GENEVA, Switzerland — November 18, 2013 — Improving working conditions in Bangladesh’s ready-made
garment (RMG) industry is crucial for achieving sustainable growth in the country, says a new
report Bangladesh: Seeking better employment conditions for better socioeconomic outcomes, prepared
by the ILO Research Department in consultation with the ILO’s tripartite constituents in
Bangladesh.

According to the report, Bangladesh experienced relatively high economic growth over the past
two decades, mainly due to garment exports. The country accounted for 4.8 per cent of global
apparel exports in 2011, compared with only 0.6 per cent in 1990.

But unregulated industry growth has contributed to poor working conditions in that sector,
which have acted as an obstacle to sustainable development and, moreover, resulted in some of the
worst industrial disasters on record.

For example, Bangladeshi garment sector workers earn some of the lowest wages in the region.
As of August 2013, the monthly minimum wage for entry-level workers in the garment sector was US$39
per month – about half of the lowest rate in other major garment-exporting countries, such as
Cambodia (US$80), India (US$71), Pakistan (US$79), Sri Lanka (US$73) and Viet Nam (US$78).

While some other countries revise their minimum wages on regular basis, Bangladesh has
adjusted the RMG minimum wage only three times since it was first set in 1985 – with the last
revision dating back to 2010. A wage board constituted this year is expected to make
recommendations for a minimum wage increase shortly.

Recent accidents have brought the issue of occupational health and safety risks in the
Bangladeshi garment sector to world attention, including a factory fire in November 2012 that
killed 117 workers and the collapse of a building housing several RMG manufacturers in April 2013
that killed 1,129 workers – the latter being one of the worst industrial disasters on record.

Although the government has taken some concrete action in the past six months to address
health and safety issues, poor conditions remain a challenge in many factories across the country,
especially those in the RMG sector.

According to national estimates, poverty has declined but as of 2010, 76 per cent of the
population lived on less than US$2 per day – the highest share in the region.

Furthermore, Bangladesh’s social protection coverage is among the lowest in the region. In
2010, less than ten per cent of all urban poor had access to social assistance.

Moving forward

The report warns that unless a comprehensive set of labour market and social policies are
introduced, Bangladesh will be unable to maintain its economic momentum and improve living
standards in a sustainable way. And while the RMG sector is central to the economy, new measures
need to be far-reaching.

First, improving employment prospects and working conditions – notably in the RMG sector –
will help to safeguard exports, which have been a key driver of growth and employment creation,
especially for women.

It will also help to stop the outflow of Bangladeshi youth who face some of the highest
recruitment fees in the region and are often confronted by abuse at the hands of employers in
receiving countries.

Second, there is an urgent need to strengthen wage-setting policies, notably through the role
of effective minimum wages. In this respect, it will be important to monitor the recommendations of
the tripartite Minimum Wages Board, which is scheduled to submit its proposal by November 2013.

Third, it is crucial to tackle informality. The working-age population has grown at a rate of
more than 2 million people per year over the past two decades but formal job creation has averaged
only 200,000 per year in the past 10 years. As a result, the incidence of informal employment
increased from 75 per cent in 1999/2000 to 87 per cent in 2010 – the highest in the region.

Finally, women have made an important contribution to development in Bangladesh, as well as
to the modernization of rural society and agricultural production. But a number of important gender
disparities persist, notably in terms of educational attainment, labour market outcomes and working
conditions.

“ILO technical assistance will be key in achieving these goals. The Ready-Made Garment Sector
programme launched by the ILO and the Government of Bangladesh last month will lead to lasting
improvements in working conditions and safety for the tens of thousands of garment factory workers
in Bangladesh,” ILO Deputy Director-General for Field Operations and Partnerships, Gilbert Houngbo,
said.

According to Houngbo, the next challenge will be to coordinate the ILO-sponsored RMG
programme, the Sustainability Compact adopted by the European Union and private sector initiatives
like the Accord on Fire and Building Safety in Bangladesh and the Alliance for Bangladesh Worker
Safety.

Among other findings the report says that:

• Between 2000 and 2010, when GDP growth averaged nearly 6 per cent, the employment rate fell 1.7
  percentage points, to stand at roughly 67 per cent in 2010.
• In 2010, the gap between the youth and adult employment rates stood at roughly 20 percentage
  points; it has risen further in recent years. More troubling is the fact that unemployment
  increases with educational attainment.
• Bangladesh is one of the world’s largest recipients of remittances per year. In 2011, it
  accounted for 10.8 per cent of its GDP or US$12 billion – a five-fold increase compared to a decade
  ago. Meanwhile, the annual outflow of Bangladeshis overseas increased four-fold. The prospect of
  higher earnings appears to be a main pull factor.
• Bangladeshi migrants pay some of the highest recruiting fees in the region — the average cost
  per worker going abroad is 4.5 times higher than the annual GDP per capita.

