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1 Mär 2023

Global: Garment workers face mass layoffs, suspended employment & reduced working hours as suppliers report reduced & cancelled orders from brands amid cost-of-living crisis

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Since 2022, reports have begun to emerge highlighting the impact of the global cost-of-living crisis on apparel-producing countries.

In particular, it has been reported by suppliers in countries such as Bangladesh, Cambodia, Pakistan, Philippines, Indonesia, Turkey, Swaziland, and Vietnam, that there has been a decline in orders from brands, who report the looming threat of recession, high inflation, and a decline in consumer demand in the West, which has resulted in an inventory pile-up. As well as reduced and cancelled orders, which have often already been processed by suppliers, there are also reports of delayed payments, deferred shipments of clothing and offers to lower costs by brands.

This has had a knock-on effect on garment workers, who are now facing reduced working hours, suppliers partially suspending factories and mass layoffs, amid existing difficulties workers face due to rising inflation and the low wages they are paid. Meanwhile, several brands have reported 'better-than-expected' and 'record' profits.