Without so-called “sweatshops”, factory workers would only be worse off – it’s a mantra that Western society has embraced and internalised. You may, at some point, have felt a pang of regret for the horrific conditions that your clothing was produced in. Everyone knows that conditions in sweatshops are bad; we’ve all seen the tragedies, such as the Rana Plaza factory collapse in 2013 and adverse health effects from chemical usage. All are a product of our insatiable desire for cheap clothing, but we continue to buy. As a society, we have justified this all as being the means to a better end and these concerns are quickly soothed by the expert economist, who’ll tell you through that these are necessary for economic growth.
Supposedly there would be higher unemployment, fewer opportunities for women to enter the workforce and less chances for poor agricultural communities to modernise without these sweatshops. They’ll tell you that, if people are employed, spending increases, which, in turn, benefits local and national businesses. The poorest in society will at least have some money to spend and small business owners and industrious entrepreneurs will have opportunities to expand and grow. Economic growth will increase as a result and, as we all know, if the economy is growing, everyone will be better off.
Over time, the economy will continue to grow and get better and, one day, it will be just like ours. Rostow’s development theory outlines how states go through progressive stages of growth, eventually reaching a stage of ‘high mass consumption’, where they can then think about welfare and workforce protection. So really, we should support the fast fashion industry as much as we can. We’re helping these people to live better lives, just like ours.
This is a lie.
There are huge omissions in this explanation of economic theory as well contradicting empirical evidence. It puts forward a false idea of us choosing the supposed lesser of two evils. Most importantly, it misses out the thing that causes the suffering, suppresses change and incentivises horrific working conditions – Us.
There is a tendency, which I want to avoid, of shifting the responsibility to source products ethically from big business and policy regulators to the consumer. Most people do not want to hurt other people. If they could, they would always buy products that help others. But, when you’ve only got a budget of £20 for food each week, choosing between a £4 t-shirt from H&M and a £40 t-shirt from American Apparel isn’t really a choice at all. Furthermore, most consumers (and often even chains themselves) don’t even have access to information about who made their products and in what condition. Indeed, the Fashion Transparency Index rated only 3 of 42 fashion labels as having genuine transparency in the information provided to consumers. However, we do all have to recognise that we are in many ways complicit in a system that causes deep suffering in many developing countries. Low-income consumers may not have the option to spend more on ethical clothing brands, but they do have the power to participate in public demand for accountability.
One popular yet flawed assumption of the argument for sweatshops is that if such factories did not exist, there would be a significant fall in employment. Firstly, people in developing countries are perfectly capable of starting and growing business. Small, locally run businesses are very vulnerable to the competition brought by big international business. Large businesses have cheaper running costs, greater funds, sell cheaper goods and can easily outcompete small businesses. Evidence shows that, contrary to economic theory based on Ricardian comparative advantage, states develop more equally and sustainably while in isolation from Western hegemonic powers. Furthermore, exploitative trading relationships mean that established businesses are forced into a ‘race to the bottom’ in order to attract and maintain trading relationships. Factories in developing countries will not get business if their costs are higher than factories elsewhere. The documentary ‘The True Cost’ outlines, through interviews the struggle of factory owners in attracting business as they are consistently pushed to lower costs. Furthermore, regional competition leads to cases of both international and interregional race-to–the-bottom. Thus, the presence of large multi-national corporations (MNCs) in developing countries contributes in itself to the suppression of development and entrepreneurship.
Moreover, the argument does not account for the fact that a significant proportion of profits made by MNCs are repatriated – with a surge in repatriation of profits to the US, following the Tax Cuts and Jobs act. While a small amount of money trickles back into the economy through wages, most of the benefits of businesses are brought back into the wealthy, developed nations from whence they came.
Secondly, if costs of production rise in one region or country, companies tend to simply shift production to another. This causes policies in developing countries to be geared towards attracting big business, policies which can reduce growth or hamper development opportunities. These are policies such as low or no minimum wage, low corporation tax and few regulations or health and safety requirements. This is not the fault of developing nations. There are simply no other options but to play to the interests of big business. If production moves elsewhere then regions are simply left without prospects – not dissimilar to regions of the UK, still suffering from the closure of factories and mines in the absence of education and diversification programs.
Thirdly, even if economies grow, it’s unlikely that the poorest in society will benefit. Clothing prices have deflated overall – which is significant considering the undeniable trend of inflation in almost every other sector. This is not because of increasing efficiency; it is only a result of worse conditions, which allow for cheap and compliant labour. The conditions for workers in these factories are not improving, if anything year on year they get worse.
There is a better option. Fundamentally problems with transparency in firm’s supply chains, abuses of the workforce, MNC capital flight, lack of consumer information and lack of punishment for abusive companies are all things that be legislated against. However, for such legislation to be enacted, we need to make this issue get onto the political agenda. If fast-fashion brands are held accountable, they will be forced to change. Legislation needs to be put in place to regulate the conditions under which the goods we buy are produced – not just agreements, but actual laws which incentivise businesses to produce responsibly or face real criminal consequences. This is not a question of what is possible, merely one of our society’s priorities. However, it requires us to stop accepting false arguments that frees us of any guilt and demand changes in legislation to hold businesses accountable.
Kassidy Dawn is a second year PPE student at the University of Warwick