The Fair Labor Association visited 56 factories for onsite assessments between July and October of 2020 and found that most factories had experienced significant negative impacts from COVID-19.
Eighty-two percent of the factories visited by the FLA experienced a reduction in product orders from buyers. A larger percentage (95%) reported that they had to reduce working hours or workforce due to COVID-19. The workers that remained worked fewer hours, with an average 45% decrease of overtime hours across all factories during the peak of the pandemic (February 2020 to July 2020). The decrease in hours could have a significant negative impact on workers’ income because many workers rely on overtime to make ends meet. When factories rely on excessive overtime and workers rely on overtime pay, as they do in China and Vietnam, workers are put in vulnerable positions, especially during unforeseen events such as the COVID-19 pandemic.
The workforce reduction across all factories visited by the FLA was highest through July and September. Our analyses show a gender disparity in factories. For each male worker who lost a job in 2020, three female workers lost their employment.
While the results represent the situation in factories where FLA members source, most of these factories have multiple buyers, including non-FLA members. The report is helpful to understand the impact of COVID-19 at the factory level, and recommendations are for all companies who are in the apparel and footwear industry.
As countries recover from the initial outbreak and the subsequent second and third waves, the effect on workers could be significant and long lasting. Therefore, the FLA urges companies to support factories and workers by providing steady and reliable business and strong channels of communication to understand the pandemic’s impact on the apparel and footwear workforce.
