Bangladesh Workers Not Letting Up on Minimum Wage Campaign
With the Bangladesh wage board committee due to make its recommendations this month, worker leaders and organizations aren’t taking their foot off the gas.
“As it stands, the current wage structure in Bangladesh’s garment industry is unsustainable. Increasing the minimum wage is a crucial step towards ensuring that workers and their families have the basic resources to survive,” said Arifur Rahman, country coordinator, Asia Floor Wage Alliance (AFWA) in webinar on Tuesday, organized by AFWA in collaboration with Remake, a global advocacy organization supporting workers rights.
More from Sourcing Journal
For Bangladesh, Fuel and Foreign Reserve Crisis Means 'No Light at the End of the Tunnel'
Garment Unions Urge Adidas to Dedicate Some Yeezy Proceeds to 'Harmed' Workers
Reintroduced Bill Wants to Stop Stock Buybacks--Nike's Included
The labor law stipulates a minimum wage increase every five years.
“The last increase was in 2018, so this time in 2023 is being looked at as a pivotal time, after some difficult years of change, post pandemic,” he said.
Worker leaders and organizations in the garment industry which employs more than 4.4 million workers, are calling to triple the present minimum wage of 8,000 taka, or approximately $74 a month at the present exchange rate, to 22,000-24,000 taka or up to $222.30.
“We strongly support the trade unions’ demand for minimum wage increase as it is an important step towards ensuring that garment workers and their families have the basic resources to endure crises, including the impending economic recession,” Rahman said.
Sirajul Islam Rony, president, Bangladesh National Garments Workers Employees League, who is also a representative of the workers on the Minimum Wage Board committee, said negotiations will continue until everyone agrees on 24,000 taka.
“We present all these arguments and after repeated negotiations will reach a decision. I hope at the end of this month we will have a proposal paper so the workers can get a good wage,” he said.
It was crucial that brands and buyers support the workers, he said.
However, with the depleting foreign exchange reserves and tough austerity measures being called for by the International Monetary Fund for its loan granted earlier this year, high energy costs, and a cutback in the global orders, industry analysts told Sourcing Journal that it was likely to be a very tough call.
Speaking unofficially, members of the Bangladesh Manufacturers and Garment Exporters Association (BGMEA) make it clear that it wasn’t for the sake of argument, but layoffs should not be an option, and increasing costs would cause shutdowns and job cuts, which would be the worst possible outcome for workers.
The garment industry accounts for more than 80 percent of Bangladesh export earnings and is expected to earn more than $40 billion in the financial year ending June 30.
With the election looming around December or January, the ruling government would be expected to cater to the voting populace, which means rank-and-file garment workers.
But industry analysts say this is not going to be an easy solution this year, and they don’t know what the minimum-wage outcome will be.
“Taking into account various factors such as housing, food, healthcare, transport, education, and other essential needs, the Asia Floor Wage Alliance (AFWA) calculated the living wage requirement which is 51,000 taka—five times the minimum wage,” said Rahman.
“This is not an exaggeration, it is the real cost of living in this country.”
A study launched on Tuesday with the discussion, titled “Towards a Woman-Centred Living Wage Beyond Borders”, outlined various factors affecting women workers across Asia.
Among the comparisons across countries was that of the living wage, in comparison to the minimum wage, which the report said has declined to 15 percent in 2022, from 19 percent from 2014. Meanwhile, this has gone up to 57 percent in Indonesia, and 50 percent in India.
AFWA’s survey found that most Bangladesh families spend more than they earn in income, even when there are two earners working in the garment industry. On average, the total monthly expenditure of a family was 24,373 taka or $225.77, with food accounting for around 44 percent of spending, and non-food costs—rent, medical expenses, transportation, education, clothing, etc.—for 56 percent. In comparison, the combined actual income of two workers was 21,642 taka or $200.48, highlighting the persistent debt cycle trapping workers.
Comparing statistics across several Asian countries for garment workers, including in Cambodia, Myanmar, Pakistan, India and Sri Lanka, the report said that “the composition of the garment labor force exhibits similarity across Asia, including a high share of temporary, casual, or irregular employment, a predominance of women in the workforce ranging between 70 percent-85 percent, large family sizes or number of dependents, and a lack or inadequacy of social security benefits.” It pointed to a “continued deprivation of garment workers in terms of sustainable wages, economic or social mobility.”
Nutritional statistics were also taken into account. In terms of Bangladesh, nutrition for women workers was also a concern, as they consume “fewer calories than the poverty-level calorie standard set by the government at 1,950 calories at 120 daily instead of the national standard of 2,122 calories per capita,” the report stated.
Minimum wage negotiations are expected to intensify in the coming months.
As analysts in Dhaka noted, the minimum wage negotiation falls on the tenth anniversary of the collapse of Rana Plaza, making the fight for higher minimum wage more meaningful than ever.
