Corona crisis makes millions of garment workers unemployed

Corona crisis makes millions of garment workers unemployed: ​‘Big brands have to help them.’

The entire textile chain is groaning under the corona crisis. Western retailers fear bankruptcy, but on the other side of the textile chain, millions of garment workers and cotton farmers are suffering. Many are technically unemployed but lack a social safety net or enough savings to survive.

Article by Sarah Vandoorne from ontketing​.be for Knack Weekend

“We’ve got to get through this.” That’s how my aunt, owner of a fashion boutique in one of the busiest shopping streets in Bruges, reacts when I send her a message.

The wishes are well received. The once busy shopping streets are now – rightly so – completely deserted and will remain empty for some time. This is a disaster for retailers, says Isolde Delanghe of Mode Unie, the sector organisation for independent fashion retailers. She repeats the request to postpone the sales period for a month and speaks of ​‘impending bankruptcies’.

In order to keep turnover going, several retailers choose to sell via webshops or social media. Mode Unie fears that online sales will far from make up for the losses incurred. This is confirmed by Niki De Schryver, the driving force behind COSH, an online platform that lists sustainable shops.” Retailers who are now launching an online sale emphasise that their sales are only 2 to 6 percent of their normal sales in the physical store.”

De Schryver is afraid that sustainable retail in particular will be affected by the corona measures. Pioneers are working on smaller margins, in favor of better working conditions and more sustainable practices in the supply chain. They were less able to build up a buffer than the large chains. I don’t see all sustainable retailers borrowing money just to buy the same amount of new clothing for next season.”

Don’t forget the clothing workers

Corona will have a global impact for sure,’ continues De Schryver. On garment manufacturers, their employees, the brands and all textile suppliers. If we want to use our remaining purchasing power for the economy, why not for sustainable products? So we can shift from miserable jobs to decent jobs with living wages’.

The impact of the corona crisis on stitching manufacturers and their workers is immense. Sector organisations such as Clean Clothes Campaign, Workers Rights Consortium, International Labor Rights Forum and Maquila Solidarity Network emphasize this. These organisations are sounding the alarm because more and more garment factories in producing countries are closing down. This is a disaster for the workers, who often don’t receive a salary in the event of temporary or permanent closure, not to mention severance pay.

We need everyone in the textile supply chain to pay up. Charles Snoeck (Fairtrade Belgium)

In addition to the need for social distancing, the organisations see two main reasons why the closures are taking place. First, the supply was compromised because some of the raw materials used by the manufacturers come from China and deliveries are delayed due to the rise of the virus. Thereafter, demand stagnated: clothing brands are reducing their orders because of the mandatory closures of retailers and declining consumer demand around the world.

Many brands are even withdrawing orders. In Bangladesh, which depends on the textile industry for four-fifths of its exports, textile manufacturers are currently losing almost three billion euros in deliveries, reports the local employers’ association BGMEA. Among others, Primark, which does not sell online, has suspended orders worldwide, withdrawing orders worth $273 million (€249 million). In second place in that list is C&A, which has cancelled orders worth $166 million (€151 million). According to the calculations of the Workers Rights Consortium who is pointing the finger at the brands.

Ordering without paying

According to Human Rights Watch, the major problem lies in the fact that brands only pay for their orders at the time of embarkation of the delivery, and not at the time the order is placed. If an order is suspended or even cancelled completely, it also means that payments are not made. This practice is also denounced by the global trade union 

IndustriALL. Now that retailers in the West are forced to close their shops,’ it sounds cynical, ​‘it is the clothing workers themselves who pay the price for the clothes they have already stitched together’.

Multinationals have for decades benefited from a system in which they could produce in countries with no social safety net.

Sara Ceustermans (Schone Kleren Campagne)

In the meantime brands such as H&M, Zara (through their parent company Inditex), Calvin Klein and Tommy Hilfiger (through their parent company PVH) have announced their intention to pay out their placed orders. Christie Miedema of Clean Clothes Campaign hopes that more brands will follow. Even if it would be crazy not to pay that out, because those orders are just ready to go,’ says Miedema immediately. It’s like ordering a pizza, but as soon as the courier is at the door, you decide you don’t feel like it anyway.

For Sara Ceustermans of the ​“Schone kleren campagne”, which is part of the international Clean Clothes Campaign, it’s clear what brands have to do. Multinationals have for decades benefited from a system in which they could produce in countries without a social safety net. Now it’s up to them to take care of the workers.’

