Facing outcry after a garment factory collapse killed more than 1,000 people, a Bangladesh government panel followed through on its promise Monday to raise the sector’s minimum wage. Pending the Ministry of Labor’s approval, it will mean workers earn a minimum 5,300 takas ($66) a month, a 77 percent increase over the current $38 wage. That still makes Bangladesh’s garment workers among the worst-paid in the world, according to the Associated Press, and falls short of the $100 wage workers have demanded.
Poor wages is prevailing issue in most of the largest garment exporting countries, where workers make about or under one-third of a living wage in parts of the world like China, Indonesia, and Vietnam. At the $38 wage, Bangladesh held the number one spot, paying workers just 14 percent of a living wage. Even its last minimum wage “hike” in 2010 barely kept pace with inflation.
Last month, Bangladesh officials indicated they will ask retailers to cover between 5 and 15 percent of the new costs of the raise. As the second-largest garment industry after China, Bangladesh factory owners feared large retailers would relocate, even though companies would still bear far lower labor costs than in most countries. Large retailers had initially refused to sign onto a plan to upgrade safety standards using the same logic. But one estimate put the cost of upgrades at a mere 10 cents per article of clothing. Since then, 70 large retailers signed onto the plan for safety upgrades, although Walmart and Gap instead proposed a less binding, more limited plan in lieu of signing.
In theory, Bangladesh’s other promise to allow the the sector’s 4 million workers to unionize will make it somewhat easier to achieve better pay and safety. However, officials have already fallen short on that compromise and left dozens of new unions vulnerable to retaliation and harassment.