Quote: Derwent "Yes in certain sectors you could, no doubt about that, in others you couldn't. It wouldn't make much of a difference to higher end retailers who are buying jeans for £3 and selling for £75, but it would make a difference to Primark-type retailes who buy for £1 and sell for £5.
But again the retailer works on a target profit margin so any increase would be passed on to customers which would create the inflation I mentioned some time back. Unless the retailer is prepared to absorb the extra cost (which is unlikely) then somebody else in the chain has to pay it, and that would be the consumer.'"
An increase in the labour cost to produce a t-shirt in Bangladesh has absolutely zero effect on the fixed and variable costs of a UK (or other Western developed nation) retailer.
The TUC has determined that a doubling of the rate paid to Bangladeshi garment workers would add all of 2p to the cost of a t-shirt
rlLINKrl. Of course you could argue that the TUC are taking a simplistic view and are not factoring in the applied percentage profit margins at each stage of production, distribution and sale. But I would counter that with: other than "that's the way it's always worked", why should that be the case? There is simply no sensible reason, other than sheer greed, why those workers wages cannot be doubled.
Paying the national minimum wage means you are 1p the right side of illegality. It has absolutely nothing to do with the issue of exploitation.
