The Southeast Asian nation’s Ministry of Labor announced Thursday that the minimum monthly wage for the apparel and footwear sector will get a $2 lift to $194 beginning next year, following protracted and often stalemated negotiations between trade unions, employers and the government to arrive at a compromise.
The increase falls short of the $12 sought by labor groups representing the $7 billion industry’s more than 800,000 workers, most of them women, whose financial woes have only worsened as a result of the ongoing Covid-19 pandemic. A citywide lockdown in the capital of Phnom Penh earlier this year, which barred residents from leaving their homes unless there was a medical emergency, left tens of thousands of savings-poor workers stranded without income or government assistance. To put food on the table, many mired themselves in a cycle of debt as they take on new loans to pay off old ones.
Drok Sovan, a garment worker in Yi Da factory in Kandal province, told the Khmer Times that she was “very shocked to hear about the little increase,” which she said will bring scant relief to workers struggling to survive. “Oh my God, nowadays very high inflation is affecting all of us,” Sovan said. “We are already working very hard for low wages and with $194 we cannot even pay for our food and taxi to go home every day and also rental.”
Factory owners, meanwhile, claim the bump will further strain their bottom lines, especially since operating costs are also expected to rise. Employers will be spending more on pension and health care contributions, along with safety measures to curb the spread of Covid-19, including up to $4 per head every month on tests. “Even a $2 increase would have a negative impact,” Kaing Monika, deputy secretary-general at the Garment Manufacturers Association of Cambodia, told Reuters.
Both workers and civil society groups have urged multinational brands, such as Adidas, Gap, H&M, Levi Strauss and Target, to do more to help the Cambodian workers who make their products. According to an analysis published by the Cambodian Trade Unions and the Clean Clothes Campaign in July, the country’s garment workers missed out on an estimated $109 million in wages between April and May alone. Coupled with outstanding wages and severance pay from the first 13 months of the pandemic, they have lost at least $393 million altogether.
The organizations said that most brands, with their healthy profits, could “easily afford” to ensure that all the workers in their supply chains receive their regular wages amid a health crisis, yet the majority continue to downplay their individual responsibility or hide behind multi-stakeholder initiatives such as the International Labour Organization’s Call to Action, which has had limited success amassing and distributing funds.
Cambodia’s garment workers have been pleading with brands to intervene since last April, when production lines first ground to a halt because of raw-material delivery logjams from China, then the epicenter of Covid-19, throwing employment and livelihoods into turmoil. The issue is “no less urgent now,” they say.
“Workers in the Cambodian garment, footwear, textile and travel goods industries are already forced to rely on overtime pay and additional benefits to make ends meet and the insufficient amounts provided by way of government allowances have left them in immense hardship,” several Cambodian trade unions wrote in an open letter dated Feb 8. “Therefore, we ask brands to assess and remediate wage (and severance) payment gaps in your supply chain and make up the shortfall between amounts workers received before the pandemic and those amounts currently received. We also raised these issues in our April 2020 letter and they are no less urgent now, as we have seen no substantial steps taken to ensure workers’ livelihoods.”
As in neighboring Vietnam, Cambodia’s caseload remained low until the emergence of the delta variant, which caused a surge in the virus. Although 98 percent of Cambodia’s 16.5 million population has been jabbed at least once, according to health officials, the nation recorded 866 new infections Wednesday, bringing its total number of cases to 111,000 and its death toll to 2,287.
At the same time, the country has benefited from uncertainty in countries such as post-coup Myanmar and previous Covid-19 hotspots such as Bangladesh and India. From January to August, Cambodia exported $5.02 billion worth of products, a 3.3 percent increase over the same period last year, according to the Ministry of Commerce.
“Our garment industry has been functioning normally, and we have seen a remarkable rise in purchase orders because our country is now safer from Covid-19 than other garment manufacturing countries,” Prime Minister Hun Sen said during a press conference earlier this month.