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This report identifies gaps that need to be addressed in order to improve wages and working conditions for garment workers. It describes our findings on the actual wages that Vietnamese workers in some garment factories receive and the impact of wages on their lives and families.

The garment sector is predominantly made up of women, so low wages plus poor working conditions is a matter of gender inequality. Therefore, paying a living wage and improving working conditions is an effective solution for addressing gender inequality in Vietnam.

The report identifies practices in the global supply chains that lead to this status of wages and the domestic barriers to achieving a living wage. Low wages are the result of unfair business practices within the garment supply chain. The purchasing power of brands is the ultimate cause behind all these practices and is key to the solution.

The report provides recommendations to global buyers, consumers, factory managers, the Vietnamese Government and labour unions for achieving a living wage.

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This report unpacks the concept of “living wages” and sets out companies’ human rights obligations to pay workers a living wage. It details the steps multinational garment companies and garment manufacturers can take to ensure they are meeting those obligations by moving credibly towards paying workers a living wage and developing a roadmap to do so. At the end of most sections, the report identifies practical tools for companies to further investigate how they can develop their plans. 

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The study reveals that in the average supply chain of Australian garment retailers, just 4% of the price of a piece of clothing is estimated to make it back to the pockets of workers. In countries like Bangladesh, where wages are extremely low, the situation is even direr. An average of just 2% of the price we pay in Australia goes towards factory wages. But Oxfam argues that paying living wages — wages that allow the women who make our clothes to live a decent life — is possible.

Women aged 18–25 make up 80% of the factory workers in the global garment industry. Their long hours of hard work have helped to create booming economies and large export industries for countries like Bangladesh, Indonesia, Vietnam and China. But this booming economic growth has not benefited everyone. While revenues continue to grow for many big Australian companies like Cotton On and Kmart, and while factory owners and suppliers to the garment industry across Asia continue to collect profits, the same cannot be said for garment workers.

It does not have to be this way. It is time for this unfair system to change. Brands need to pay living wages to the women who make our clothes — wages that will allow these women to lift themselves out of a life of poverty. Brands have the power — and the responsibility — to make this change.

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The research reveals not only harrowing personal stories of individuals, but a systemic failure to ensure payment of wages that are enough for people to afford even the basics of a decent life. There have been interviewed more than 470 workers across Bangladesh and Vietnam for this study. All of them were part of Australian clothing supply chains at the time of interview, employed in garment factories that supply at least one iconic Australian clothing brand. The investigation also included more than 130 interviews with factory owners, managers, union leaders and focus groups to present a clear picture of the way the fashion industry works in Australian garment supply chains.

The picture drawn is disturbing. Not only are almost all the workers we interviewed being paid well below a living wage; they are also struggling to feed themselves and their families, sometimes going hungry. They fall into spiraling debt, live in poor conditions and cannot afford the healthcare or education they and their families need.

This investigation reveals that the problems created by poverty wages in the garment industry are not isolated incidents. They cannot be fixed by action in just one factory or by addressing the hardships of just one worker. Only a strong, system-wide commitment from Australian brands with the power to change their practices will turn this around.

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The study offers the most comprehensive investigation yet into the conditions of work for women and girls in India’s home-based garment sector. Approximately 85 percent of the home-based garment workers documented for the report exclusively work in supply chains for the export of apparel to major brands in the United States and European Union. These Indian workers consist almost entirely of women and girls from historically oppressed ethnic communities who earn approximately $0.15 per hour. The primary aim of the report is to provide insights into the lives of these workers in the hope that governments, companies, and nonprofits will be able to better coordinate on solutions to address the exploitation documented.

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