Reports

June, 01 2005 |  Share

If Wal-Mart Paid Pennies More, Millions of Women Could Climb Out of Misery

If Wal-Mart would pay the young women workers in Bangladesh just seven cents more for each garment they sew, these women could climb out of misery and into poverty.

Surely Wal-Mart, the largest company in the world with annual profits of over $10 billion, could afford this. As things stand now, the women are paid just 10 cents for each Wal-Mart shirt they sew, leaving them trapped in misery, living in primitive one-room huts they share with eight other workers.

Tens of thousands of teenage girls sewing clothing for Wal-Mart get up each morning at 5:30 a.m. and clean their teeth with their finger and ashes from the fire, since they cannot afford a toothbrush, which would cost 25 cents, or toothpaste, which costs 51 cents a tube in Bangladesh. Women sewing garments for Wal-Mart can afford to spend just 55 cents a day on food for their families, so their children must go without milk.

Everyone likes a good bargain. But if we knew that bargain was based on young girls forced to work 14 hours a day, often seven days a week, for wages as low as 13 cents an hour and $1.04 a day, would we accept that? Especially since lifting these women workers out of misery would be so simple—and it would cost just pennies!

In Bangladesh, factory management gives the workers a total of 28 minutes to sew a men's long sleeved denim shirt (size large). Even is we base our calculation on the highest wage paid in these factories, 21 cents an hour, the direct labor cost to sew the shirt is just 10 cents. (28 minutes = 46.66% of an hour; 46.66% x $0.21 = $0.097999 ---i.e., 10 cents). If Wal-Mart would pay just seven cents more, these workers could climb out of misery and live with a modicum of decency.

The workers in Bangladesh know they will never live like the middle class in the U.S. They know their country, which they love, is very poor. They are willing to work very hard, 12 hours a day, six days a week. Their demands are extremely modest. The women say that if they could earn just 37 cents an hour they could afford to buy milk for their children and feed their families at least one decent meal a day. Thirty-seven cents an hour might seem insignificant—but it would be a huge step forward for them.

In fact, if Wal-Mart were willing to pay 20 cents more per garment, every single worker involved in producing their clothing in factories across Bangladesh would earn enough to climb out of misery.

This is how the system works:

On average, workers in the U.S. are given 24 minutes to sew a denim shirt. In Bangladesh, taking into account the workers' malnutrition, the long hours and extreme heat, Wal-Mart and its local contractors allow the workers 17 percent more time, or 28 minutes, to sew the shirt. That is the direct labor involved in sewing the shirt. Indirect labor, which is every other operation necessary to get the garment on a rack and ready for sale in Wal-Mart—inspection, pressing, folding, packing, right down to the mechanics who fix the machines—adds 125% more time on top of direct labor, or another 35 minutes. So we know that from beginning to end, including direct and indirect labor, the workers are allotted 63 minutes to complete the shirt. From this we can determine that the total labor cost to complete the Wal-Mart shirt is just 22 cents.

(28 minutes x 125% = 35 minutes; 35 minutes = 58.833% of an hour; 0.58833 x 21 cents an hour wage = 12.25 cents indirect labor; 22.24 cents indirect labor + 9.7999 cents direct labor = 22 cents labor in each Wal-Mart denim shirt.)

Now, if Wal-Mart would only pay the women a barebones subsistence-level wage of 37 cents an hour, so they could live with dignity, this would add less than 20 cents to the cost to complete the garment. Instead of paying 22 cents per garment, Wal-Mart would have to pay 39 cents--just 17 cents more.

(63 minutes is 1.05% of an hour; 1.05% x $0.37 = $0.39.)

For less than 20 cents per garment,--just 17 cents, to be exact—Wal-Mart could lift the 189,000 young women workers sewing Wal-Mart garments in Bangladesh out of misery. Wal-Mart accounts for approximately 30 percent of total U.S. garment production in Bangladesh, which means Wal-Mart has some 283 million pieces of clothing sewn in Bangladesh each year—which is nearly one garment for every man, woman and child in the U.S. If Wal-Mart would pay 20 cents more per garment, it would put $57 million into the pockets of some of the hardest working but poorest women anywhere in the world. Imagine the good this would do.

