Is clothing “made in USA” more ethical? How “ethical” should be defined?

It has become a commonly held view that apparel workers in many developing countries are unfairly treated because they are much lower paid compared with their counterparts in the developed countries.  For example, American Apparel, a company that insists all of its products made in USA, claims itself to be sweatshop-free on the basis that it pays workers an hourly wage of $12.  However, does an hourly wage of $12 in the USA necessarily mean more “ethical” than an hourly wage of several cents in a poor developing country like Bangladesh?  

An often ignored fact is that in many developing countries, jobs in the apparel sector are better paid than positions in other sectors. For example, according to a recent study conducted by the World Bank, in Bangladesh, wage level in its apparel sector is 17.7% higher than the average level of all sectors, 72.2% higher than the wage level in the agriculture sector and 4.5% higher than the wage level in the service sector. This is not surprising, because in many developing countries, “moving from agriculture and low-end services into apparel jobs is a channel for social upgrading” (Lopez-Acevedo & Robertson, 2012).

Then, what does an hourly wage of $12 mean in a developed country like the United States? Data from the Bureau of Labor Statistics show that, in 2012, average wage level in the U.S. apparel manufacturing sector (NAICS 315) is 26.2% below the average wage level of all sectors. More specifically, the average wage level for the production occupations is 47.3% below the national average level and 53.6% below the national average level for sewing machine operators, the exact type of job that the hourly wage of $12 refers to. 

The point to make here after the comparison is that it is misleading to define “ethical” or comment on “corporate social responsibility” without putting the matter in the context of the stage of development and the nature of the economy.  Wage level is not determined by good will, but by the principle of economics 101.

By Sheng Lu

apparel payment

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Author: Sheng Lu

Professor @ University of Delaware

13 thoughts on “Is clothing “made in USA” more ethical? How “ethical” should be defined?”

  1. Just because a company is paying workers higher wages definitely does not mean that they are “sweatshop-free”. American Apparel, as well as many, many other companies need to consider the working environments within their factories before they start to refer to themselves this way. If the factories do not follow by ethical rules, then that fact alone is extremely unjust to its employees. It is also known that American Apparel is a company that hires many illegal Mexican workers to work in their factories, which raises many questions (to me, at least) as to who is really keeping an eye on them. Hiring illegal citizens as employees does not necessarily mean anything, for they could just be hiring those who are willing to work in their factories, but I personally feel that if they are hiring a decent amount of these people then maybe there is something bigger going on. Maybe they do not have ideal working conditions, which is just not fair.
    I did not know that $12/hr for working in a factory in the US was a low wage compared to those in other countries. This further proves my point that these kinds of companies may be corrupt, and that the US government should potentially perform inspections, require working papers (or something to keep track of things), or just do something in order to prevent controversy, and possibly even encourage Americans to return to factory jobs. Maybe we should be working on improving working principles and wages, and factory conditions domestically before we can start to help fix them abroad.

  2. Although the U.S. is known for paying their workers a decent wage and providing safer conditions compared to factories in developing countries, does not necessarily mean “made in the USA” is more ethical. Factories are never in the best conditions and do not always provide a safe atmosphere for the workers. The pay wage for factory workers compared to other professions in America is still very low and usually these workers cannot live off of these wages. Because of these aspects most Americans do not seek out factory jobs as to avoid low pay and dangerous conditions.

  3. I do agree with this but I feel as though the ethical part of a company is not only how much their hourly wage is but also the working conditions. In developing countries the apparel wages may be higher then other service jobs but the living conditions of a factory in a developing country compared to a manufacturing company in the US is vastly different. So as far as being ethical I believe it has much more to do with just wages it goes into the core values and overall behaviors of a company. Another unethical example of developing countries is the massive amount of pollution and waste that is improperly disposed of. Compared to the US where environmental regulations are put into place, and people that disregard these environmental regulations will be fined. I think there are a lot of contributing factors to what is considered an ethical business, not just wages.

    1. you raise some great points in the comment. Yet the sad reality is that not all countries are as resourceful & affluent as the US. Companies AND local government in the developing countries may have to make a hard choice between achieving economic growth and sacrificing certain social benefits (like human rights) & environment for the time being. Only when the economy develops, can these countries have the capability of providing better conditions for their workers or enforcing stricter environmental rules.

  4. I do not think the term “ethical” directly corresponds with wage level. I believe that in terms of good ethics, a company/factory must be providing their worker with a clean and safe working environment. I also believe that the age of workers must be appropriate in order to be considered good ethics (no child labor/underage workers). When speaking about wage level, i believe that better corresponds with how much work is being done, how much effort must be put in to completing work, what the economy is like overall, etc. Many different factors come in to play when deciding the wage level for factory workers. I believe that as long as the wage-level correctly portrays the amount of effort put into the work and depending on the economic stance of the country, it is considered ethical. As said above, “wage level is not determined by good will, but by the principles of economics 101”.

  5. The term “ethical” is a difficult one to define. An hourly wage alone does not determine ethical working conditions. Factors such as building condition, safety of equipment, and the supervisory behavior all play a role in what “ethical working conditions” should mean. A company such as American Apparel should not claim to be sweatshop free based on wages alone. I think that wage should be determined by the level of skill and time required to complete the given task. The higher the level, the higher the wage should be. While wage is a considerable part of workplace ethics, the specific wage itself should be reflective of the task in need of completion as well as the cost of living in the place of employment. An “ethical” wage should be a livable one.

  6. I completely agree with this article’s point that you cannot measure a country’s ethics based solely on its wages in certain industries. Just like any other issue, cultural differences need to be put into perspective. As the article states, countries like Bangladesh view jobs in the apparel industry as having a higher status than jobs in other industries, such as agriculture. Since the United States does not have this same view, it does not give us the right to compare wages, despite our wages in the apparel industry being significantly higher than countries like Bangladesh. Cultural and economical differences need to be taken into account when comparing countries ethics.

  7. I think that this article is very interesting. I never really thought about the fact that although what may be a low wage to us in the US, you cannot compare it with that of a developing country. I think that we should also look at the “ethical”-ness of what the wage can really get you in each country. perhaps what the cost of living is in each area.

  8. This is a good point, but isn’t is also important for the workers to understand the structure of their economy. If the wage level in agriculture is lower than the apparel sector in Bangladesh, isn’t it similar that the wage level of apparel manufacturing is lower than say a management job in the US? Workers should understand their economies and the directions they are heading in the future. Innovative thinking is important for success.

  9. I think it’s difficult to use the term “ethical” in this case since it looks at wage alone. A wage received in its singularity, i think, does not make something unethical or ethical in this case because they are all living wages. I can see, however, how this fact gets lost on Americans who forget that the cost of living is far lower in developing nations and while a handful of dollars a day seems extreme, that is in relations to our own economy. What is more important is the condition in which the workers are subjected to. Where these sweatshops in other counties may pay more than other jobs in that area, it is unethical if they are working in hazardous conditions or extraneous hours. This happens much less frequently in America, and would be why they are seen as more ethical even if they do only pay say $12/hour (which is still more than other jobs could make at minimum wage).

  10. I agree with everyones comments! I believe workers in any work force should be aware of their surroundings and whats going on around them. Just because something is made in the US and workers get paid $12 an hour (american apparel) doesnt mean workers in other countries should be getting paid differently/have different working conditions. It’s so unfair how the world is today and everyone works differently and effectively in their own way.

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