Introduction
Ready-made-garment export is the lifeline of the Bangladesh economy. According to the last report Bangladesh has earned more than 83 percent of its export earnings from this sector (Nikkei Asian Review, 2018) where the total RMG export in the last fiscal year 2017-18 was US$33.93 billion (BGMEA, 2019). How much of this huge export is accounted for our own benefit? Is the textile and garment industry safe and sustainable for the local professionals? The industry has its own way to find solutions through different stakeholders- buyers, factory owners, governments, NGOs, buying offices, human right activists, local government, etc.
Let us see the types of workforce we have in the garment industry, the evolution of the availability of skilled workforce, building capacity for the future workforce, expats working in Bangladesh, and our responsibility to leverage own hard work and intelligence to retain our hard-earned foreign currency in our own country.
Workforce in Bangladesh garment industry
If we divide the workforce in the garment industry then there are broadly four categories:
- Garment workers including supervisors, line-chiefs, QCs, helpers, etc.
- Sub-sector workers
- Support staffs, including clerks, peons, chefs, guards, etc. and
- Professionals- CEO, Executive Directors, GMs, Managers, Merchandisers, QA, and Inspectors,
The latter workforce is the intelligence of our garment industry. They are the brains for the industry who really run the show by means of managing, operating, giving technical support, and marketing the factory products. There is a government concern about increasing the wages of workers, government employees etc. but this group is the most hard-working people in the country for them there is no wage board, no government intervention on illegal employment of foreign expats, no legal retirement benefits, no medical benefit, etc.
Self-reliance in the technical and managerial workforce
When the textile and garments industry started in the late ‘70s, it was the Japanese and Koreans who brought those orders and tried to find local partners to make the shipment. In the ’80s, quota benefit attracted investors from all around the world and they hired professionals from their own country as well as from India, Pakistan, Sri Lanka, and the Philippines. The ’90s was the era for mushrooming of knit composite factories because of comparatively lower initial investment cost and a handful of local textile engineers dared to run them. This industry showed us that we could run the factories with our own capabilities.
After 2000, it is probably the golden decade for Bangladesh textile and garments industry amid negative speculations of post MFA era, when local professionals started to replace those foreign nationals in managerial positions, maintaining the export growth, graduates from local textile and fashion universities take up the communications quite strongly, worked out the chemical threats and child labor issues.
Just when it looked like Bangladesh is all set to become next RMG sourcing hotspot by securing 2nd largest apparel exporter ‘Tazreen Fashions Fire’ and Rana Plaza Collapse’ brought a big question mark on country’s safe handling of the work environment. In the last 5 years, Bangladesh textile and garments industry has done well with Accord and Alliance for a rapid improvement in that area.
Building capacity in the workforce
Bangladesh has signed the MDG and SDG where it will give a mammoth growth in our economy by achieving those targets by 2030 (SDG, 2017). This target was set mainly based on our ability to achieve US$50 billion export target from RMG by 2021 (Textile Today, 2018). To maintain this growth, we need to increase our export quantity by increasing productivity or doing more value-added products or increasing the number of factories as well as a number of workers and professionals in textile and garments industry.
Recently, the government has taken steps to enhance the quality of our professionals by arranging free training for them (Islam and Islam, 2018). We also need lots of vocational, TVET institutes for technical professionals, and make as much space in the industry for managerial professionals. It is obvious that the local professionals alone are capable of running the whole textile and apparel industry. It is a matter of sorrow that there are still many factories who hire foreign nationals in key positions.
What is the number of expats?
According to The Daily Star dated December 31, 2016, the number of foreign employees working in the RGM sector is about 200,000 (Two Lakhs). In the year 2014, they draw nearly US$5 billion as salary and allowances. From September 2009 to September 2019, a total of 7,030 work permits were issued. In 2014, The Board of Investment (BOI) issued 3,511 extensions and in 2013, it was 2,907. From this data, it is quite evident that most of the foreign nationals working in this country are under illegal contract and residing without valid documents violating the immigration rule of an independent country. New Age (2018) in one of their recent issues has claimed that more than 5 lakh foreign nationals are working in Bangladesh and the same amount as reported by The Daly Star in 2015 is draining the hard earned foreign currency out of the Country. The sectors include apparel, textile, buying house, telecommunication, information technology, poultry, and poultry feed sector.
