The Living Wage, Minimum Wage and Replacement of Garment Workers

The buzz on sustainable fashion has been rising and more people are aware about the implications of the fashion industry on the environment. While sustainable fashion is being hailed as the new environmental trend (hopefully it’s more than a fad), it is imperative to think about ethical fashion too. We must think about the garment workers that create our clothes and their incomes. I would like to focus on the following 3 aspects:

• the confrontation of the term ‘living wage’,

• the equitability of a minimum wage, and

• the implications of labour replacement.

Living Wages

Something that has always bothered me is how one decides the baseline for fair wages? The United Nations defines the international poverty line to be US$1.90 per day based on studies done by the World Bank. (The World Bank, 2015) Technically, if someone earns more than that, one is out of absolute poverty. However, there are different cost of livings in various countries and cities, thus US$1.90 may not be the most accurate baseline of a fair wage. Perhaps, fair wages should be based on a county or state level rather than global. These factories can work locally to provide for specific communities rather than fast-fashion. One response by some corporations on the seemingly low wages of garment workers is that what they pay is “the living wage in their country” (or city). Living wages has been defined in many ways:

1. decent work for all, (Somavia, 1999)

2. the idea that workers should be paid a decent wage and not have to live in poverty, (Anker and Anker, 2017, p. 2)

3. or, it is based on the cost of living and is voluntarily paid by … employers who believe a hard day's work deserves a fair day's pay. (The Living Wage Foundation, n.d.)

There are ways to quantify the living wage based on food, childcare, health, housing, transportation, other necessities and level of taxes in the country. (Nadeau, 2017) Through this, we can determine whether a person is paid well. Even then, there are shortfalls in using the term “living wage” as a standard for companies to follow to:

• Different regions in the same country are still subject to different living conditions and costs. i.e. a pair of sports shoes, on average, costs US$46 in Bhopal, but US$60 in Mumbai in May 2019 (Expatistan, 2019)

• The basket of goods compared between different countries may not even be accurate. i.e. rice may be the staple in Asia, but that not necessarily in Europe. Comparing food, for instance, can be tricky and difficult.

• Many studies are done by non-native people. From a more privileged background we are from, there is a tendency to contrast their pay with our own gauge of what incomes should look like.

Hence, we cannot only blame corporations for the seemingly low pay – it is partially the metric itself. Nonetheless, if garment workers cannot even survive with the income even after working the whole day, it is plain to see that the income is simply insufficient. Then, what’s important is a way to liaise between local communities and the employers – official channels within companies, legal clinics, support groups, NGOs, workers unions or taking it into their own hands if possible. This is to ensure that both parties are agreeable on the wages provided by the corporations.

The Wage Providers

Yet, this is not the full picture of a living wage. We need to think from the wage providers’ perspective – the garment factories and corporations. First, we need to establish the costs involved. For garment creators, it is mostly down to the fabric, thread, machines, energy, labour and transport. In general, businesses aim to profit, so they either increase revenue or cut costs. For small-medium enterprises (SMEs) in the textile and fashion industry, they tend to make a lower revenue due to the small-scale operation. Hence, increasing labour wages would make business operations really tough for them. Moreover, there is a minimum number of workers they need to create garments. Below a certain number, they are simply not efficient enough. With the high labour costs and reduced profits, they cannot get efficient machinery or textiles from sustainable and ethical sources. Essentially, the costs are not borne the same for different sizes of businesses.

Minimum Wage

A suggestion is to make these living wages the minimum wage, even a global one. (Marshall, 2019) Let’s establish the differences between a living wage and a minimum wage. A minimum wage is set by the government and is mandated and enforced as a national standard. However, a living wage is mostly based on cost of living and is generally higher than the minimum wage. (The Living Wage Foundation and ACCA, 2017)

So, what happens when the government sets a minimum wage equal to the calculated living wage? The supposed effects are that workers will have “more opportunity to support [their] development and enjoy [their] life”, while most present minimum wages are just created to survive. (The Living Wage Foundation and ACCA, 2017) With a higher income, this increases the amount of money that (garment) workers can spend, specifically education, healthcare and housing. This is great for lifting people from poverty, providing the future generations with the skills to have higher income jobs while keeping them healthy and sheltered.

