Clothing and footwear manufacturing is characterised by a globalised “value chain”, in which each phase of production is concentrated in a different region.
Giant retailers in the developed economies make huge fortunes in concert with smaller-scale textile and garment factories, the bulk of them in Asia and other parts of the global South. The factory owners act as junior partners in a global network of profiteering. Far from liberating some of the world’s poorest people, export-oriented development has brought luxury for a privileged few but plunged millions into a vast matrix of exploitation.
Hundreds of millions of workers are involved in making garments in some way, united by an enormous value chain that spans tiny, impoverished farms, large sweatshop factories and the shopping malls of Sydney, Shanghai and New York. At each step, individual capitalists endeavour to squeeze out as much profit as possible for themselves.
There is a fortune to be made. According to one estimate, clothing and footwear are a US$1.55 trillion retail market. Lower down the value chain, industry analyst IBISWorld puts the total wholesale value of manufactured garments at around US$850 billion, a lucrative trade for aspiring capitalists in the global South.
The creation of this wealth begins with the production of fibres such as cotton, jute and polyester, which are turned into textiles to be cut and assembled into garments. Cotton is by far the most popular natural fibre, most of which is produced in China, India, Pakistan, the United States and Brazil.
Brazilian and American cotton is produced by large, mechanised farms. In Asia, it’s a different story. Industry group Better Cotton estimates there are 5.8 million smallholder cotton farmers in India and another 1.5 million in Pakistan. The Discover Natural Fibres Initiative estimates that total employment in natural fibre production, including part-time and seasonal workers, is a staggering 300 million people.
Smallholding cotton farmers are extremely poor. Indian daily the Hindu last year reported that average income for Indian farmers was A$5 per day. Fluctuations in global prices, which are under downward pressure from mechanised production, can drastically impact farmers’ lives. According to the International Labour Organization, in India children often work on these farms, and many farmers are forced to work as casual labourers to supplement their low incomes.
Polyester, a petroleum-based plastic and the most common synthetic material used in garment manufacturing, is produced and processed in factories in China, Taiwan, India, South Korea and Japan. Production for textiles consumes more than 300 million barrels of oil annually.
Most of the fibres are bought and processed, not by big global brands, but by regional capitalists. Often these bosses directly own both textile weaving and garment manufacturing plants, “vertically integrating” production to cut out the middleman and leave higher margins for the bosses when they eventually on-sell to wholesalers or retailers. The process of turning fibres into usable textiles employs 50 million people in India and more than 150 million in China.
The cutting and assembling of garments are concentrated in the same areas of the world. China produces 52.2 percent of the world’s garment products, other producers being Germany, Bangladesh, Vietnam, India, Italy, Turkey, the United States, Hong Kong and Spain. European exporters, home to high-end brands, are disproportionately represented in value terms, but the bulk of the volume of exports is from Asian countries.
Textile and garment production has a distinctive lack of monopolies. No one retailer controls even a single percentage of global market share, and at the manufacturing stage there is a glut of middle-sized factories. The wide range of suppliers available to multinational retailers creates a ruthless competition for contracts, which in turn creates huge downward pressure on wages and working conditions.
Big companies stock their shelves by making contracts with hundreds, sometimes thousands, of these factories. Swedish retailer H&M, with 4,702 stores in six continents, for example, claims on its website that it is supplied directly by 1,519 factories, concentrated in Bangladesh and China, where more than 1.5 million workers are involved in producing for its range. Hundreds more factories supply it indirectly through textile weaving and dyeing.
Making clothes and shoes is labour-intensive. Workers bear the brunt of the competitive drive of factory owners, who deliberately target oppressed sections of the workforce, such as women and refugees, to keep costs low. Many Syrian refugees work in Turkey, for example, where informal work is the norm and few official work permits have been granted, according to the Business Social Compliance Initiative.
Modern sweatshops break down the work process into simple, repetitive actions to increase the pace of production for each worker. Workers don’t produce clothes so much as parts of them—collars, pockets, sleeves. Over and over. Conditions are often terrible and shortcuts on safety are common, as a spate of factory catastrophes in Bangladesh testifies.
Local bosses and big international retailers work together to ensure a steady supply of orders, backed up by governments eager to expand export industries. In Bangladesh, for example, the Observatory of Economic Complexity estimates that textiles and garments make up 90 percent of exports. Both major parties in the country are thoroughly in bed with the industry; as recently as 2015, almost 10 percent of all Bangladeshi parliamentarians were textile and garment factory owners.
Retailers are in on it too. Helena Helmersson, H&M’s current CEO, cut her teeth in Dhaka, Bangladesh, in the mid-2000s as a production manager overseeing the supply chain. This was a period before even minimal regulatory standards were introduced following the 2012 Tazreen Fashion fire that killed 117 people, and the 2013 Rana Plaza collapse that left 1,134 dead. Today, H&M employs up to 2,000 people to work with suppliers to keep production running smoothly.
