Skip to main content Accessibility help
×
Hostname: page-component-848d4c4894-tn8tq Total loading time: 0 Render date: 2024-07-03T21:52:15.920Z Has data issue: false hasContentIssue false

4 - Living Wages and Labour Subsidies

Published online by Cambridge University Press:  21 January 2022

Dev Nathan
Affiliation:
Institute for Human Development, New Delhi
Shikha Silliman Bhattacharjee
Affiliation:
University of California, Berkeley Law
S. Rahul
Affiliation:
Tata Institute of Social Sciences, Mumbai
Purushottam Kumar
Affiliation:
Society for Labour and Development
Immanuel Dahagani
Affiliation:
Society for Labour and Development
Sukhpal Singh
Affiliation:
Indian Institute of Management, Ahmedabad
Padmini Swaminathan
Affiliation:
Tata Institute of Social Sciences, Hyderabad
Get access

Summary

In this part, we deal with the factory as the site of extraction of subsidies from labour. This extraction is carried out through the payment of wages below a living wage, which is the cost of producing labour power. In this chapter, we outline the concept of living wages and demonstrate their calculation for major supplier countries of Asia, such as India, Bangladesh, Sri Lanka, and China. We then compare the living wages for these countries with national minimum wages, which are often the basis for labour costing in contracts between brands and suppliers. Further, in the case of India, we also look at the actual wages paid, to see the extent of extraction of labour subsidies.

The subsidy from labour is extracted in two ways. First, through the overuse, particularly of women workers’ bodies and, second, through support to garment workers by their rural households. The first method of extracting labour subsidies, through the overuse and discard, particularly, of the bodies of women garment workers, is dealt with in Chapters 5 and 6. The second method of extraction is dealt with in Chapter 7, where we discuss the role of the rural connection in sustaining workers during times of need.

This chapter begins with an account of brand–supplier relations in garment GVCs, setting the context for the discussion of workers wages that follows. It then sets out the concept of living wages and the manner of their calculation, including how we can take account of women's unpaid domestic work. We then provide an analysis of wages in two major Indian garment clusters, along with national-level secondary data on wages in the garment sector. Using official survey data on wages and profits, we put forward the proposition that wages in supplier firms are constrained by the low level of profits earned by these firms, and the national minimum wage base of contracts by supplier firms in monopsonistic global value chain (GVC) relationships with lead firms. These firm-level characteristics that lead to low wages are reinforced by worker characteristics, such as gender and low educational levels.

Low wages in the garment industry are usually explained by features of workers in this industry—with low educational levels and a high proportion of women in the workforce.

Type
Chapter
Information
Reverse Subsidies in Global Monopsony Capitalism
Gender, Labour, and Environmental Injustice in Garment Value Chains
, pp. 69 - 96
Publisher: Cambridge University Press
Print publication year: 2022

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Save book to Kindle

To save this book to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×