Worker shortage stunts apparel industry

Stakeholders say a shortage of workers is preventing apparel exporters from accepting more work orders and forcing some factories to miss shipment deadlines, incurring massive losses.

Bangladesh has registered impressive export earnings despite the pandemic, largely thanks to the apparel sector.

Last year, apparel exports rose to $35.81 billion, posting a 30.36 per cent growth compared to the year before ($27.47 billion). In 2021, work orders rose by 20.77 per cent.

Stakeholders say the sector needs 8 to 9 per cent more workers to meet the existing work order shipment deadline.

BGMEA and BKMEA data show the sector has around four million workers.

The crisis of workers arose as many workers left the factories when the pandemic hit and they did not return to work. On the other hand, new workers did not enter the sector.

Stakeholders say the sector needs more workers to retain the export growth and execute the existing orders as well as to take new ones.

Abdullah Hil Rakib, managing director of Team Group, said, “I expanded my business but could not operate at full capacity due to worker shortage. I set up a training centre where I trained freshers to operators to meet my demand.”

He said he has around 18,000 workers at the moment but needed at least 2,000 more.

MB Knit Fashion, located at Narayanganj BSCIC, currently has huge work orders and authorities concerned planned to expand their business.

But due to workers shortage, they are failing to run existing machinery setup and are looking for new workers.

“I need a minimum of 80 sewing operators to run all machines but there are no available workers. On the other hand, the business expansion plan has been postponed due to workers shortage,” Mohammad Hatem, managing director of MB Knit Fashion, told The Business Post.

MB Knit has 800 workers now.

Nipa Group currently has around 10,000 workers, but it says it needs another 500 more for operation.

“Currently, six line productions have stopped due to worker shortage. I am trying to recruit fresh workers but they are hard to find,” Md Khosru Chowdhury, managing director of Nipa Group, told The Business Post. “I have a huge number of work orders, but I am unable to execute them due to worker shortage.”

Fakir Kamruzzaman Nahid, managing director of Fakir Fashion, informed The Business Post that his factory needs a minimum of 9,000 workers to run at full capacity, but currently, he has around 8,000.

“We are offering high salaries and welcoming everyone, even freshers. But the response has been scant,” Nahid said.

“Many workers left the capital and surrounding areas due to the pandemic and some switched professions. It could be one of the major reasons [for the underwhelming response],” he added.

Urmi Group shifted its factory but failed to recruit workers at the new site. Even many current workers did not agree to join the new factory.

“We are in a bind as we lack workers to continue production,” Asif Ashraf, managing director of the group, told The Business Post.

He said every factory recruited new workers thanks to a buoyant work order volume. “It created a [workers] shortage.” Like others, the Indet Group could not operate at full capacity without the required workforce.

“I have requested buyers to extend the delivery time as I don’t have adequate workers,” said AL Shahriar Ahmed, the group’s managing director.

Exporters said buyers are looking to Bangladesh as an alternative sourcing hub due to the US-China trade conflict, Vietnam pandemic situation and Myanmar political unrest. They have placed huge orders, which helped the economy recover from the pandemic effect.

But when the pandemic hit, a large number of workers returned to their village homes and many did not return as the situation improved. On the other hand, some factories took work orders beyond their capacities and when they failed to recruit workers, they started production through sub-contract factories.

“Since last July, hundreds of sub-contract factories opened and hired skilled workers with high salaries. It is one of the main reasons for worker crisis,” Shahidullah Azim, vice president of Bangladesh Garment Manufacturers and Exporters Association, told The Business Post.

He said, “There are around 8 per cent worker shortage and migrations rate crossed 10 per cent.”

Nipa Group’s Khosru said he had failed to meet shipment due to worker shortage and currently had goods worth $2.5 million which will be delivered with discount.

Industry insiders said that most factory owners had set up skill development centres where they trained unskilled workers and made them general operators.

“But after some days, the workers leave for other factories, especially to sub-contract factories. Production is hampered when a worker leaves,” Mohammad Hatem said.

The work order flow is quite good now and some factories accepted orders without any assessment, leading to overlapping and missed shipments.

Exporters are bound to short shipment, discount shipment, or air shipment in case of missed shipment.

Abdullah Hil Rakib said, “Nobody should take work orders beyond 90 per cent of their capacities. It is a safe zone to avoid overlapping or stock. But most factory owners do not follow these rules and transfer work to sub-contract factories, causing worker shortage.”

Faruque Hassan, President of the BGMEA said the association has some training centers where freshers can increase their skills.

“To meet the sector’s growing demand, some training centers are under contraction to start operations soon. We have urged our all members to set up training centers of their own to develop freshers’ skills,” he added.

Faruque said the sector now needs at least four to five lakh more workers, as the huge export orders diverted to Bangladesh from some countries could easily fetch at least 20 per cent more export earnings around this time.

Nazma Akter, president of Sommilito Garments Sramik Federation, told the Business Post, that workers could not remain in the sector after turning 40 as they become weaker due to heavy-duty or overwork. “As a result, they leave jobs and return home. To retain workers, the sector has to ensure better nutrients for health,” she said.

On the other hand, other sectors are offering better wages than the RMG sector, which is another reason for the declining workers, she said, suggesting more daycare facilities, health service benefits, fair price shops and rationing for workers.