In theory, a minimum wage should sound amazing, but I do not think it would turn out the way people want. If minimum wage is set above the current equilibrium wage, which is the case most of the time, (Gwartney, Clark and Stroup, 1985) the cost of running businesses become more expensive and hence many companies would retrench workers. Without a job, forget about talking about a living wage for these garment workers. This minimum wage also affects small, medium factories or SMEs more than large corporations as shown in the previous segment. Many SMEs will end up having insufficient manpower to create garments and they cannot survive unless they raise the prices of their clothes they sell. (Card and Krueger, 1995) On the flipside, big businesses have the existing capital due to large profits to invest in mechanisation even with less labour. In the next section, I want to talk about the ways firms respond to a minimum wage with labour replacement.

Labour Replacement

There are many forms of way that manpower is replaced by something else in the textile and fashion industry. One of which is mechanisation and it refers to replacing parts of the production that require manpower with machinery and new technology. In the textile and fashion industry, it would commonly refer to:

• mechanising the agriculture of plant fibres (planting, irrigation, managing and harvesting of crops) (Konduru, Yamazaki and Paggi, 2012)

• replacing sewing with artificial intelligence (AI) (Nayak and Padhye, 2018)

• using printers to replace traditional pattern making on textiles (Couch, 2015)

• having robots to fold and pack clothes (Doumanoglou et al., 2016)

Another way is to choose processes that require less people. For instance, some businesses have started to change textiles to hemp as it is easier to harvest, needs less synthetic fertiliser, pesticide, water, (Cherett et al., 2005) and dye, (Kabir, Karim and Islam, 2017) which mean less workers are required for these processes anyway. Companies also choose to own the full supply chain. (Safe, 2017) Otherwise known as vertical integration, many companies find it necessary in the era of fast fashion. (Saunders, 2018) What this does is that the locations of the farms, the fibre processing plants, garment factories can be near each other (if they so wish) which require less transport and management, (Schmitz, 2017) hence less people are hired. As labour is being replaced by mechanisation and choices that companies make, it can become quite tough to talk about wages at all. What can we do in these cases?

Companies have to be ethical about these processes, meaning the workers should know what companies are doing, the corresponding implications and their exercisable rights. Communicate in a language they understand, preferably by a third party with no affiliation or working relation to the company. Ensure they have the access to other resources like community leaders, legal clinics and so on. Even so, how would people cope with the loss of jobs? It is critical for workers to have a greater diversity of skills to do other jobs. This requires long-term education and short-term retraining to make these garment workers more resilient to the volatility and emerging changes in the industry. (Illanes et al., 2018) Hopefully, they do not simply wait till they’re retrenched before thinking about alternative livelihoods. We need to educate and raise awareness about it here and now.

The Perils

In the face of a minimum wage, something that is not acceptable, though, is neglecting safety to offset rising labour costs. In my opinion, if they are your workers, these are real lives working for you. They deserve to be treated with respect and there should be a level of safety accorded to them. This problem is systemic and the whole industry needs a revamp. In a privileged situation, if I knew how terrible the working conditions were, I would simply say no and find another company. However, for so many of the garment workers, they simply do not have other skills to offer. They cannot turn to other garment factories or other industries. They may be learning new skills that are less susceptible to the replacement of mechanisation and tending to safer jobs, but they cannot learn it in a day and suddenly leave the textile industry. They still need to feed themselves while they learn the new skills. Putting their lives at risk while they are working hard is unethical, wrong and inhumane. They are humans, they have lives and all humans deserve respect.

Personally, I think being unemployed is less bad than the poor treatment of workers. Retrenching workers to me are economical and if you are unemployed, you can find and you eventually will find a job. The job may pay less or you may have to do multiple side jobs, but that is something that you can do and it is not the company directly risking your life. Having multiple jobs and being in a gig economy is also where the major cities, like London (Devlin, 2016), and the world are poised to head towards anyway. Contrarily, poor treatment of workers like forcing them to make more clothes in the same time at the same hourly wage is exhausting them without an equitable salary. The low rent in a worn-down building packed with many workers may be good for profits, but that and the lack of emergency exits and protocols can’t be good for the health, safety and security of the workers. Cutting cost at the expense of these workers – it’s simply not right.

Conclusion

The ethics of the fashion industry must change. The treatment of workers has to change. I think that the fashion industry itself is poised to change with second-hand, upcycled, artisanal, sustainable fashion options popping up more now than ever. Within the fast-fashion industry itself, labour replacement has already been occurring at relatively fast speeds. How will we move forward? What are the new ethical dilemmas that we have to face beyond the living and minimum wage? While we can predict some of them, we probably would never know until the effects reach us.

References

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