Sweatshop

For other uses, see Sweatshop (disambiguation).

A sweatshop in Chicago, Illinois in 1903

A sweatshop is a working environment with very difficult or dangerous conditions, usually where the workers have few rights or ways to address their situation. This can include exposure to harmful materials, hazardous situations, extreme temperatures, or abuse from employers. Sweatshop workers are often forced to work long hours for little or no pay, regardless of any laws mandating overtime pay or a minimum wage. Child labor laws may also be violated.

Although often associated with poor developing countries, sweatshops may exist in any country. Sweatshops have existed in several different countries and cultures, including in the United States. Sweatshops usually employ low levels of technology, but may produce many different goods, for example, toys, shoes, clothing, and furniture.

Some economists such as Paul Krugman and Johan Norberg defend the existence of sweatshops. They argue that people choose to work in sweatshops because the sweatshops offer them substantially higher wages and better working conditions compared to their previous jobs of manual farm labor, and that sweatshops are an early step in the process of technological and economic development whereby a poor country turns itself into a rich country.

Social impact

While East Asia has embraced large numbers of sweatshops, sub-Saharan Africa has not. This graph shows that the percentage of the population living on less than $1 per day (adjusted for inflation) has fallen substantially in East Asia, while remaining relatively unchanged in sub-Saharan Africa. The graph shows the 1981-2001 period. Data source: "How Have the World's Poorest Fared Since the Early 1980s?" by Shaohua Chen and Martin Ravallion. [1] Table 3, p. 28.

When asked about the working condition in sweatshops, proponents say that although wages and working conditions may appear inferior by the standards of developed nations, they are actually improvements over what the people in developing countries had before. It is said that if jobs in such factories did not improve their workers' standard of living, those workers would not have taken the jobs when they appeared. It is also often pointed out that, unlike in the industrialized world, the sweatshops are not replacing high-paying jobs. Rather, sweatshops offer an improvement over subsistence farming and other back-breaking tasks, or even prostitution, trash picking, or starvation by unemployment. This is the case since most under-developed countries have weak labor markets and little (if any) economic growth.

The absence of the work opportunities provided by sweatshops can quickly lead to malnourishment or starvation. After the Child Labor Deterrence Act was introduced in the US, an estimated 50,000 children were dismissed from their garment industry jobs in Asia, leaving many to resort to jobs such as "stone-crushing, street hustling, and prostitution." UNICEF's 1997 State of the World's Children study found these alternative jobs "more hazardous and exploitative than garment production."

Critics point out that sweatshop workers often do not earn enough money to buy the products that they make, even though such items are often commonplace goods such as t-shirts, shoes, and toys. However, defenders of such practices respond that critics of sweatshops are comparing wages paid in one country to prices set in another. In 2003, Honduran garment factory workers were paid US$0.24 for each $50 Sean John sweatshirt, $0.15 for each long-sleeved t-shirt, and only five cents for each short-sleeved shirt – less than one-half of one percent of the retail price. Although the wages paid to workers in Honduras would hardly be enough to live in the United States, it could very well be enough to live in Honduras, where prices are much lower. The $0.15 that a Honduran worker earned for the long-sleeved t-shirt was equal in purchasing power to $3.00 in the United States.

Writer Johan Norberg, a proponent of market economics, points out an irony:

(sweatshop critics) say that we shouldn't buy from countries like Vietnam because of its labor standards, they've got it all wrong. They're saying: "Look, you are too poor to trade with us. And that means that we won't trade with you. We won't buy your goods until you're as rich as we are." That's totally backwards. These countries won't get rich without being able to export goods.

Penn & Teller in their Wal-Mart episode interview Benjamin Powell, a Professor of Economics from San Jose State University, who argues out that sweatshop-type jobs in a developing country are often a significant improvement over other employment options (e.g. subsistence farming) and points out that the United States went through its own period of sweatshop labor during its development.

In an article about a Nike sweatshop in Vietnam, Johan Norberg wrote, "But when I talk to a young Vietnamese woman, Tsi-Chi, at the factory, it is not the wages she is most happy about. Sure, she makes five times more than she did, she earns more than her husband, and she can now afford to build an extension to her house. But the most important thing, she says, is that she doesn't have to work outdoors on a farm any more... Farming means 10 to 14 hours a day in the burning sun or the intensive rain... The most persistent demand Nike hears from the workers is for an expansion of the factories so that their relatives can be offered a job as well."

