Adam Smith Institute

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Buy ethically: Buy sweatshop

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buy-ethically-buy-sweatshop

sweatIn light of news this month that ethical shopping and the success of Fairtrade has grown in spite of the recession, I felt it was about time to defend sweatshops. Outrageous as it might sound, I would rather buy sweatshop-produced than Fairtrade-labelled goods. Far from being evil, sweatshops are a necessary rung on the ladder of economic development and lift millions of people out of poverty across the developing world.

Although the long hours, low pay and unpleasant conditions associated with sweatshops may seem abhorrent to us in the West, it’s pointless comparing their pay and work environment to those in the developed world. If we were to enforce a minimum wage and our work conditions in factories in the developing world, then there would be no reason for manufacturers to build there. The lack of a minimum wage and high labour supply are what give people in these the competitive advantage when it comes to manufacturing. Remove these advantages and sweatshop workers would be forced back into destitution or relying on unpredictable subsistence farming. The choice is between poorly paid work in a sweatshop and terribly paid work in agriculture.

Sweatshops, particularly in countries such as Bangladesh, mostly employ women. Before the arrival of sweatshops these women had no work and no economic rights, mostly living in rural communities with no access to education. Working in a sweatshop allows them to have for the first time the ability to provide for themselves. Even at such low wages they can be self-reliant and save money, giving them the freedom to choose who they marry and to invest in further education to improve their employment opportunities. In comparison women in rural undeveloped regions have no choices, no education and no possibility for self-determination or improvement. For these women working in a sweatshop is not slavery. It’s a choice that brings for them significant benefits and freedoms.

If we really want to help developing world countries lift themselves out of poverty we should buy more of everything they produce, not just Fairtrade products. The supposedly ethical boycotting of sweatshop-produced items or the pressuring for the closure of factories could in fact have devastating effects on micro and macro levels. So next time you pick up a t-shirt made in Cambodia, don’t feel bad. You're helping a poor country – and poor people – get richer, potentially helping a young women become economically empowered and contributing towards a raising in the standards of living for millions as they are lifted out of extreme poverty.