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Cambodia Considers Wage Hikes

Just after Bangladesh Prime Minister Sheikh Hasina strongly urged garment factory owners to raise its workers’ wages, Cambodia is showing signs of following suit. The secretary general of the Garment Manufacturer’s Association in Cambodia (GMAC), Ken Loo, announced that his agency will be exploring the possibility of elevating minimum wages.

As it stands now, the minimum wage is approximately $80 per month, following a increase last May of $14 that included a $5 health care allowance.

This is a bright spot amidst some darker times for Cambodia’s garment industry. A recent report issued by the International Labour Organization’s Better Factories Cambodia program (BFC) purports to show that general condition of these factories has markedly declined since 2011. This is especially striking since the same study detected improvement int he eight years prior to 2011.

The BFC report discovered that more than 15 percent of the factories surveyed failed to maintain unlicked emergency doors during normal working hours, that 45 percent did not fulfill their legal obligation to conduct fire drills every six months and that 53 percent had key fire exits illegally obstructed.

Part of Cambodia’s problem has been accommodating breakneck economic growth, saddling it with inordinate pressure to absorb more business before its infrastructure can catch up to the new demand. Between 2012 and 2013, Cambodia increased the number of its factories by a hefty 8 percent to 412. This is partly due to the changing topography of sourcing created by the increasing expensiveness of China, once a prime destination for retailers and brands looking for bargain manufacturing.