Catherwood LibraryILR School

A study conducted by Clean Clothes Campaign (CCC), an international organization dedicated to improving working conditions in the garment industry, has found that countries in eastern and southeastern Europe are “low-wage havens” for well-known retailers such as H&M, Benetton, and Esprit, as well as luxury brands like Louis Vuitton, Prada and Versace. Garments are labeled as “Made in Europe”, such that consumers may assume that clothes were made in fair working conditions, but they are often made by workers living in poverty, due to earning less than minimum wage, as well as working unpaid overtime hours. The garment industry in Serbia, an emerging economy, employs 8% of the country's workforce, paying women workers – who make up the bulk of the garment industry - an average of under 227 euros per month when living wages for a family of four would be 652 euros per month. Well-paid jobs in Serbia are in state institutions and hiring is dependent on connections and political affiliation. Governments are sometimes complicit in creating poor working conditions, as they may provide foreign companies with direct and indirect subsidies, and set very low minimum wages. In Serbia, businesses are given high subsidies, plots of land below market price or even for free, tax breaks and free infrastructure. Workers are afraid of being fired and endure mistreatment including sexual harassment and denial of statutory minimum vacation, primarily because it is a pro-employer environment where unions are weak or non-existent; they may also feel lucky that they have a job, with an overall unemployment rate in Serbia of 16 percent (30 percent for young people). The economic climate in southeastern Europe is such that many impoverished countries are fighting for the same investments, fostering competition over who will offer foreign investors favorable conditions for low-cost manufacturing.