Posted December 3, 2013

Source: ILO

COLUMBUS, Ga. — November 15, 2013 — Swift Spinning, Inc. (“the Company”) is pleased to announce
that it has sold 100% of the Company’s stock to an Employee Stock Ownership Plan (“ESOP”) as of
October 24, 2013.  An ESOP is a federally regulated retirement plan under ERISA that invests
in the stock of an employer on behalf of its employees.   Under the plan, eligible
employees will earn shares of the Company’s stock over time.  As a result of this transaction,
there will be no changes in the company’s management, client services, operations or business
strategy. 

Swift Spinning has been in the textile industry in Columbus, GA since 1906 manufacturing
high-quality 100% cotton ring-spun yarns for the hosiery, niche/specialty weaving and knitted
apparel markets.  The company has approximately 300 employees all located in
Columbus.   Management believes it is the talent, commitment and passion of our people
that drive the success of the Company.  The ESOP allows the Company to acknowledge the
employees’ contributions to the Company’s success by investing more deeply in our employees. 
Further, management feels that the employee ownership will be a meaningful competitive advantage
for attracting and retaining talent in the manufacturing environment. 

Research has shown that an ESOP has an overwhelmingly positive effect on the company,
fostering an environment in which everyone understands his or her role in helping the company
achieve its bottom line.  The result, on average, is stronger companies, more innovation and
more jobs.

“It is extremely rare for a manufacturing company to be in business for more than 100
years.  In addition, it is even more unique for that company to have remained in the same city
and produced the same product for those 100 plus years” said Trey Hodges, President and CEO. 
“This would not be possible without the hard work and dedication of our employees.  I am glad
to see that this gives us the ability to keep the business in Columbus and the opportunity to
reward those employees who have contributed to our success.   I believe this is a win-win
situation for all the employees, the local community and, of course, our customers.”

For additional information, please contact Charles Harp, Vice President of Human
Resources:  charp@swiftspinning.com.   



Posted December 3, 2013

Source: Swift Spinning             
        

It seems that the status quo in the Bangladeshi textile industry hasn’t changed that much. However,
the increasing pressure from some international nongovernmental organizations (NGOs) through social
media and newspapers has caused some changes in the minds of the responsible people in this
country.

Important Industry Sector …

The same pressure comes from the International Labor Organization (ILO), which just presented
a study on Bangladesh focusing on growth with equity, titled “Seeking better employment conditions
for better socioeconomic outcomes.” The big study takes into consideration that the textile sector
in general, and the apparel sector in particular, is one of the pillars of the country’s gross
domestic product (GDP). As the study reports: “Average annual GDP growth rates rose from an average
of 3.2 percent in the 1980s to 4.8 percent in the 1990s and then to 5.8 percent in the past decade.
This improved economic growth performance stems from a series of economic reforms carried out in
the late 1980s and early 1990s in an effort to achieve economic integration with the global
economy, mainly through the intensification of export-oriented production.”

… Specializing In Apparel

With its increased specialization in the apparel sector, ILO reports the country became “one
of the main exporters of ready-made garments (RMG). As a result, in 2011, Bangladesh accounted for
4.8 percent of global apparel exports, compared with only 0.6 percent in 1990. Over the same
period, total exports as a share of GDP increased from around 5 percent in 1990 to over 23 per cent
in 2011. Even during the financial and economic crisis, exports remained rather resilient, only
falling by 2 percentage points at the height of the crisis, i.e. between 2008 and 2010. This was
mainly due to the fact that consumers in the advanced economies substituted towards lower-priced
apparel goods.”

Growth At Any Price …

“The growth in the last two decades has created jobs, but with harsh working conditions and
low pay, including in export-related industries,” ILO reports. “This expansion has brought a lot of
problems in the country, with two fatal events: first, in November 2012, a factory fire in which
117 workers died; and second, in April 2013, the collapse of a building that housed a number of RMG
manufacturers, leaving 1,129 workers dead.” The rest is history. This year, the Rupp Report has
informed in different articles about the severe labor conditions of the textile workers, the
unacceptable housing situation and their implications on the global textile industry. Promises have
been made here and there; however, not many things have changed since the Rupp Report started this
series earlier this year
(See ”
The
Rupp Report: Cheap Textiles Paid For With Human Lives,”
TextileWorld.com, April 30, 2013).

… But With Low Wages …

The ILO further reports: “Bangladeshi workers earn some of the lowest wages in the world. For
example, as of August 2013, the monthly minimum wage for entry-level workers in Bangladesh’s
garment sector was US$39 per month — about half of the lowest applicable rate in other major
garment-exporting countries, such as Cambodia (US$80), India (US$71), Pakistan (US$79), Sri Lanka
(US$73) and Viet Nam (US$78). And while other countries revise their minimum wages on an annual
basis, Bangladesh has adjusted the RMG minimum wage only three times since it was first set in
1985.”

