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The least bad option: Sweatshops in the developing world

FEBRUARY 10, 2012
by William Mitchell ’14, Contributing Writer

“Bad jobs at bad wages are better than no jobs at all.”

This is a controversial statement from a controversial speaker, but Benjamin Powell is used to shocking people. An assistant professor of economics at Suffolk University, Powell spoke at a Conservative Students for a Better Tomorrow event Tuesday titled “In Defense of Sweatshops.”

A specialist in development and public choice economics, Powell claimed that for people in developing countries, jobs in sweatshops are far better than the alternatives. The most common alternatives to sweatshop labor in many of these countries are substance agriculture and destitute poverty.

Powell noted that these alternatives could be especially damaging to children. Children forced out of the manufacturing sector put in long hours in fields in the sun or, in worse cases, turn to prostitution. Powell claimed that until incomes as a whole rise, child labor will persist with or without the presence of sweatshops.

“There’s this idea that once child labor is outlawed that they get to go to Western schools, but that’s not the case. They just move to another sector of the economy.”

Powell claimed that in reality there is little the government could do to increase worker’s wages. If a minimum wage is enforced, then the factories could no longer turn a profit and would close. This would condemn the workers again to subsistence agriculture and destitute poverty.

Enforcing better working conditions could have equally damaging effects. When employers are forced to improve working conditions they lower wages to compensate for the cost. Lower wages mean workers can purchase fewer goods, dampening economic growth.

Powell ultimately claimed that if people really want to help people working in sweatshops, they should step up their efforts to purchase products from sweatshops. As demand increased, workers would also be in greater demand and wages would rise.

The role for Western countries in this would be to engage in ethical branding, in which purchasing from low wage manufacturing could become “cool.” Powell, however, soon qualified this claim.

“There’s things people can do, but it’s market-oriented and ultimately a small niche.”

Last updated February 17, 2016
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