Truth be told, the unrest in the country's garment sector, which in recent months has spilled over at quite regular intervals onto the streets of Dhaka, that unnerving sprawl of a city that serves as our capital, failed to penetrate the nation's conscience in a meaningful manner. The Bengali's two most cherished distractions, sport (in the form of the World Cup) and politics (following a spate of high-profile arrests), rendered an almost vapid bluntness to the impact of the workers' protests, and so throughout the summer, conversation in most tea-stalls and living rooms, as well as newsrooms, centred around the fate awaiting arrested opposition leaders, or the gradual pre-eminence of Spanish football as the World Cup reached its zenith.
Apart from a customary query about the number of casualties, if any, few were induced into investing much beyond the equivalent of a knowing shrug that said "oh, them lot again."
But there was more to it than that. A dangerous indifference had started creeping into the conscience that had made the country come to regard it as something that does not concern them as one might imagine. The fact remains that the unrest was festering in one of our most strategically important sectors, one that not only earns the lion's share of our foreign exchange reserves, but also has a bearing on our international relations. Its role as a driver of social change, through the emancipation of millions of women, the female labour force which underpins its success, has also been well documented. And it needed addressing.
This makes the government's move this week to raise the minimum wage in the sector a very significant one. By managing to squeeze in the announcement before Ramadan, the government has also managed to keep its promise made in April to do so.
The workers were demanding a three-fold increase, but the government finally settled on a directive to have it doubled, from the pitiful Tk 1662.5 set in 2006 to Tk 3000 per month. Factory owners had fought against the rise, but in the end, they too should be happy (one proposal from their side had offered Tk 2800, although a firmer one had offered only Tk 2200, which would actually have been an erosion in real wage terms, and therefore unacceptable), and must realise that persistently low wage levels could eventually have affected their orders.
This is because corporate social responsibility is all the rage these days in the countries from which they gather their contracts. This means firms like Wal Mart of America, Spain's Indetex, and the Swedish H&M, have to answer to their buyers about labour standards, including rights and wages, in the factories from which they source their wares. Earlier in the year, a group of Western companies had in fact lobbied the government to raise the minimum wage. The recent unrest was nothing if not a final round of campaigning from the workers in the sector to bring the issue back into the limelight, and in the process garner as much attention as possible, not only domestically, but internationally as well. The balance to be struck was a very delicate one. Tk 3000 sounds about right.
Various calculations abound about what effect the various increases would have on the sector. By and large, you would expect the most direct impact of any rise in wages, part of the costs in the sector, to be felt on the profits in the sector, and the price of the product. It stands to reason that the owners of our garment factories, the vanguard of the nouveau riche in our society, can expect to see their incomes dwindle, unless they are able to pass on the rise in their costs onto their buyers. We'll do well to bear in mind that the low cost of labour in countries like ours the prime reason that these factories are located here. The owners' concern that rising labour costs will see orders moving elsewhere is a legitimate one. But that is before you consider that the movement demanding higher wages in garment sectors is now actually a regional one, and we are likely to see wage rises in countries competing with us before long. And before you realise that the hourly labour cost in Bangladesh was already the lowest in the world, according to a 2008 report by Werner International, a textile and fashion consultancy. So it cannot be denied that there was room for the increase.
The fact that foreign buyers had lobbied the government in favour of the increase demonstrates they would be ready to bear at least some part of the increase in costs, and rightfully so. Profits in the industry tend to be high, and that is largely at the expense of its foot soldiers, the millions who toil often thousands of miles away from the ones who use the final product. Bangladeshi owners of the factories must not lose heart at the government's decision, rather they should prepare to bargain harder with their buyers for prices that reflect their costs in a fair manner. And what they get, they should in turn strive to distribute among their workers just as fairly.
|