As the time passes by amid the unexpected COVID-19 pandemic leading to global lockdowns and minimal human activities, new situations are emerging every day, some are good, and some are bad for us. While, the world is experiencing an economic slowdown, affecting every sector from finance to hospitality. The Fashion and textile industry is hit hard due to its discretionary nature and the impact on the industry is widely visible. The reason is not only the global shutdown of retail stores or changed customer buying behaviour, but also the halted production, order cancellation and payment delays. Such uncertainties during COVID-19 pandemic are causing a huge impact on supply chain workers inducing loss of pay and enormous layoffs, which the world needs to know.
The picture that is emerging is devastating. Social distancing measures are taken in countries currently most affected by COVID-19 are driving wholesale closure of thousands of garment factories with millions of workers being laid off without a social safety net. As the virus spreads within the garment-producing countries themselves, more factories will be forced to close, putting potentially millions of more workers out of work. – IndustryAll
While scrolling down my google drive images, I re-visited my memories of college days and internships at manufacturing units. There I had worked closely with supply chain workers, “The real heroes” of the fashion industry. From lineman to the quality checker, tailors, masters and even guards, I made some good memories with Thangamma and Yasmeen, which made me write this article to create an awareness.
Since the outbreak of COVID-19 has begun in China at the end of 2019, its impact has been felt throughout the globe, which has led to enforced global lockdown, travel restrictions, social distancing and changed buying behaviour. Such unprecedented scenario has affected the global economy in a hard way, which has created a challenging situation for every sector, many countries are facing multiple crises. After the reassessment of the current pandemic situation, the IMF has declared that we have entered a recession worse than in 2009. Between all this, the fashion and textile industry is hit hard due to its discretionary nature and the impact on the industry is widely visible. The shutdown of malls, retail stores as well as a halt in production is making the retailers as well the manufacturers suffer in a big way.
In the global fashion and textile manufacturing industry, the brands usually make payments after the shipment is made, which is now followed as a standard practice. Sometimes they are even not paid after weeks or months of delivery, instead of immediate payments on placed orders. Thus, when an order is put on hold or cancelled, payment is also delayed or cancelled.
When orders were cancelled, 72.1% of buyers refused to pay for raw materials (fabric, etc.) already purchased by the supplier, and 91.3% of buyers refused to pay for the cut-make-trim cost (production cost) of the supplier. – Centre for Global Workers’ Rights (CGWR)
In response to the global crisis, many brands and retailers are cancelling orders, delaying and even stopping the payments for orders already placed. Not only this, they are also refusing to accept the ready to ship orders or asking for discounts on orders already shipped. This has left factories with no other choice but to destroy or keep hold of ready unwanted goods, which is an overhead cost.
Such poor circumstances and financial implications are creating panic among apparel exporting communities causing temporary suspension of businesses. This has led to inability to pay wages, enormous layoffs resulting into shutdowns and increased unemployment.
As a result of order cancellations and lack of payment, 58% of factories surveyed report having to shut down most or all of their operations. Centre for Global Workers’ Rights (CGWR)
Brands and retailers have been taking such abrupt decision showing no social responsibility for the workers. Brands have abandoned these workers who were solely dependent on them for their daily wages to survive. Asian countries like India, Bangladesh, Myanmar, Cambodia are facing major impacts.
- In India, over 10,000 manufacturing units in Tirupur, which employs over 6 million people, are now struggling to maintain their workforce. Most of the workers here are migrant labourers.
- In Bangladesh, 1 million garment workers have already lost their jobs and if nothing changes, number will shoot up to 4.1 million.
- In Myanmar, approximately 2 million workers have already lost their jobs and many more might lose.
- In Cambodia, it is estimated that roughly one-third of the workers, which is close to that 2 million garment workers, might lose their jobs.
Even though many brands follow the “Responsible exit” policies, all this is happening. For those are not aware, “Responsible exit” policies commit to support factories during such times to reduce the potential adverse impact on workers.
“Poverty is a killer too, and many more people die from poverty than from COVID-19” – Mostafiz Uddin, Bangladeshi garment manufacturer Writing for BOF
There has been no income from the last few weeks and the situation has left these workers in the most vulnerable situation than ever. These people are mostly migrants, or I should say urban poor, with small income, who live their lives on daily wages with little or no savings. Neither they have money to maintain basic hygiene nor they have the ability to stock up on essentials of living to survive during the pandemic. Many workers and families have started to starve unless someone provides them with food.
A survey of migrant workers found that four out of 10 labourers did not have ration left even for one day and 90 per cent had lost their only source of income over the past three weeks due to the lockdown. – Jan Sahas survey
Now, many families do not have money to afford house rents. Migrants want to move back to their villages, where they have families and roof to live in. Nationwide lockdown amid pandemic has made it worse. Many such workers, in India, set out to walk hundreds of miles to return to their villages, carrying a bagful of essential belongings on backs and kids on shoulders, which includes all age groups, from a 6-month pregnant lady to a 60-year-old man. The situation is getting worse!
No one should come out of their homes. Don’t go out into the streets. Stay at home” — Irshad was living on a footpath in Chandni Chowk. – Economic Times
All I want to say is, while we may be stuck indoors, using social media our voices can still be amplified, and who knows, possibly we can make a difference. Many Brands, employers and governments are coming up and supporting the people who make our clothes during this global crisis.
Let’s support a brilliant initiative by Fashion revolution #WhoMadeMyClothes? And request the fashion brands to protect the workers in their supply chain just as they would do for their employees, especially during this unprecedented global health and economic crisis.
I am doing my bit, are you?
There is much more to be say. But for now, I will sign off. I will continue writing my views and some facts on similar lines.
Stay home, stay safe!
COVID 19 Fallout by http://www.crisil.com
Economic-times-7.pdf by castudyweb.com
guidingprinciplesbusinesshr_en.pdf by http://www.ohchr.org