Garment workers in Bangladesh

Bangladesh has been one of the main beneficiaries of the quota system of the Multi Fibre Agreement (MFA). The rise of the export-oriented Ready-Made Garment (RMG) industry has been a major result of trade liberalisation in Bangladesh. The industry currently employs 1.5 million workers, the majority of whom are women. It has been a major source of employment for rural migrant women in a country that has increasingly limited rural livelihood options, and where women migrants have been largely excluded from formal work in the cities.
The growth of the industry has been promoted through: (a) the introduction of international quotas and the associated phenomenon of quota-hopping which supported the transfer of production and marketing expertise from Korea; and (b) the adoption of national export-oriented strategies which put direct export incentive schemes in place and simultaneously encouraged foreign direct investment through the establishment of Export Processing Zones (EPZs). While 5% of the several thousand export-oriented factories in Bangladesh are joint ventures based in EPZs (‘bideshi’ factories), 95% are ‘bangla’ factories set up outside EPZs -- many by those Bangladeshi entrepreneurs who were trained as management staff in Korea.
Women workers offer a low-cost and compliant labour force that allows the garment industry to compete in the global market. In spite of Bangladesh’s ban on trade unions in the Export Processing Zones (EPZs), the EPZ’s working conditions seem to be superior to that of other factories, but only 12% of the garment workers are employed there. EPZ and ‘bangla’ firms in Dhaka that deal more directly with international buyers are more susceptible to pressures to abide by labour codes and standards. Dhaka firms which subcontract, deal with the informal economy and have weaker links with major external buyers are much less susceptible.
This study explores the poverty implications of the export-oriented garment sector by undertaking a comparison of women workers in the export garment industry and those working for the domestic market. This allows an assessment of the benefits accrued from the liberalized economy versus the non-traded sectors. The 1322 women workers surveyed come from: (a) EPZ garment factories; (b) non-EPZ export-oriented garment factories; (c) self-employed workers; and (d) non-garment workers supplying the domestic market.
With the exception of EPZs which employ better off women and pay the highest wages with the best conditions, the garment export industry has directly benefited women from the poorer section of the rural population through employment opportunities. This has reduced marginalisation of women who were previously excluded from formal sector jobs and confined to a limited number of occupations. Many of these women have entered the workforce for the first time rather having come from other sectors. Dhaka ‘bangla’ factory garment workers were able to contribute to their own and other family members’ basic needs. Though they earned less than self-employed women, they earned higher than the “other” wage group outside of the garment industry. Remittances from garment workers also created redistribution from city to countryside and helped to raise the status of women in their families and communities.
However, the export-oriented garment industry does not represent an unambiguous improvement in working conditions compared to the rest of the economy. It has a high turnover rate. These women are a source of exploited labour and work intensely for a period of time and then move on, only to be replaced by a continuous supply of young women from the country side. The health toll and conflicts with married life makes the garment industry unsustainable over the long run. Nevertheless, those who become well-off have the opportunity to start their own businesses later, and women have been able to change their role as dependents in an unprecedented manner through the growth of the garment industry. This has created a more visible significance of women as economic contributors to their families.
Prior to the phasing out of the MFA, there were predications that up to 2 million women garment workers could lose their jobs, both through an absolute decline in markets and through technological upgrading in an attempt to compete (which would result in a transfer of jobs from women to men who have greater access to skills training). However, in defiance of predictions, the mass layoffs have not materialized and, in fact, since the lifting of quotas, garment exports from Bangladesh have grown by half a billion dollars, with most of the increased sales in the US market.
Naila Kabeer and Simeen Mahmud, ‘Rags, Riches and Women Workers: Export Oriented