… And No Social Protection

“Bangladesh’s social protection coverage is among the lowest in the region. Even among the
poorest quintile, less than 40 per cent are covered by social assistance. Urban poor tend to be
left out of social assistance,” the report continues. “In fact, a large fraction of social
assistance goes to non-poor households. (close to 10 percent of the social assistance spending goes
to the richest quintile).”

What Is One To Do?

The ILO gives some suggestions for how to get out of this virtually vicious circle: It
writes: “The most important objective of labour market and social policies in Bangladesh in the
short run should be to focus on improving employment prospects and working conditions at home. If
concrete measures are not taken in this direction, the country risks losing its main source of
export-led growth — namely, the RMG sector. For example, the United States recently suspended trade
privileges for Bangladesh (breaks on tariffs under the Generalized System of Preferences of the
WTO), other countries could follow suit. The severity and frequency of industrial accidents in the
sector has increased to the point that it may be acting as a deterrent to international buyers and
investors. The establishment of a National Tripartite Plan of Action on Building and Fire Safety in
the Ready-Made Garment Sector (NAP), negotiated during a high-level mission by the ILO to Dhaka
after the Rana Plaza building collapse, and the ‘Accord on Fire and Building Safety in Bangladesh,’
signed by international retailers and trade unions could begin to address these challenges if they
are fully and promptly implemented. The objective of these agreements is to ensure a safe garment
sector where workers can work without fear of fire, building collapse, or other such accidents.”

Relocate Production Sites

Furthermore, the ILO writes: “There is an urgent need to inspect all existing factories in
the RMG sector. As the ILO’s high-level mission to Dhaka pointed out, some of the factories will
need to relocate to safer buildings while the existing ones are being inspected and repaired to
ensure safety and reliability. … [M]any factories in Bangladesh are unprepared to deal with fire
or other potential dangers. The National Tripartite Committee established to carry out the NAP will
establish a technical sub-committee to focus on the structural integrity of buildings and fire
safety.”

The study also mentions the need for a strengthened capacity by the Bangladeshi government to
inspect the factories: “The ILO negotiated agreement calls for 200 labor and factory inspectors to
be appointed by the end of 2013 and the recruitment of another 800 inspectors in 2014; the
upgrading of the Department of Chief Inspector of Factories and Establishments to a Directorate
with an annual budget to run its regular activities; and the necessary infrastructure for its
proper functioning.”

International Standards

Most of all, as the ILO states: “The country should adopt international labor inspection
standards, particularly allowing inspectors to initiate civil proceedings against violators.
Countries in the region such as Indonesia, Malaysia and Vietnam, where the inspectors are trained
and can initiate civil proceedings and levy fines against violators, could serve as models for
Bangladesh.”

As mentioned above, compared to other major RMG exporting countries, Bangladesh has the
lowest wages in that sector. “Wage adjustments in recent years have remained infrequent and
unpredictable. In the interim, inflation erodes the purchasing power of workers’ wages,” the ILO
reports. As the past few months revealed, “In the garment sector, in particular, adjustments are
usually adopted only after mass protests and strikes that disrupt the industry. Both workers and
employers would gain from more regular and predictable revisions that bring wages in line with
workers’ needs and industry standards world-wide,” the ILO concludes.

Pressure Needed

The list of suggestions could be easily extended. However, as has been demonstrated in the
past months and years, all the suggestions and advice don’t help if there is no strong pressure
from the outside world. There is an old saying: “People only start to move when it hurts their
wallet.” In the very end, it is only the market that dictates success and failure. On the one hand,
the big purchasing companies should put more pressure on the local governments instead of sticking
their head in the sand and proclaiming “this is not our business.” They shouldn’t squeeze the local
producers, but should pay fair prices and communicate with their customers about all these
problems. Then, perhaps, all those people from Main Street and the NGOs shouting against the
retailers would stop canting their accusations. It is exactly these people who are buying the
cheapest apparel, which is produced by workers earning US$39 per month.

November 26, 2013

Berghaus, a United Kingdom-based performance apparel, footwear and equipment manufacturer, has
selected New York City-based Alvanon Inc.’s AlvaForm technical fit mannequins to help it
standardize the sizing and perfect the fit and design lines of its men’s and women’s clothing.
Berghaus initially will supply the full-body fiberglass forms to its product development and design
teams at its headquarters and then to its office in Hong Kong and its international supply base.

Alvanon created its EU series of AlvaForms from 3D body scans of more than 50,000 20- to
40-year old men and women in France, Germany, Holland, Italy, Russia, Spain and the United Kingdom;
as well as from World Health Organization and National Health data from 17 other European
countries.

The AlvaForms supplied to Berghaus will feature the Berghaus logo. They also will feature
collapsible shoulders and hips and removable left legs, shoulder caps and arms; and will have soft
bellies to represent the yielding properties of the human waist.

November 26, 2013