Rising labour wages and cost of land seems to be taking a toll on the Myanmar garment industry with around 14 factories in the country’s Yangon’s industrial zones expected to shut down in next couple of months, leaving over 3,000 workers jobless, as per media reports.
Majority of these factories are reportedly into apparel manufacturing.
“We will meet with the businesses from the Yangon industrial zones to learn why they want to shut down, as the consequences will have a large impact on the economy on the micro level,” reportedly underlined regional representative in Yangon and chair of the Finance, Planning and Economic Affair Committee under the Yangon regional Hluttaw, Daw Sandar Min.
As per U Myint Soe, chief of Myanmar Garment Manufacturers Association, the primary reason behind these factories deciding to wind-up operations was due to increase in production cost, especially the wage of the workers.
“The garment industry is under pressure from having to raise the minimum wage. At the same time, productivity, which is already lower than other countries in the region, has not improved. As a result, many garment businesses no longer want to operate here,” reportedly maintained Soe.
It may be mentioned here that earlier in 2018, the National Committee for the Minimum Wage has set daily minimum wage at US $ 3.60 per hour for an eight-hour shift, which is reportedly almost 30 per cent increase from the earlier base wage.
This move of the Government reportedly met with widespread resistance and objections from the entrepreneurs as well as the workers.
