GENEVA — Garment factories in Vietnam, Jordan, Haiti, Indonesia and Nicaragua, taking part in the joint International Labor Organization and International Finance Corporation Better Work program, have dramatically improved working conditions in hundreds of factories, enhanced productivity, boosted profits, improved health and safety, and lowered costs, an independent review found.
“Do working conditions improve [in BW factories?] The bottom-line answer, is yes,” Drusilla Brown, Associate Professor of Economics at Tufts University and lead author “Progress and Potential,” an impact evaluation in five countries where Better Work operates, told reporters Monday.
The study, commissioned by the ILO and the IFC, draws on assessment surveys of 15,000 garment workers and 2,000 factory managers. Conducted from 2010 to 2016, the study also found that weekly pay increased $7 after three years in the program, overtime was reduced an average of 3.5 hours after three years and reductions were seen in verbal abuse and sexual harassment, Brown said.
In Jordan, reports of sexual harassment declined 18 percent and incidences of workers feeling fearful declined markedly, as well, the report noted.
In Vietnam, where nearly 6,000 workers and 208 general managers were surveyed, the study found that across all factories tracked, after four years of participation in the program “the revenue-cost ratio increased by 25 percent.”
Similarly, the review found that supervisory skills training empowering supervisors to excel at their work and reduced time needed to reach production targets, “resulting in a 22 percent increase in productivity.”
Moreover, workers in Better Work factories reached production targets 1.3 hours faster compared with the beginning of the program, the review said.
Dan Rees, branch chief for Better Work at the ILO, said since the partnership with the IFC — private sector arm of the World Bank — began in 2009 the program operates in seven countries, including Cambodia and Bangladesh, and engages over 1,300 factories employing more than 1.6 million workers, 80 percent of which are women.
The ILO official said the program examines compliance with labor laws, and provides technical support to understand labor norms and come into compliance over time, and noted in the last five years “we improved working conditions in factories that benefit 3 million workers.”
The review outlines that buyers “also appear to be directing larger orders to firms with better compliance reports, including those with better working time.”
But the independent study critically observed that the push from brands and retailers to achieve lower power production costs to meet consumer demands for cheaper prices “pits garment manufacturers against one another, competing on price and speed in a labor-intensive market.”
As a result, garment factories “may cut corners on investing in a safe compliance workplace and suppress wages in the rush to maximize work hours and productivity.”
Global buyers’ sourcing practices, characterized by “fast fashion,” the Tufts review said, “put factories under pressure to deliver within short lead times, respond to frequent order changes and operate with high levels of flexibility. This has a direct knock-on effect on a factory’s ability to comply with key elements of decent work.”
Another issue of concern, the report said, is that managers in Better Work factories voiced concern about how their main customers’ sourcing practices impacted their business.
“In relation to their most important customers, nearly half of managers responded that uncertain orders, late delivery penalties, changes in technical requirements and defect penalties presented a serious challenge to business success,” the study said.