How low can you go? Support minimimum wage increase in Bangladesh
Thursday, 21 September 2006 08:54
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Bangladesh wages: Five arguments why garment workers' wages must be increased
`I get Tk 900 for a month of hard labour which is not enough to even cover my food bills,' said a worker at Tejgaon.
`Can you show me one worker who runs his family without a hitch with the money he gets?' asked Sagar, who works in SS Sweater for a monthly salary of Tk 950, .
1. The garment industry has grown enormously since 1994 when the current minimum wage was set and so should the minimum wage
When the minimum wage was last adjusted in 1994 the value of the ready-made garment (RMG) sector was US$1.5 billion, up from $68,000 in 1978. Between 1994 and 2006, this grew to US$7.04 billion, four and a half times the value in 1994. Factory owners are now predicting that the industry will grow even further: "We're confident we can now keep the growth momentum intact and double our exports to more than 15 billion dollars in the next five years," S. M. Fazlul Hoque, president of the Bangladesh Garments Manufacturers and Exporters Association told reporters in Dhaka .
After 25 years of operation the industry is one of the biggest export sectors in the country, making up 75% of Bangladesh's export earnings. Whilst the industry has grown, wages have remained the same, even though minimum wage levels set for garment workers in 1994 were low to begin with, far below the cost of living, and far below wages in other labour/industrial sectors. Garment factory owners and international buyers have profited from the garment industry and seen their incomes rise - workers have not. Garment workers, the poorest players in the industry, should no longer have to subsidize its growth.
2. In real terms, wages have gone down since the last minimum wage was set twelve years ago
Jakir Hossain of Bangladeshi think-tank Unnayan Onneshan, showed at a roundtable on 'National Minimum Wage: Poverty Reduction and Social Justices for Workers' on August 24, 2006, that due to currency inflation and increase in commodity prices the minimum wage should be Tk4,286, if it is to meet the basic needs of workers . In 2005, the Bangladesh government declared a minimum wage of Tk 2450 (basic wages without allowances and benefits) for workers in state-owned industries. There is no reason why garment workers shouldn't get the same wages as other workers.
3. The current minimum wage does not even cover the cost of food for one person
A recent calculation by a Bangladesh NGO states that whilst the costs may vary depending on where a worker works and lives, a single garment worker needs to spend a total of Tk2,150 - 3,350 just to fulfil basic needs:
- Tk350-700 for house rent,
- Tk1,000-1,200 for food,
- Tk200-300 for transportation,
- Tk100-200 for washing,
- Tk150-250 for buying cloths and cosmetics,
- Tk150-200 for entertainment and recreation and
- Tk200-500 for medicine.
According to M. K. Shefali, executive director of Nari Uddug Kendra: `For an adult living in Dhaka city the minimum nutrition requirement for basic living is 1,805 calorie per day. At today's costs of living this means Tk1,400 (US$21.54) per person per month for food alone. Many garment workers (particularly female) do not earn this amount, which is severely affecting their health as well as productivity." The Bangladesh Institute for Labour Services (BILS) conducted a study in summer 2006 into a living wage, which was calculated by the research team in various ways. The main consideration was the minimum cost of living of a family of four, which was calculated to be Tk 4,800 per month .
4. The proposed wage doesn't meet the United Nations Millennium Development Goal to eradicate extreme poverty and hunger and therefore violates basic human rights
One of the United Nations' Millennium Development Goals is to eradicate extreme poverty and hunger. The first target for this goal is to halve, between 1990 and 2015, the proportion of people whose income is less than one dollar a day. A person who is earning less than US$1 a day is considered to be living in extreme poverty without adequate food, shelter, medicine, etc.
By fixing the minimum wage at anything less than Tk2,114 , garment workers will be forced to live in poverty, which amounts to a serious violation of basic human rights. The current Wage Board proposal does not meet this standard, nor does the Tk1,300 proposed by BGMEA
5. Increasing the minimum wage by itself won't make the Bangladeshi garment industry un-competitive
The Bangladesh minimum wage for garment workers is amongst the lowest in the world. Even tripling the minimum wage will still keep Bangladesh garment workers amongst the lowest paid in the world. Indeed improving conditions for workers including wages is essential for increasing the competitiveness of the Bangladeshi garment industry. As the MFA Forum in May 2006 in Dhaka, Bangladesh concluded: "There is now acknowledgement that compliance with national law and international labour standards is a vital component of international competitiveness and the sustainability of the industry".