Recent workers’ protests, a series of high-profile factory accidents and international criticism have forced some changes to the industry. The old strategy of keeping suppliers at arm’s length to deny the use of sweated labour has been replaced by glamorous sounding international agreements, including a “transparency pledge” that commits manufacturers to disclosing their supply chains publicly. Ultimately, although these agreements represent some progress, they can gloss over the ongoing poverty and hazards faced by garment workers.
Integration of suppliers in the underdeveloped world and major companies in the advanced economies is facilitated by compacts such as the European Union’s “Everything But Arms” (EBA) agreement, which removes all tariffs on imports from the “least developed countries”, incentivising retailers to secure supplies from the poorest countries in the world. Touted as a way to overcome “structural impediments to sustainable development”, in reality such agreements are just another way to enrich the bosses.
In the case of Myanmar, the 2012 EBA agreement signed in the aftermath of the country’s partial transition to democracy helped drive a fivefold increase in the country’s garment and textile exports. Garments and textiles are now the country’s biggest exports, accounting for approximately a third of its total exports, according to the Observatory of Economic Complexity. The EU is the destination for 70 percent of these exports, which supply major brands such as H&M and Adidas.
However, the conditions remain shocking in factories contracted by big companies. Ninety percent of Myanmar’s 700,000 garment and textile workers are young women, a majority of them drawn into urban areas from the countryside as the sector expanded over the past decade. The minimum wage is a meagre US$95 a month, just over a quarter of the Asia Floor Wage Alliance’s estimate for a monthly living wage of US$367.
When the military overthrew the government in February 2021, the industry’s fundamental class divisions were laid bare. Myanmar’s garment factories came grinding to a halt as hundreds of thousands of women workers joined a mass strike wave for democracy. They faced reprisals from bosses and the state alike. Al Jazeera reported last year that supervisors at the GY Sen Apparel Company, which manufactures garments for Irish brand Primark, locked nearly 1,000 workers inside their factory in retaliation for their participation in pro-democracy strikes.
For all the EU’s posturing and imposing of four separate rounds of sanctions on Myanmar’s military government, it has stubbornly refused demands from both Myanmar’s independent garment workers’ unions and the global trade union body IndustriALL to withdraw the EBA agreement, unwilling to impose any restriction that would harm the interests of European clothing retailers.
Adidas, which boasts on its website of its “concern for the well-being of workers in our factories”, admits in its own, publicly available 2022 supply chain report that it still contracts to six Myanmar firms, employing more than 19,000 workers to make clothes and footwear under the dictatorship. Likewise, H&M, which placed a temporary and theatrical pause on imports from Myanmar after the coup, took less than three months to begin ordering from the country again.
Like their counterparts in the factories of Asia, workers in the clothing retail industry in the West are exploited too. They are some of the lowest-paid workers in the developed economies. In the United States, the average weekly income for apparel retail store workers in 2019 was a measly US$314. The Australian Bureau of Statistics identifies retail as having the second-lowest pay in the country.
According to the Australian Bulletin of Labour, women make up 92 percent of the clothing retail workforce. The concentration of women in low-paid industries such as retail is one of the pillars upholding the gender pay gap. Where retail trade unions have attempted to fight for better conditions, they have encountered resistance from global giants. New Zealand news outlet Stuff reported that, in 2019, staff at Auckland and Christchurch H&M stores were suspended for wearing union stickers as part of a campaign to win a living wage.
Despite the industry sprawling across borders and seas, the same dynamic of exploitation is replicated at every stage. Aside from clothes, the end products of this exploitative chain are the capitalists that the industry enriches. Among them are the mid-level capitalists of the global South, who own and oversee the regimented workhouses that churn out cheap clothing. By global standards they might seem insignificant, but in countries such as Bangladesh, where garment workers earn a paltry US$94 per month, their fortunes are staggering.
At the very pinnacle are some of the world’s richest people. Sweden’s richest man is former H&M chairperson Stefan Persson, who boasts a net wealth of US$21.2 billion according to the Bloomberg Billionaires List. His children, simply by virtue of being born, are each worth more than US$1.5 billion. Unlike those who labour in fields and factories their entire working lives to make ends meet, Persson’s kids are free to pursue frivolous ventures, like producing films in the case of young Tom Persson.
They have never picked nor processed cotton and would not know warp from weft; although European CEO magazine reassures its readers that Karl-Johan Persson indeed “spent summer holidays working in H&M stores” before, miraculously, “at just 25 years of age and with very little commercial experience under his belt, he was sitting on the boards of directors of H&M subsidiaries”, before becoming the company’s CEO in a stunning display of meritocratic achievement. As CEO, he was immediately preceded by his father. His grandfather founded H&M in 1947.