Why Is a Living Wage Essential to Sustainable Fashion?
Garment workers can't meet basic needs. The number of affected people equals the US population, the third-largest country.
The fashion industry is notorious for its exploitative labor practices, and a new report highlights the stark reality of the problem. The Industry Wage Gap Metric for 2023 was launched at an OECD forum, revealing a 48.5% gap between minimum and living wages in major garment-producing countries. This means workers in these countries earn less than necessary for a decent living. The main reason: Fast Fashion.
Fast fashion relies on increasing sales volumes to maximize profits, which leads to over-production, over-consumption, and excessive waste. Addressing the issue of lower prices is crucial to reversing this trend of excess, and to achieve sustainable operations, brands must not only consider their environmental impact but also the wages paid to factory workers.
The Human Impact
Less than 2% of the workers who make our clothes earn a living wage, leaving an estimated 98% of workers in systemic poverty and unable to meet basic needs. Additionally, 75% of these workers are women aged 18-24. With 75 million factory workers in the industry, this is not a small issue – in fact, it surpasses the population of over 220 countries. When accounting for workers’ families, the number of affected people is equivalent to the population of the United States, the world’s third-largest country.
The Financial Impact
Environmental scientist Roland Geyer argues that paying living wages to garment workers is the key to social and environmental sustainability in the fashion industry. By increasing wages for the world’s garment workers by just an extra $100 a week, 65.3 million metric tons of CO2 can be cut out of the global economy due to a reverse rebound effect.
Here’s how the reverse rebound effect works. When something like a carbon tax raises the cost of fossil fuels, people switch to cleaner energy sources or use less energy to avoid the higher cost. This results in decreased overall resource consumption and emissions because there is less demand for the resource or its products due to the increased cost or reduced accessibility.
The Impact on Business
Paying higher wages leads to an increase in product costs and reduced demand, which has two main benefits. Firstly, this would create an additional $84 billion in the global economy through the reverse rebound effect. Secondly, clothing production would require more time and skill, for example, by improving aesthetics, quality, and repairability. Brands can invest in repair and resale businesses, marketing labor-intensive and skilled clothing as climate-friendly and green. Enforcing labor standards and slowing down production could also make fast fashion more humane and sustainable without changing materials.
The Impact on Women
Higher wages in the fashion industry can also address gender and wage inequality. Despite constituting 80% of the workforce, women often face difficulty having their opinions and concerns heard. Fair pay can lift women and their families out of poverty, reducing risks like gender-based violence in supply chains. Neglecting fair pay requirements undermines worker justice and sustainability, even if 50% green materials are used.
The Empowering Effect
Paying a living wage has benefits beyond environmental and social concerns. It can benefit businesses in three ways. Firstly, it can improve business performance by reducing staff turnover, increasing motivation and productivity, and improving worker satisfaction. Secondly, it strengthens the value chain by investing in long-term supplier relationships and responsible procurement practices, leading to improved supply chain performance, transparency, and social impact while reducing labor issue costs. And finally, it creates a supportive and stable operating environment that has reputational gains with consumers and positive effects on local economies.
Geyer’s book offers a positive outlook that by prioritizing humans over material things, economic growth can be achieved. The first step towards this is redesigning products to prioritize humane treatment. From a consumer perspective, embracing the concept of sustainable clothing that pays a living wage would be a significant step forward.
Though raising wages isn’t exactly the “Magic Bullet” he says it is for sustainability in fashion, what’s one consequence of investing in worker well-being and fair wages? It can have a ripple effect throughout the entire supply chain towards more sustainable and ethical practices overall.
 “State of The Industry: Lowest Wages to Living Wages.” Available at: https://www.lowestwagechallenge.com/post/state-of-the-industry
 “Could Living Wages Help Solve Fashion’s Climate Crisis? New Research Says Yes.” Available at: https://www.forbes.com/sites/elizabethlcline/2022/01/17/could-living-wages-help-solve-fashions-climate-crisis-new-research-says-yes/?sh=4fd951146b27
 “Raising their voices for change: women garment workers speak up.” Available at: https://www.care.org/news-and-stories/ideas/raising-their-voices-for-change-women-garment-workers-speak-up/#:~:text=Women%20make%20up%20around%2080,in%20Asia%20and%20the%20Pacific.
 “LFW needs to address garment workers’ wages.” Available at: https://www.drapersonline.com/news/lfw-needs-to-address-garment-workers-wages
 “Fashion: The Business Case for Living Wages.” Available at: https://www.commonobjective.co/article/fashion-the-business-case-for-living-wages
Author: Giuseppe Scandariato
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