“Profit is always a social theft of value produced by workers, a value that workers produce but never receive. Capitalism is, at its core, a system based on unpaid labour.”
A few days ago, I bought a dress from H&M which cost around £15 from the sale, and the label read, ‘made in Pakistan.’ There was another dress which I bought from Zara, (£24) and the label said, ‘made in Myanmar’. My trajectory of thoughts made me ask these questions, I am here in the developed world wearing clothes made by factory workers from the developing world and even my own home country, Pakistan, do these workers really know anything about these brands such as Zara and H&M? do they know the products they create are sold in high end markets in the developed countries bought by the privileged class who have little or no idea who the real creators of those products are and in which working conditions these beautiful clothes are made? This observation inspired me to write about the conditions of factory workers from Asian markets who are the real producers of these global apparel brands. This essay is an attempt to analyze the concept of ‘work from the perspective of the global majority for whom waged employment is not the norm’ through a case study of factory workers based in Asian markets, who faced ‘wage theft’ during the Covid-19 pandemic.
Recently an extensive report was published by the ‘Asia Floor Wage Alliance (AFWA)’, which is a pan-Asian labor rights group. The report titled ‘Money Heist Covid-19 Wage Theft in Global Garment Supply Chains’- explored the impact of ‘wage theft’ during the Covid-19 pandemic in the six major Asian countries -India, Pakistan, Indonesia, Sri Lanka, Cambodia and Bangladesh, where factory workers are the major producers of garments for the world’s largest fashion brands (H&M, Zara, Adidas, Next, etc.,). Wage theft’ is a term used in global garment supply chains- where there is an in-balance of power between multinationals, suppliers and workers, consequently, it enables extreme exploitation of the labor in the global South. Legal complaints are being filed against these multi-national clothing brands for violation of human rights during the pandemic – many factory workers in these Asian countries were either denied access to their wages or there was a shortfall and gap in the wage delivery, due to cancelation of orders by these multinationals who subcontract their production to the suppliers in the Asian markets (global commodity chains). According to the report generated by AFWA, this resulted in poverty and precarity of millions of garment workers across Asia. The report suggests- these global apparel brands along with their suppliers in the Asian markets, should be considered joint employers of these factory workers under international law, legal complaints have already been filed in India and Sri Lanka. The core takes away from that report emphasizes on the fact that these global fashion brands have total economic control over the whole production process, thus they should take joint liability of their workers and be tried for alleged ‘wage theft’ in major garment producing countries.
One could then argue, how this abstract macro level process of the world economy is related to the precarity and suffering of factory workers from the global South- stitching clothes for these multinational clothing brands? These multinationals from the global North often put strict conditions and unreasonable demands to their suppliers from the global South who cater to multinationals that produce high end consumer goods. These conditions result in creating difficulty in supplier’s production process which in turn put factory workers at the disadvantaged end- over time work and exploitation of the labor. This systematic exploitation of the factory workers is a direct result of the conditions put forth by multinationals, often in the form of international business standardizations – one of the conditions is the imposition of delivery on demand by global brands which suppliers are bound to implement- known as ‘buffering policy’. On demand delivery condition means- the finished product should be ready and stored in the warehouses at the supplier’s end, only to be sent when the customers of these global brands require them. Moreover, suppliers from the global South created a policy to accommodate up-to twenty percent increase and decrease to their client’s demand, and the cost of this twenty percent margin rests on the suppliers’ shoulders, even in case of storage or waste of the finished product and raw material. This is how multinationals make huge profits, through outsourcing their production, they externalize the costs which could incur from the fluctuating market demands, putting all risk burden on the supplier’s end, which disrupts their internal working and production efficiency in case of any loss. When we look at the global supply chain mechanism- and if we combine the measurement of wages and productivity, the countries who are the major participants in global labor value chains (India, Indonesia, and China) have very low labor costs. Low labor costs and high productivity is observed in the data from these countries from the global South- which implies higher profit margins for the global North apparel brands, there is an unequal exchange.
The question arises- why do the suppliers from the global South, provide production services to the multinationals, when there is an asymmetrical power relation between them? With lack of business opportunities in their own country (no social security or benefit from state) they had no option but to get exploited and make money even by remaining at the disadvantaged end. The paradox of precarity under neoliberal capitalism is that “the only thing worse than being exploited is not being exploited” (Denning 2010). Asian garment production countries have relied on global apparel supply chains as a pathway to economic growth and development for the past several decades to generate employment and provide wages that would lift millions of wage dependent populations in Asia out of poverty.
Focusing on the report of Covid-19–related wage theft in the global garment supply chains released by the ‘Asia Floor Wage Alliance’
“Factory owners in Pakistan denied more than $85 million in wages to 244,510 workers from a sample of 50 industrial units in the name of order cancellations and non-payment for existing orders from global brands. About 81pc of the workers were pushed below the World Bank-determined poverty line, measured at $3.20 a day on a purchasing power parity basis, between March and May of 2020.”
