Fair Trade and the Living Wage

by Olivia Bowen At Gaeia, we know that if cheap clothes are in the UK for sale, people will buy them (& lots of them). It is partly our Government's responsibility to hold companies to account who are not paying a local Living Wage in the countries where they operate or obtain goods and services. There is also a key role here for Responsible Shareholders, to insist that profits are not at the expense of poverty, and are only derived from a labour chain where all have the ability to feed their families at the very least. See Share Action for more information about this important topic. The anniversary of the Rana Plaza Bangladeshi factory collapse has hit the headlines recently – many are reminding us of the tragedy and keeping the campaign for fair working conditions going, including War on Want who comment: "All workers who produce clothes for the UK high street should be guaranteed safe working conditions and a living wage." Fair Trade clothing need not cost any more, as much research has shown that in many cases, overseas wages could be doubled without the extra cost needing to be passed on to consumers*. If the movement to consume more fairly and pay a living wage can become more widespread, this will in turn spread global wealth more fairly. For more information, see Labour Behind the Label and the Clean Clothes campaign. Who does it benefit if a few companies make large profits, while encouraging UK consumers to buy the cheapest goods possible and ripping off overseas workers? The practice of poverty wages creates a working poor, ultimately affecting us all, and is being seen more and more here in the UK too. To take action and show your support, join the War on Want Campaign to communicate to Foreign Secretary William Hague (as minister responsible for the UK government’s business and human rights action plan) that we care and action needs to be taken. *In 2006 Labour Behind the Label wrote: " Labour costs typically represent something between 0.5% and 4% of the retail price of a garment or sports shoe. In a Bangladeshi factory visited by CAFOD (Catholic Fund For Overseas Development) in 1998, the wages earned sewing large, quilted ski jackets, based on figures provided by the management, came to 51p per jacket. A similar jacket on sale in the UK costs £100. The wages of the women sewing these jackets could have been doubled without the extra cost needing to be passed on to consumers. Where labour costs are higher (they represent 4% of the retail price in sport shoe manufacture), it may be that some of the cost incurred in paying workers higher wages would need to be passed on to consumers. Paying Indonesian sport shoe workers a living wage, for instance, would raise the cost of a $65 pair of sport shoes to $70."