Bangladesh Garment Manufacturer Association (BGMEA) after enquired 5,000 of its member factories to submit a report of a number of foreign employees they have. Only 233 of those member factories replied out of those 5,000 factories. As a matter of fact, most of those expats do not have a legal work permit and this is the reason factories cannot report them to BGMEA. Foreigners and expats mainly come from India, Sri Lanka, China, Pakistan, South Korea, Taiwan, and some European and African Countries as per security and immigration sources.
Indian publication, Daily Industry (2018), in their report showed that Bangladesh has become 4th largest remittance source for India with US$10 billion in 2017. They also reported that about 1 million Indian workers working in Bangladesh, mostly, through illegal channels. As per Reserve Bank of India, this amount is deposited in different Indian banks with the declaration. The actual value through non-declaration could be even higher. Though Bangladeshi E-paper, Daily Sun (2018), has claimed it to be false news and further claimed that Bangladesh earns 35 times that of India earns from us. Such contradictory reports reflect our level of patriotism towards solving the drainage from remittance outflow.
Threat from foreign professionals
A Study carried out by Islam et. Al (2017) for Center of Excellence for Bangladesh Apparel Industry (CEBAI) revealed that expats have specialized skills in communication, negotiation, leadership, decision-making, and operational skill and are reported to be paid two to five times higher than the local professionals.
Categorically, we cannot say that professionals working in our textile and RMG industry are facing tough competition from foreign nationals. It is because most of our local professionals are nowadays highly educated, experienced, and gained industry exposure to run by themselves. Then why are we nourishing such highly paid foreign nationals against our national interest?
For decades, our textile and RMG factory owners believed that foreign experts are more skilled and there are a few still believe the same way. Firstly, it is not uncommon not to get the best result with some specific local professional but from here making a generalization would be a fallacy.
Read More: Is the foreign expert more capable than locals?
Secondly, it is also a part of some bad politics. There are lots of liaison offices working in Bangladesh. Many of those offices, mostly US-based, controlled by their regional office located in our neighboring country. In those offices, the decision-making employees are foreign national from a neighboring country. The factory people doing marketing is also from that country. Even many professionals and technicians of that factory are also from that foreign country. It is like making of a little cantonment or a gang of foreigners in those buying office and factories whereas the same responsibilities (may not be the purpose) can be served by local professionals at a low cost. The reason I mentioned purpose because social and cultural aspects should not be a bar in international business which is greatly driven by technical knowledge and most of the people nowadays understand the English language. The possibility of unethical trading as a team cannot be denied too.
Lastly, many of the owners are accused of money laundering by using their highly paid foreign employees as a medium for transferring money to other countries.
Most of these foreign professionals working in this textile and RMG industries do not have a valid work permit. Most of those come to Bangladesh in tourist visas and extend their visa by liaising with immigration officials. There are lots of talk about this but no action had been taken about this very simple legal matter. Bangladesh has been a target of terrorist attacks and it is not unlikely that there are foreign agents dwelling in Bangladesh in the guise of a garment expert.
Most of the foreign offices employ Country Managers preferred to be non-Bangladeshi. The government must check their skill, experience and managerial capacity in order to give them work permit with a valid reason for working in Bangladesh.
One of the reasons buyers need them is to screw prices, put penalties and recover claims. Whereas, in such position, a local national would perform much better at a reasonable price to get the right quality for on-time shipment. Understanding the local culture is very important for the Country Managers. If you talk to any of them working here for more than 10 years will speak very badly about our working condition, delivery, on the other hand, push us to be 10 cents cheaper than last season. This whole thing is not only relegating our good name in the international market but also the country is renounced from foreign currency.
Most ridiculous thing is that you got to ask this question when, why and where we do need a foreign expert. It is not only the case that they are working as Country Managers or General Managers. They are working massively in woven mills and we should admit that we might still have some lacking in that area, especially in dyeing and finishing. But you will find them working in laboratories, R&D, warping, sizing, and looming, etc. areas too. Though Bangladesh is a forerunner in knit composite but yet you will find foreign professionals in knitting, dyeing, finishing and even in cutting, pattern making, sample making, quality control, fashion design, washing plants, accessories factories, fabric marketing, yarn marketing, etc.
