Pandemic wipes out 3.57 lakh apparel jobs: study

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The coronavirus pandemic destroyed 3.57 lakh jobs in the garment industry in Bangladesh in 2020 as factories gone for layoffs and closures as a result of the collapse popular, a fresh study found.

More than 50 % factories had fewer workers in September in 2020 in comparison to what they had found in December 2019, said Khondaker Golam Moazzem, research director of the Centre for Insurance plan Dialogue (CPD), throughout a virtual dialogue yesterday. 

The impact caused by the crisis has been so devastating that only 44 per cent factories said these were certain about the task orders for the half a year from November 2020 to April 2021.

Some 56 per cent of factories face numerous levels of uncertainty and 11 per cent indicated high uncertainty, based on the survey of the CPD and the Mapped in Bangladesh (MiB), a job of Brac University.

The outcome of the analysis was presented through the dialogue on "Vulnerability, Resilience and Restoration in the RMG Sector because of Covid-19 Pandemic: Findings from the Enterprise Study".

Out of 3,211 l enterprises listed with the MiB, 610 were surveyed on a sample basis. Of these, 54 per cent are small in proportions, 40 % medium and 6.7 per cent large.

The principal survey was executed between October and November in four key industrial clusters, specifically Dhaka, Gazipur, Narayanganj and Chattogram.

Some 357,450 staff out of 2,562,383 workers covered lost careers from January to September, about 14 per cent of the total.

The number of employees that were laid off was 2.2 %.

"It had been informally agreed that the factories that received the stimulus offer would not retrench personnel," said Moazzem.

Most the factories didn't follow the layoff and termination rule. Only 3.6 per cent complied with the compensation basic principle, meaning they paid earnings and compensation and cleared dues the CPD explained.

About 70 per cent of the factories paid the salaries only. "Non-compliance is much bigger in the factories located in Narayanganj and large factories," the think-tank said.

Factories have recruited workers during the pandemic to hold operations running. Thanks to the continuing demand for development workers, 58.7 % of factories recruited new workers.

The capacity utilisation of the factories improved with the rise in the orders: In April, 89 % of factories had zero capacity utilisation, which came to down 1.3 per cent in September.

Because of the pandemic, how big is factories has scaled straight down. The common number of workers in a factory in December 2019 was 886, and it came right down to 790 in September this past year, a fall of 10.8 %.

Speaking by the virtual dialogue, Rehman Sobhan, chairman of the CPD, said beneath the current organization model, most of the responsibility was borne simply by the supplying countries, and the customers were risk-free.

There is a lack of information how a $2 shirt comes at $20 by international retailers and brands, he said, suggesting study firms conduct studies upon this particular issue.

He suggested introducing an over-all comprehensive insurance programme found in the garment sector. The government, buyers, donor organizations and workers should take part in the programme.

Mohammad Abdul Momen, director of the Bangladesh Garment Makers and Exporters Association (BGMEA), said as soon as the garment sector was struggling to recuperate from the fallouts of the Covid-19, the second wave hit.

Through the first wave, 99.99 % of retail outlets were shut. It really is 25 per cent through the second wave, he said.

The prices of raw materials like yarn and cotton own gone up, but the prices of garment items didn't increase. Somewhat, it decreased by nearly 15 %, the entrepreneur said.

Mohammad Hatem, primary vice-president of the Bangladesh Knitwear Producers and Exporters Association (BKMEA), said regional suppliers faced discounts between 25 per cent and 50 per cent from buyers, not only just the cut in prices.

"We have started recruiting personnel as orders happen to be flowing in. We suffer from the shortage of workers again," he said.

He said 80 per cent of factories were going at losses plus they had kept their organization ready to go just to survive.

"Ten per cent of factories are running at break-even and 10 % large units are building some profit."

Of the a lot more than 850 customers of the BKMEA, 420 availed loans from the stimulus deal. Some 99 didn't have the loan although that they had applied.

The CPD study said it had been alleged that factories that recruited new staff had usually hired their retrenched workers but at a downgraded level. This means they were presented lower grades, lower pay out and were hired on a contractual basis.

Though workers got the work, they lost entitled benefits because of discontinuation of their jobs, it said.

The think-tank said the subsidised credit provided beneath the stimulus package and the gradual rise of production orders helped factories to handle the crisis.

The package protected the demand of 70 % of the enterprises. Even so, about 30 per cent of the enterprises had been left out of the package. They include tiny and non-member factories.

Any long term package for the sector should be customised considering the priorities to little scale enterprises and non-member enterprises, the CPD said.

Kutub Uddin Ahmed, former secretary-standard of IndustriALL Bangladesh Council, said the income of garment employees declined by 8 per cent during the pandemic.

He said the fund distributed by europe and Germany for the retrenched employees cannot be disbursed as a result of faulty lists given by the BGMEA and the BKMEA.

Syed Hasibuddin Hussain, project supervisor of MiB, moderated the meeting.
Source: https://www.thedailystar.net

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