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Not job cut, improving skills a must to reduce operational costs

In a recent development, Bangladeshi apparel makers have moved to reduce cost by cutting jobs in the mid-level management and to some extent workers.

This is because of the rise in production costs due to adopting new technologies, implementation of new wage structure, which came into effect from December last year.

improving skills in BD apparel sector

The makers are making a huge amount of investment in automation, which posed a threat to the new employment generation in the $30 billion apparel sector. Since its journey in 1978, the sector now employs about 4.4 million workers mostly women.

According to World Bank President Jim Yong Kim recent statement, about two-thirds of jobs in the developing world may be lost due to automation.

While the International Labor Organization (ILO) report on Textile and Clothing Sector in ASEAN states that the textile, clothing and footwear sector is at the highest risk of losing jobs due to automation.

According to a ILO report on Textile and Clothing Sector in ASEAN states that the textile, clothing and footwear sector is at the highest risk of losing jobs due to automation.

The present status of Bangladesh’s apparel sector in a small scale reflects the voice of the World Bank and ILO regarding the use of technology in production.

In the given situation, panic gripped the mid-level managers and staffs, which impacting the productivity of the workers hurting the employers.

“As an officer, I have to manage the total production floor and the productivity of the total team demands on the performance of mine,” Anisul Alam (not real name), a mid-level management officer at an RMG factory located in Gazipur told Textile Today, while sharing his thoughts on the issues.

Anisul also lost his immediate boss as the factory has terminated him in a bid to reduce operating costs.

“The termination of my colleague made me afraid and I am a little bit in confusion about the future of my career, which cast a negative impact on my performance impacting the total team,” said Anisul.

How to reduce cost without job cuts

There is a common tendency among the employers of cutting jobs to reduce operational costs. But it is not good for the industry as it drives away skilled and potentials mid-level managers as well as a worker from the sector.

So, in keeping the production and operational cost at a reasonable level, instead of making a huge investment on machinery upgradation, the makers should invest in human resource development. If it is done, they will contribute more in the production process.

“In line with the inflation rate, the cost of living and other costs of doing businesses will go up and it is a common phenomenon. And in remaining competitive in the global market, everyone wants to reduce cost,” former caretaker government Advisor AB Mirza Azizul Islam told Textile Today.

“But this should not be by cutting jobs.”

To this end, an employer has to increase productivity first, then have to think to reduce another operational cost beyond the employees’ wages, said the economist.

“In addition, the makers have to increase negotiation skill in getting a better price from the global buyers and retailers, while move should be given toward products diversification.”

There is a common tendency among the employers of cutting jobs to reduce operational costs. But it is not good for the industry as it drives away skilled and potentials mid-level managers as well as a worker from the sector.

How to adopt technology without job cut

In coping up with the world market trend, Bangladesh needs to upgrade technology in improving products quality. But the question is how much it will adopt and where to introduce.

“There is growing concern that the new technologies could lead widespread job losses, a countervailing force is at work across the Asian region. And the arrival of new technologies to cause a 17% decline of the labor force in the region,” Yasuyuki Sawada, Chief Economist of Asian Development Bank (ADB) said recently in the seminar.

“But there is hope as the market expansion absorbing more employee workers and technology are not being replaced workers everywhere in production.”

The regional lender stressed on skilling more mid-level managers so that they can take the lead in increasing productivity and produce value-added goods to avoid the impact of new technology up-gradation.

There are compelling reasons to remain optimistic about developing Asia in some areas such new technologies often automate only some tasks of jobs, technical feasibility does not guarantee economically feasible, rising income and demands and new occupations and industries, he added.

Meanwhile, there is an important role from the government, which can help in making the mid-level managers and staffs more capable to remain in the jobs with training.

The government has an important role to play in the leveraging technological advances for inclusive growth.

The government has to play a role in the field of education and training, favorable labor regulation, social protection, tax policies, facilitate skills development and job making. Also, the provision of public goods and service and investment in ICT infrastructure said Sawada.

Meanwhile, top management of apparel makers opined that workers education level and better training could be a safeguard against automation.

“In Bangladesh context, the education level of apparel workers is very low, while there is a lack of graduates in relevant fields. These are barriers in making them capable of new technology,” Mohammad Hasan Executive Director of Babylon group told Textile Today.

While there is a lack of proper training in making the staff capable of new technology, if these two things can be ensuring, there is no risk of losing jobs, he added.

If anyone has any feedback or input regarding the published news, please contact: info@textiletoday.com.bd

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