Sweatshops
Denis G. Arnold
The term ‘‘sweatshop’’ is typically used to denote a factory where workers are subjected to working conditions that harm their well being. These might include dangerous health and safety conditions, extremely low wages, extremely long work hours, physical or psycho logical abuse by supervisors, and disregard for local labor laws.
The resurgence of illegal sweatshops in North America and Europe has received considerable attention. However, it is the offshore labor practices of North American and European based multinational enterprises (MNEs) and their con tractors that have been most controversial. This is partly due to the fact that many of the labor practices in question are legal outside North
America and Europe, or are tolerated by corrupt or repressive political regimes. Unlike the recent immigrants who toil in the illegal sweatshops of North America and Europe, workers in developing nations typically have no recourse to the law or social service agencies.
Disagreements regarding sweatshops are at the core of contemporary debates regarding globalization. Many economists argue that what is needed are more, not fewer, sweatshops. This position is grounded in the idea that the exploitation of a natural resource such as labor will allow developing nations to attract foreign direct investment. This, in turn, will stimulate eco nomic growth and increase employment levels. Providing workers with wages and working conditions above what the market demands will, it is argued, raise unemployment levels. Further more, because sweatshop workers often earn more than they otherwise would, it is argued that they are fortunate to have such jobs. For these reasons, such economists reject calls for new regulations governing the treatment of workers in factories in developing nations.
In reply, anti sweatshop activists and numerous non governmental organizations argue that the necessary preconditions for a free market in labor often do not exist in developing nations because of the desperate circumstances of workers and the coercive influence of govern mental, or quasi governmental, organizations. These critics accuse MNEs such as Disney and Nike of the ruthless exploitation of workers in their contract factories in developing nations. This position is grounded in the idea that core labor standards should be respected. Further more, because sweatshops produce many negative externalities, such as social disruption caused by urban migration and the growth of slums around free trade zones, it is argued that their benefits are overstated. For these reasons, such critics urge the imposition of new regulations governing the treatment of workers in factories in developing nations.
A third position calls upon MNEs to voluntarily improve the health and safety conditions in their offshore factories and to increase wages and benefits. This view is grounded in the idea that MNEs must, at a minimum, respect the basic human rights of workers. Furthermore, this view holds that it is strategically valuable for MNEs to respect workers’ rights because doing so may result in strategic advantages like im proved relationships with key stakeholders such as customers and investors. This view is sup ported by the fact that some MNEs such as Motorola have long placed a high priority on respect for the basic human rights of workers. If some MNEs are capable of treating workers with dignity and respect while remaining profit able, then mutatis mutandis it should be possible for others to do the same.
In response to the public uproar over the use of sweatshop labor, several MNEs have recently implemented innovative new programs aimed at improving the well being of their workers. Nike, Mattel, and Adidas Salomon have each put in place a series of morally imaginative programs concerning such important issues as child labor, worker health and safety, and worker education. These programs have been studied by academics and now serve as models for other companies that wish to improve their global labor practices.
Bibliography
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