A 2005 article in the Christian Science Monitor states, "For example, in Honduras, the site of the infamous Kathy Lee Gifford sweatshop scandal, the average apparel worker earns $13.10 per day, yet 44 percent of the country's population lives on less than $2 per day... In Cambodia, Haiti, Nicaragua, and Honduras, the average wage paid by a firm accused of being a sweatshop is more than double the average income in that country's economy."

On three documented occasions during the 1990s, anti-sweatshop activists in rich countries have unintentionally caused increases in childhood prostitution in poor countries. In Bangladesh, there was a closure of several sweatshops which had been run by a German company, and as a result, thousands of Bangladeshi children who had been working in those sweatshops ended up working as prostitutes, turning to crime, or starving to death. In Pakistan, several sweatshops, including ones run by Nike, Reebok, and other corporations, were closed, which caused those Pakistani children to turn to prostitution. In Nepal, a carpet manufacturing company closed several sweatshops, resulting in thousands of Nepalese girls turning to prostitution.

An October 19, 2008 Associated Press article reported on Chinese citizens complaining about how the current U.S. economic crises had caused them to lose their sweatshop jobs. The article quoted Wang Wenming, who had lost his job at a Dongguan sweatshop, as saying, "This financial crisis in America is going to kill us. It's already taking food out of our mouths."

These defenders of sweatshops cite Hong Kong, Singapore, South Korea, and Taiwan as recent examples of countries that benefited from having sweatshops. Critics of sweatshops cite high savings, increased capital investment in these countries, diversification of their exports and their status as trade ports as the reason for their economic success rather than sweatshops and cite the numerous cases in the East Asian "Tiger Economies" where sweatshops have reduced living standards and wages. They believe that better-paying jobs, increased capital investment and domestic ownership of resources will improve the economies of sub-Saharan Africa rather than sweatshops. They point to good labor standards developing strong manufacturing export sectors in wealthier sub-Saharan countries such as Mauritius and believe measures like these will improve economic conditions in developing nations.

Critics of 'sweatshops' argue that the minor gains made by employee of some of these institutions are outweighed by the negative costs such as lowered wages to increase profit margins and that the institutions pay less than the daily expenses of their workers. They also point to the fact that sometimes local jobs offered higher wages before trade liberalization provided tax incentives to allow 'sweatshops' to replace former local unionized jobs. They further contend that sweatshop jobs are not necessarily inevitable. Eric Toussaint claims that quality of life in developing countries was actually higher between 1945-1980 before the international debt crisis of 1982 harmed economies in developing countries causing the to turn to IMF and World Bank-organized "structural adjustments" and that unionized jobs pay more than 'sweatshop' ones overall - "several studies of workers producing for US firms in Mexico are instructive: workers at the Aluminum Company of America’s Ciudad Acuna plant earn between $21.44 and $24.60 per week, but a weekly basket of basic food items costs $26.87. Mexican GM workers earn enough to buy a pound of apples in 30 minutes of work, while GM workers in the US earn as much in 5 minutes." People critical of sweatshops believe that "free trade agreements" do not truly promote free trade at all but instead seek to protect multinational corporations from competition by local industries (which are sometimes unionized). They believe free trade only involves reducing tariffs and barriers to entry and that multinational businesses should operate within the laws in the countries they want to do business in rather than seeking immunity from obeying local environmental and labor laws. They believe these conditions are what give rise to 'sweatshops' rather than natural industrialization or economic progression.

Critics also point to the fact that 'sweatshops' often do not pay taxes and thus don't pay for the public services they use for production and distribution and don't contribute to the country's tax revenue. In some countries, such as China, it is not uncommon for these institutions to withhold workers' pay.

"According to labor organizations in Hong Kong, up to $365 million is withheld by managers who restrict pay in exchange for some service, or don't pay at all."

Furthermore, critics of 'sweatshops' point to the fact that those in the West who defend sweatshops show double standards by complaining about sweatshop labor conditions in countries considered enemies or hostile by Western governments, such as China, while still gladly consuming their exports but complaining about the quality. They contend that multinational jobs should be expected to operate according to international labor and environmental laws and minimum wage standards like businesses in the West do.

