The Center for Global Workers’ Rights (CGWR/Global Workers’ Rights Center) and the Worker Rights Consortium (WRC/Worker Rights Alliance) recently released an import data analysis report. The two US organizations are based on a previously unpublished import database. , estimated the losses of global garment factories and suppliers from April to June this year.
CGWR and WRC pointed out that the main sources of the database for this report include: apparel suppliers and their trade association.
The report pointed out that starting in March, many large European and American fashion brands and companies canceled orders or refused to pay for orders placed before the epidemic due to the epidemic, resulting in global losses from April to June. Garment factories and suppliers lost $16.2 billion. The report pointed out that suppliers in Bangladesh, Cambodia, Myanmar and other countries that were affected had to reduce the scale of their operations or even close their doors directly. As a result, millions of workers have either been laid off or forced to shorten their working hours.
The report points out that the epidemic has exposed the power imbalance at the heart of the fashion industry, that is, the initial production costs are borne by suppliers from economically underdeveloped and even poor countries, while buyers are in factories. Payment is not made until weeks or even months after shipment. Scott Nova, director of WRC and co-author of the report, pointed out: “During the epidemic, the already unfair payment system has allowed Western brands to support their own financial situation by oppressing their suppliers in developing countries.”
Thereportstatedthateventhoughsuppliersandworkersarefacingalife-and-deathcrisis,someretailersstillchoosetospendmillionsofdollarstopayshareholderdividends.InMarchthisyear,theAmericanclothingretailgiantKohl’sdistributedatotalofUS$109millionindividendstoshareholders,weeksaftercancelinglargeordersfromfactoriesinBangladesh,SouthKoreaandothercountries.
TheGarmentManufacturersAssociationofCambodiapublishedanopenletterinAprilthisyear,callingonbuyerstofulfilltheircontractstoprotectthelivelihoodsof750,000Cambodiangarmentindustryworkers.”Allrelevantstakeholdersintheglobalapparelsupplychainareoverwhelmedbytheepidemic.However,comparedwithbuyers,manufacturers(factories)haveslimprofitsandweakerpressure-bearingcapabilities.Intheend,theyarealreadylivingonthesubsistenceline.workers,thelivingenvironmentisevenmoresevere.”
The open letter also pointed out that the total value of canceled orders in Bangladesh is 2.5 billion pounds, and the buyers mainly include Arcadia (Topshop’s parent company), Debenhams, Asda, Peacocks, New Look and Sports Direct are among the clothing retailers’ spring and summer collections.
Data from CGWR shows that more than 1 million Bangladeshi garment workers have been laid off or temporarily laid off because brands and retailers have canceled orders or refused to pay for goods. Although the local government has provided a total of US$500 million in relief funds to factories to reduce unemployment, many reports indicate that Bangladeshi workers have been without income for at least two months.
In July this year, Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association, said that new orders dropped by about 45% compared with the same period last year. . Factories in Bangladesh, the world’s second-largest clothing producer, are operating at half their usual capacity.
Recruitment agencies for apparel companies in Vietnam, a major manufacturer of large sportswear brands such as Nike and Adidas, are also facing difficulties. Recruitment consultant Will Tran told Reuters that he and his colleagues had only signed two hiring orders in April and May, compared with usually as many as 10 orders per person. He said: “So 80 to 90% of the work requirements disappeared with a ‘poof’.”
Director of CGWR Professor Mark Anner, the lead author of the report, pointed out that the financial status of clothing companies has been affected by the epidemic, but they must face due financial responsibilities. “Although being at the top of the supply chain allows (brands and retailers) to renege on their contracts with suppliers when facing a crisis, morally we should protect the weak…The most basic thing is to protect the rights of workers at the bottom of the supply chain. .”
In order to urge brands and retailers to take responsibility, WRC and CGWR launched an “epidemic tracker” in April this year to monitor whether companies have fulfilled their contractual obligations. Arcadia Group, the parent company of British high street brand Topshop, retail giant Walmart, American fashion retailer Urban Outfitters, British maternal and infant clothing retailer Mothercare, etc. have not promised to pay the full price for orders that have been completed or are in production.
In addition, Scott Nova pointed out that under the influence of labor unions and media reports, brands and retailers such as Gap, H&M, and Zara have successively announced that they will pay orders in full. Previously, Japanese fast fashion giant Uniqlo also stated that it would pay for goods as usual during the epidemic.
From September 5th to 25th, the International Textile Federation will issue a notice to its members and related parties. Companies, associations, and others from all over the world conducted the fifth survey on the impact of the epidemic on textile companies. The survey showed that these companies’ expectations for turnover have improved significantly since the fourth survey.
This survey adds for the first time an investigation into turnover expectations from 2020 to 2024. From a global average, turnover in 2020 is expected to drop 16% from 2019. In 2021, The global textile industry is expected to stagnate (-1%). In the following years, companies are expected to report higher turnover than in 2019.
Compared with benchmark Compared with 2019, turnover levels are expected to increase by 9% in 2022, 14% in 2023, and 18% in 2024. It will not be until 2024 that the global textile industry can fully make up for the losses suffered due to the impact of the epidemic in 2020 .</p
