There are two benchmark figures in the area of low-income and poverty wages:
- The Minimum Wage (where it exists) is the legally-enforceable minimum rate of pay, set either by legislation or by some administrative process. If it is not observed, it is fairly straightforward to take legal action against the offending employer.
- The Living Wage, on the other hand, is the minimum wage necessary for a person to make ends meet. Ideally this is less than the minimum wage but alas it has long been the case that in many States of the USA the Minimum Wage pays less than a Living Wage. The exact level of the Living Wage constantly changes as costs of living increase.
If an employer fails to pay the living wage there is no easy way to get them to do so!
Enter Asia Floor Wage.
AFW is a coalition of unions and other activists who pursue fair wages for garment workers in Asia (they refer to the Living Wage as a ‘Floor Wage’). This week they published revised minimum monthly rates for the six major garment manufacturing countries:
- Bangladesh 12248 BDT
- Cambodia 692903 Riel
- India 7967 Rupees
- Indonesia 2132202 Rupiah
- Srilanka 19077 Rupees
- China 1842 RMB
These rates are equal to 540 USD at purchasing-power parity.
According to AFW, the ‘gap’ between the Living Wage and the Minimum Wage in these countries is, on average, 1 to 2. Guangdong, China’s manufacturing province, comes close but still falls short.
AFW have also assembled a helpful guide for retailers and sourcing companies who want to take CSR seriously, explaining how they can meaningfully commit to fair wages in garment production.