Bangladesh Garment Sector Sees 20,000 Workers Laid Off in Six Months

In the first half of 2024, at least 20,000 workers in Bangladesh, predominantly from the ready-made garment sector, have been laid off or dismissed. This figure is derived from analyses by the Industrial Police, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA). A significant number of these dismissals occurred in March and May, coinciding with major Eid festivals. For instance, Al-Muslim Group laid off 1,868 workers from its three factories in Savar after the Eid-ul-Adha holiday. Many affected workers are still awaiting their due wages, benefits, and compensation. The closure of factories like Unique Washing & Dyeing and Unique Designers, which employed 1,800 workers, has exacerbated the situation, with employees not receiving their dues.

Factory owners attribute the rising layoffs to a decline in work orders and financial difficulties, exacerbated by what they describe as bank uncooperativeness. They also cite external factors like retaliatory tariffs imposed by former US President Donald Trump and increased competition in European markets, compounded by the Iran conflict, as reasons for reduced exports. However, labor leaders dispute the severity of the drop in work orders, noting only a marginal decrease in ready-made garment exports in the last fiscal year. They also suggest that a significant portion of dismissals are linked to workers' attempts to organize and form trade unions, a process made easier by recent amendments to the labor law. The revised law requires consent from only 20 workers to form a union, a significant reduction from the previous 20% threshold.

Industrial Police data indicates that in the first five months of the year, 7,784 workers were laid off across 79 factories in eight industrial zones, with Savar-Ashulia and Gazipur being the most affected. BGMEA data reveals that its member factories dismissed 19,188 workers in the first six months, with 27 of these factories ceasing operations. While some dismissals are attributed to reduced orders and financial crises, others are reportedly due to worker activism, production stoppages, misconduct, or document fraud. Labor organizers are calling for thorough government investigations into the reasons behind factory closures and dismissals, especially concerning worker compensation.