However, I must not admit that there are a few advantages of hiring foreign professionals. They work hard because they do not have any social works here. They do not leave the job in short notice. An office with foreign staffs gives customers the feeling of visiting in a multi-national corporation. And of course, individuals have their own personal charisma which makes them different from others.
Recommendations
It is very easy to leave some recommendations to improve the present scenario. Ironically, everybody understands the fact but do not take any actions about it.
Firstly, we have the correct data. The Ministry of Labor and Employment does not have any data related to the actual number of foreign employees working in our country. According to various reports, it could be higher than a staggering 1 million foreign workers and from valid sources, it is half a million workers. We need the actual count in order to control it.
Secondly, MNCs often assign expatriate to facilitate knowledge transfer and enhance foreign direct investment purpose. Here is this case, we need to check the capability of the foreign expats working here to teach our technicians, managers. In case, they are here only to learn we are making big accounting mistake by assuming them as FDI.
Thirdly, according to the Income Tax Ordinance 1984, tax officials can impose a penalty on companies up to 50 percent of their total payable income tax, or BDT 5 lakh, and deny all other tax benefits as a fine for hiring unauthorized foreigners. It is now up to the integrity of the tax department to investigate those or they keep quiet of being allured with greater personal benefits.
There are also a few other recommendations which are the key topic for today’s discussion. That is, how to make our textile and RMG industry safe and sustainable for Bangladeshi professionals.
Many of our textile and garment owners complain about the poor knowledge and English literacy of our local professionals. It is very common that academic knowledge, experience, and English as communication will not be the same for everybody. In general, the expats working in our industry has on an average better English. This does not mean that there is no local professional who speaks better English than expats. Nowadays, there are young breeds from public and private universities educated in textile engineering, fashion design, business administration, physical science, applied arts, and many of them having a foreign degree from renowned universities. They could be a much better worker for now and for the future who can work for the company for the rest of his/ her life.
There must be some professional institutes like there is for Doctors, Engineers, or even Lawyers where the professional institutes will be able to certify the employability, and also conduct technical and management workshop, a symposium to improve the skills and knowledge of local professionals.
It is natural, in Bangladesh, to have good demand for technicians, managers, merchandisers, marketers, etc. However, we have complaints about them that they leave the job even with a small raise from other companies. One of the most popular theories on motivation was given by Frederick Herzberg (1959) which sets forth management theories for workers. He believed that workers are motivated anything other than money. Those are praise, responsibility, achievement, and advancement. Our industry owners are in fact lagging behind in their knowledge in management theories by believing in Taylor (1900) theory where money is the only motivator. Many of the factory owners are applying Herzberg theory in practices, and there are a lot of examples where the best performers in the industry are management hires young managers, gives them the responsibility, praise them while performing, rewards when achieves and promote them as advancement.
In today’s world, everybody wants to have a young worker who is keen to learn. It is because of the change in technology, work processes, motivational factors, etc. As the phrase says, “unlearning is difficult than learning”, it is wise to recruit young staff who later is trained with various on the job training so as to capable of giving new knowledge for improving the work process.
If we compare the compensation package between the expat and local professionals then there is a big difference. If the local professional is more qualified we still do not want to offer the same package that we offer to a foreign professional with more than US$10,000 as salary plus house rent US$2,000 plus airfare twice a year with family and profit bonus. How could we expect the same dedication from a local professional giving only a part of it and expecting he would sacrifice all his social and personal life? For real professional, they deliver results not his working hours like foreign professional work in Bangladesh. Next thing is that the factory owners must introduce pension and gratuity like other countries which are used as an effective tool against employee’s turnover. Richard Branson, one of today’s most illustrious and successful entrepreneur, quoted about employees, “Clients do not come first. Employees come first. You take care of your employees, they will take care of your clients”.