Similar statistics were observed in the rest of the countries from the global South, the table below indicates the impact of wage theft by global fashion brands on poverty and debt across Asian garment production countries like Bangladesh, Cambodia, India, Indonesia, Pakistan and Sri-Lanka.
Image source: Asia Floor Wage Alliance
These workers with an average five years of work experience- they couldn’t even sustain for a month without reducing consumption, taking debts, or selling their own assets. One garment worker at a Tesco supplier factory in Pakistan said, “They were given 2000 PKR (12 USD) as a compensation after being laid off, later she worked in a retail shop which gave them 5 PKR (0.032 USD) per piece, her kids were taken out of school to work with her.”
Another man who worked for an Adidas supplier factory in Faisalabad Pakistan said “I worked in a factory for three years, after I was terminated in May (2020), no social security or severance benefits were provided by the factory. I started working as a daily wage worker in another garment factory, which pays around 500 PKR (3 USD) for a 10-hour work shift. He took debt to pay the medical bills of his ailing father, later he sold his cow to pay back the debt”.
“I tried to commit suicide soon after I was laid off in May, as I was four months pregnant and had no money to feed myself or my two other children. I have removed my children from school, as I could not pay for their books or their school fees. In October, I had to take on more debt to meet my pregnancy related expenses. As repaying this debt became difficult, I asked my 15-year-old son to find work in some neighbourhood shops.” - pregnant worker who was laid off without wages from a Levi’s supplier factory in Pakistan
“I have been buying food on credit since April, so that I can save some cash to send to my family. I also pawned the only gold necklace I have in July… At least, if the company paid us for our overtime work, life would not have been this difficult.” - worker from a Next supplier factory in Sri Lanka who was forced to perform unpaid overtime work
On similar accounts of exploitation by global clothing brands- Uniqlo one of the largest apparel maker by their value, the wealth of the company’s CEO had reached $25 billion in 2018, within same period when the company made huge profits, two thousand workers from Indonesia who produced Uniqlo products were laid off without giving any sort of severance benefits or wages. Uniqlo suspended their contract with the supplier in Indonesia due to quality issues as stated by the brand, which reinforces the idea on “how the global production manipulates and reconfigures difference” (Shakya, 2018). Zara or its parent brand Inditex sells one of its product ‘Respect’ hoodies at an average price of 27 euros, it profits approximately 4.20 euros (pre-tax) on each hoody. “The wages of all the workers involved in production – from the cotton fields in India to the spinning mill in Kayseri, central Turkey, to the factories in Izmir where the hoodies are sewn and printed – totaled an estimated 2.08 euros which is less than half of the profit that Zara makes.”
There is a need to deconstruct the restrictive frameworks of ‘commodification’ and ‘Third world’ - that position certain populations at the forefront of ‘development’ and ‘progress’ and confine others to the waiting room of history. These global fashion brands when confronted about the ‘wage theft’ often deny that they have a joint legal obligation to compensate the losses incurred by the factory workers who sew their garments, that put workers from the global South at a vulnerable position. This asymmetrical process in which corporations from the global North exercise control over the global South labour, reinforces that the ‘decentralization of power’ within global supply chain is a fallacious claim. Our present global economic system thrives on the inequality between the global South and global North with later in a commanding position, this pattern is not an organic consequence of ‘globalization’ rather a new form of imperialism.
What if labour costs become high in these Asia markets, would the living standards in the global North remain maintained? This reminds me of the words by one of my Marxist professors. “England is rich because India is poor.” Lastly, going back to the argument at the start of this essay, buying from these apparel brands like Zara and H&M, I feel equally complicit in the exploitation of the labor from the global South, however I am working on reorienting my choices with a hope to come out of this vicious cycle of commodification.
Campbell, Stephen. 2018. Border capitalism, disrupted: Precarity and struggle in a Southeast Asian industrial zone. Ithaca, NY: Cornell University Press.
Millar, Kathleen. 2018. Reclaiming the discarded: Life and labour on Rio’s garbage dump. Durham, NC: Duke University Press.
Shakya, Mallika. 2018. Death of an industry: The cultural politics of garment manufacturing during the Maoist Revolution in Nepal. Cambridge: Cambridge University Press.
Smith, John. 2016. Imperialism in the Twenty-First Century: Globalization, Super-Exploitation, and Capitalism’s Final Crisis. United States: Monthly Review Press.
Standing, G. 2016. The Precariat: The New Dangerous Class. London: Bloomsbury Academic
“Money He$t Covid-19 Wage Theft in Global Garment Supply Chains”, Asia Floor Wage Alliance, July, 2021.
Sonia Gulzeb Abbasi is originally from a superb village of KPK Province in Pakistan, she was also born in a mountainous city known as Murree -which was a former British Administrated summer resort (1876). From Bioinformatics to International Relations to Anthropological research - the curiosity to find puzzled pieces of our colonial past and maybe add a wee bit of contribution from a native’s perspective. Sonia finds time in her busy schedule to climb mountains, nowadays she is in London, dismantling the white privilege at school with grace (literally).