Local trade union women Kalpona Akter in Bangladesh and Tola Moeun in Cambodia say the same. If there are dismissals, clothing brands must provide immediate payments to factories, so that workers receive their full legally owed severance pay,’ Akter (Bangladesh Center for Worker Solidarity) suggests. Workers should be able to stay at home until the situation is manageable,’ adds Moeun (Cambodian Alliance for Labor and Human Rights). It is up to the brands to ensure that they receive their full wages during this period’.

And the farmer, he plowed on

At the source of the textile chain, on the cotton plantations of North America, West Africa, Central and South Asia, cotton farmers also fear that the corona crisis will destroy their yields. ​“The lives of many farmers are at stake,” says Christina Ben Bella of Cotton Made In Africa. On that continent, the harvest has yet to begin.” More than ever, we have to show solidarity with the people behind our textiles and with the environment.”

Central Asian cotton farmers are currently harvesting. Like many textile manufacturers, they already have stock that they can no longer sell. That’s what Charles Snoeck of Fairtrade Belgium says. They are often hired workers who work on large plantations. If they fall without an income, it’s a tragedy for the entire community’.

El Mamoun Amrouk, economist at the Food and Agriculture Organization of the United Nations (FAO), agrees. ​“Cotton plantations are very labour-intensive. The spread of the coronavirus may have an impact on the work on which so many small-scale farmers depend. We remain vigilant with regard to health risks.”

Dat beaamt El Mamoun Amrouk, econoom bij de Voedsel- en Landbouworganisatie van de Verenigde Naties (FAO). ​‘Katoenplantages zijn erg arbeidsintensief. De verspreiding van het coronavirus zal mogelijks een impact hebben op het werk waar zoveel kleinschalige boeren van afhankelijk zijn. Wij blijven waakzaam wat betreft de gezondheidsrisico’s.’

The price of cotton is the lowest in thirteen years prijs voor katoen is het laagst in dertien jaar tijd

According to Snoeck, as many farmers as possible will continue to work, despite all the measures taken. As long as social distancing is possible, cotton production in Asia will continue. Guaranteeing the health of the farmers to the fullest is not evident.” It is a fact that news about new safety regulations is not as easy to seep through in countries like Pakistan as it is in Belgium, for example,’ says Snoeck. Via fairtrade cooperatives we can inform and support our farmers. The Better Cotton Initiative label applies a similar strategy. Our local partners organise information sessions’, says employee Morgan Ferrar. They also hand out materials, such as mouth masks and gloves, to better protect the farmers’.

In addition to health risks, Snoeck sees major problems in the field of transport. ​“It is very difficult to gain access to freight containers to export cotton.” The cotton that is exported now goes over the counter for a bargain price, Amrouk knows. ​“The price of cotton is the lowest in thirteen years: less than a euro per kilogram of cotton.” Figures from the Nasdaq trade fair website show that this is 30 percent less than the average selling price over the last five years. This has everything to do with the lack of demand for any raw material from brands, retailers and consumers’, Amrouk continues. ​“Producers of all kinds of raw materials for textiles are suffering from the crisis. In addition, there is a fabric surplus, because last year more cotton was produced than sold.”

Sustainable future

FAO colleague Christopher Emsden adds that the UN organisation urges governments to accommodate as many workers as possible by providing a (cash) replacement income. Of course it remains a problem to guarantee such an income, not in the least because most workers did not receive a guaranteed salary even before this crisis. Every country and every organisation will have to take its responsibility’.

This crisis shows once again how broken the current fashion system is

Christie Miedema (Clean Clothes Campaign)

According to Miedema (Clean Clothes Campaign), this also includes the brands. ​“We hope that in the future there will eventually be a system in which brands will contribute to the social security of the countries in which they produce. This crisis once again makes it clear how broken the current system is. Hopefully this will teach us that in the future we will have to deal with people and chains in a sustainable way.”

That decision also appeals to Snoeck. ​“We need every link in the textile chain. In the long term, chains will only be as strong as their weakest link. That is precisely why companies that already have an ethical way of working are one step ahead of other brands and companies. Fairtrade cooperatives can play an important social role by protecting our members and employees as well as possible and thus ensuring that they can continue to grow. Otherwise the farmers will have lost all their income.”