Akter, who dropped out of school in seventh grade to help tend fields, started on the minimum wage, gained skills, and by the time of the accident was making $58 a month.

She works seven days a week, eight to 12 hours a day. Her older sister, who also works in the industry, earns a similar wage, allowing the family to rent a modest two-bedroom house for $64 a month.

"Sometimes I have to borrow to get to the next payday," Ms. Akter said. "But in the village, I'd have to starve."

Bangladesh last increased its minimum garment-worker wage in late 2010, almost doubling the lowest pay. The first minimum wage for garment workers was set in 1994, when the sector came under international scrutiny as foreign retailers began to buy more from the country. It was raised again in 2006.

Workers say that with inflation of 8%, it is hard to make ends meet, and another raise is due.

"These workers sew the clothes that earn the country foreign currency, so they deserve better," said Kalpona Akter, executive director of the Bangladesh Center for Worker Solidarity, a non-profit group.

But workers in Bangladesh, especially those with little schooling, lack leverage to demand higher wages. Other jobs, such as in chemical factories or ship-breaking yards, are viewed as even more hazardous.

"The truth is, there is no other industry that can absorb so many female workers with little schooling or skills," said Ahsan Mansur, executive director of the Policy Research Institute, a Dhaka-based think tank.

Mominur Rahman, a 27-year-old garment worker, fractured his spine jumping for his life from the third floor of the Tazreen Fashions factory outside Dhaka, which burnt down in November, killing over 100 people.

He's still recovering, living off the $1,250 in compensation he said he got from an association of factory owners.

Still, Mr. Rahman says he plans to stick with the industry. Despite 12-hour shifts – sometimes even longer when a big order comes through – the job offers better opportunities than those in his native town, 175 kilometers outside the capital, Mr. Rahman said.

He started in the industry seven years ago on $25 per month, making shirts and jackets. But he quickly moved up, getting a little more pay as he gained experience.

At Tazreen Fashions, which was making clothes for Wal-Mart Stores Inc. WMT +0.36% among others, he was earning $125 a month as a quality supervisor – allowing him to finally put away some savings, about $20 a month.

"If the doctors allow it, I'll start another job, in another factory," he said.

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