Are Wal-Mart and the other U.S. companies planning to do this? Sadly, no. Actually it is quite the opposite. According to Fortune Asia (May 16, 2005), "In January, Wal-Mart and the other retailers demanded that exporters cut prices by 12 percent or find themselves without orders." On top of that, Wal-Mart wants its Bangladesh contractors to start paying for "any duties imposed by importing nations," which range between 18 and 22 percent. If implemented, this could lower the workers' wages by over 30 percent. This would bring the current starvation wage of 13 cents an hour down to eight-and-a-half cents an hour. We should not allow this. We do not need such bargains—Wal-Mart's "Everyday Low Prices"—based on the increasing misery of young women all across the developing world.

Wal-Mart and the other giant retailers import 941.7 million garments a year from Bangladesh. If Wal-Mart and the other companies paid just 20 cents more per garment, this would put $188.3 million dollars directly into the pockets of the garment workers in Bangladesh. To put this into perspective: $188.3 million is nearly double total U.S. aid to Bangladesh. If the companies did the right thing, we could lift 1.8 million mostly young women garment workers out of misery, allowing them to climb into a level of poverty where their and their families most basic needs could be met. And if the European companies producing garments in Bangladesh followed suit, this would put $538.1 million into the pockets of Bangladesh's apparel workers. (Europe purchases 1.75 billion garments a year from Bangladesh.)

The vast majority of American people are enormously decent, with a deeply rooted sense of justice and fairness. Most would gladly do the right thing, if they only knew the truth and were presented with a viable option or choice. Our $11 trillion economy is the largest in the world, actually accounting for 30 percent of the global economy. We purchase 40 percent of the world's apparel exports. In fact, in the United States we purchase 16.4 billion garments a year, which means that we buy an average of 56 garments a year per person.

If Wal-Mart and the other companies refuse to pay the 20 cents more per garment, what would happen if we, the people, did? What would happen if WE paid the 20 cents? Twenty cents times 56 garments comes to just $11.20 a year. For just $11.20 each year—less than the price of a large pizza in New York—we could lift the 30 to 40 million mostly young women garment and textile workers in the developing world out of misery. It is very possible. If we have the will, we can change the world.

Many corporations like Wal-Mart want us to imagine that the global economy is like the universe—governed by unchangeable natural laws, giving us no choice but to accept the status quo".After all, we are only tiny individuals. What impact could we possibly have?

But Wal-Mart is wrong. The global economy is not like the universe, it is a human construction, created by human actions--and it can be changed for the better by human actions. The corporations want us to feel powerless and helpless in the face of a global economy which they largely control. Under this scenario, the corporations are free to drive the race to the bottom, pitting workers in the U.S. and around the world against each other, forced to compete over who will accept the lowest wages and benefits and the most miserable living and working conditions.

It does not have to be this way. We, the people, can stop this race to the bottom, and remake our economy with a human face.

Please write Wal-Mart and insist that they pay just 20 cents more per garment to allow millions of women across the developing world who sew their clothing to climb out of misery and at least into poverty. If Wal-Mart refuses—we will find a company that will.

And please keep in touch. Remember, the squeaky wheel gets the grease. If we remain silent, nothing will change. We need to raise our voices.

Finally—Did you know that the corporations have demanded and won all sorts of laws to protect their trademarks and products? —intellectual property and copyright laws backed up by strong sanctions. So, corporate labels, trademarks, products"Nike's "swoosh", Mickey Mouse".All are legally protected by the World Trade Organization (WTO).

The companies say they need these laws to create a level playing field in the global economy, or else everything would descend into sheer chaos.

However, when we ask Wal-Mart and the other companies, "Can't we also protect the rights of the 16-year-old girl in Bangladesh who sews your garment?," they respond, "No. That would be an impediment to free trade." So the trademark, the label, the product are all protected. But not the 16-year-old worker to made it. The companies won't allow it.

This is morally and ethically wrong. And we do not have to let things stay this way. We can demand laws to protect human, women's and workers' rights in the global economy—laws at least a strong as the legal protections now afforded corporate products, intellectual property and financial interests. Winning such protections for the workers who make the products we buy will take a massive, national grassroots campaign.

A draft of such legislation, to protect human, women's and workers rights is on our website. This campaign will be launched in about a month. It is time to hold Wal-Mart and the other corporations accountable to respect worker rights and to pay a wage sufficient to all workers and their families to live with a modicum of dignity.

 

How Can Wal-Mart Sell a Denim Shirt for $11.67?

Wal-Mart Whistleblower Speaks out: Working for Wal-Mart as a Monitor (June 2005)