References:
BGMEA, 2019. “Total Export of Bangladesh”. Available At: http://www.bgmea.com.bd/home/pages/tradeinformation
BIDA, 2019. Available At: https://www.unescap.org/sites/default/files/Changes%20of%20FDI%20policy%20in%20BD%20ESCAP%2717V2.pdf
CIA, 2019. “South Asia: Bangladesh”. Available At: https://www.cia.gov/library/publications/the-world-factbook/geos/print_bg.html
CPD, 2015. “CPD Study on Bangladesh as Indian Remittance Source”. Published on January 7, 2015. Available at: https://cpd.org.bd/cpd-study-bangladesh-indian-remittance-source/
Daily Industry, 2018. “Bangladesh Becomes 4th Largest Remittance[1] Source for India”. Published on July 02, 2018. Available at: http://www.dailyindustry.news/bangladesh-becomes-4th-largest-remittance-source-india/
Daily Sun, 2018. “False Propaganda about India’s Remittance from Bangladesh by Enamul Hassan”. Published in August 2018. Available at: https://www.daily-sun.com/printversion/details/331504/2018/08/26/False-Propaganda-about-India%E2%80%99s-Remittance-from-Bangladesh
Dhaka Tribune, 2018. “Apparel workers in Bangladesh still the lowest paid by global standards”. Business. Available at:
Islam, S. and Islam T. N., 2018. “Insight into the Skill Development Issues of Management Jobs: A Study on RMG and Textile Sectors of Bangladesh.” Canadian Center of Science and Education. November 29, 2018. Available At: https://www.researchgate.net/publication/329279167_Insights_into_the_Skill_Development_Issues_of_Management_Jobs_A_Study_on_RMG_and_Textile_Sectors_of_Bangladesh
Islam, S. R., Hossain, M. I., Islam, M. T., & Tareq, M. (2017). Employment of Expatriates and its Alternatives in
the RMG sector of Bangladesh. Report of Centre of Excellence for Bangladesh Apparel Industry. Retrieved
Islam, S. R., Hossain, M. I., Islam, M. T., & Tareq, M. (2017). Employment of Expatriates and its Alternatives in
the RMG sector of Bangladesh. Report of Centre of Excellence for Bangladesh Apparel Industry. Retrieved
Islam, S. R., Hossain, M. I., Islam, M. T., and Tareq, M., 2017. “Employment of Expatriates and Alternatives in the RMG Sector of Bangladesh”. Report of CEBAI. Available At: https://www.researchgate.net/publication/329279167_Insights_into_the_Skill_Development_Issues_of_Management_Jobs_A_Study_on_RMG_and_Textile_Sectors_of_Bangladesh
Leon, T., 2018. “Herzberg and Taylor’s Theories of Motivation”. October 15, 2018. Available At: https://smallbusiness.chron.com/herzberg-taylors-theories-motivation-704.html
Netherlands Bangladesh Business Forum, 2007. “Economic Outlook”. Available at: http://www.nbbp.org/EconomicOutlook
New Age, 2018. “Foreign Nationals Working Illegally Go Unchecked by Moinul Haque”. Published on May 10, 2018. Available at: http://www.newagebd.net/article/36422/foreign-nationals-working-illegally-go-unchecked
Nikkei Asian Review, 2018. “Bangladesh Fights for Future of its Garment Industry by Mitsuru OBE”. Business Trend. Published on November 4, 2018. Available At: https://asia.nikkei.com/Business/Business-trends/Bangladesh-fights-for-future-of-its-garment-industry
SDG, 2017. “Bangladesh’s Broad Journey: From the MDGs to the SDGs by Karolina Mzyk”. October 20, 2017. Available At: https://www.sdgphilanthropy.org/from-the-mdgs-to-the-sdgs-in-bangladesh
Textile Today, 2018. “By the End of The Current Fiscal Year in June 2018, Bangladesh will have three Financial Years Remaining to take its Apparel Export to USD 50 Billion by Tareq Amin”. July 1, 2018. Available At: https://www.textiletoday.com.bd/10-reasons-bangladesh-will-not-able-achieve-50-billion-apparel-export-2021/
The Daily Star, 2015. “Foreign Employees on the Rise in Bangladesh”. Business. December 31, 2015. Available at: https://www.thedailystar.net/business/foreign-employees-the-rise-bangladesh-194584
The Daily Star, 2012. “Bangladesh – – A Part of the Next 11 by A. R. Chowdhury”. Published on May 15, 2012. Available at: https://www.thedailystar.net/news-detail-234135