Gender and sweatshops

Arguments that sweatshops provide skills and a boost to the economy are sometimes criticized for not taking into account the gendered nature of sweatshop employees. Because of the relatively higher value placed on male education, young women are often encouraged by their families to leave school and migrate to urban areas or Export Processing Zones (EPZ) to work in the garment industry. As outsiders in a new community, these young women lack the legal or family support they might receive in their own community and therefore, have to spend a larger amount of income on supporting themselves. Consequently, these young women who are no longer receiving an education often find it hard to earn enough money to send back to their family.

The division of labour in sweatshops is gendered because the vast majority of workers are young women. The problems faced by many workers are also gendered because gender-based notions of what is acceptable inform working conditions. Thus medical or maternity leave, employer / employee relations and the right to organize can all become gender biased. Consequently, the negative aspects of sweatshops have a disproportionate impact on women. Because of this, some argue that efforts to combat the poor working conditions in sweatshops should focus more on empowering women . Although company-led attempts to improve the working conditions in sweatshops such as the Ethical Trading Initiative (ETI) have had some successes, others criticize the ETI as 'gender-blind' . The modern anti-sweatshop movement combines notions of a living wage, trade unions, and feminism, which some argue makes these grassroots approaches more sustainable.

Current status of sweatshops

Some companies have acceded to

"The income gap between the fifth of the world's people living in the richest countries and the fifth in the poorest was 74 to 1 in 1997, up from 60 to 1 in 1990 and 30 to 1 in 1960. Earlier the income gap between the top and bottom countries increased from 3 to 1 in 1820 to 7 to 1 in 1870 to 11 to 1 in 1913."

Decent Working Conditions and Fair Competition Act

Some recent political action has been taken against sweatshops. In the 109th and 110th Congress, Byron Dorgan (D, N.D.), and Sherrod Brown (D, Ohio) introduced the "Decent Working Conditions and Fair Competition Act" to "prohibit the import, export, and sale of goods made with sweatshop labor". The objective is to crack down on products made in factories overseas where "workers are abused in violation of that country's labor laws." In 2007 Republican senator Lindsey Graham (R, South Carolina) joined them in introducing the bill.

The bills all died in committee. Bill numbers were S3485 and HR5635 for the 109th congress, and S367, HR 1910, and HR 1992 for the 110th Congress.

According to an article by Kristi Ellis in Women's Wear Daily in 2007,

The bill will direct the Federal Trade Commission to conduct an investigation, based on complaints, to determine whether a foreign factory was abusing employees producing apparel and other products in violation of core International Labor Organization standards. If such a ruling were made, the FTC would issue an order prohibiting products from the factory from being imported into the U.S. Each violation of that order would carry a civil penalty of $10,000 in addition to other duties, fines and penalties imposed by the FTC. Customs & Border Protection, a part of the Department of Homeland Security, would be required to enforce the penalties. He added the bill would give American companies the right to sue their competitors in U.S. courts if those competitors were selling merchandise produced in sweatshops.

Related terms

• Assembly line
• Body Shops
• Child labor
• Contingent work
• Corporate abuse
• Economic development
• Emerging markets
• Exploitation
• Export processing zone
• Game sweatshop
• Globalization
• Maquiladora
• Precarity
• Race to the bottom
• SA8000 — Social Accountability Certification Scheme for Manufacturing Industry
• Slavery
• Sweating system
• Trafficking in human beings
• Union Organizer

Organizations working on the issue

• Clean Clothes Campaign international alliance of labour unions and non-governmental organizations
• International Labor Rights Fund
• International Labour Organization a specialized agency of the United Nations
• National Labor Committee founded to combat sweatshop labor and US government policy in El Salvador and Central America.
• Co-op America membership organization based in the United States
• Students & Scholars Against Corporate Misbehavior
• United Students Against Sweatshops a student organization in the United States and Canada
• Woo Harry
• Free the Children A Canadian Organization that helps raise awareness and put a stop to Child Labour - Also helps other children in need.

External links

Activism

• SweatFree Communities– Local Action Against Sweatshops
• United Students Against Sweatshops
• National Labor Committee
• Story about Adidas sweatshops

Shopping

• Responsible Shopper Company Profiles
• "Shop with a Conscience" Consumer Guide