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The Asian Industrial Revolution

A new piece in the New York Times shines a spotlight on the complexities of Asia’s industrial revolution, which is far more complicated than many understand. The piece focuses on Bangladesh, where a recent uprising at a garment factory and the subsequent response by police is only the latest in a string of labor conflicts, which are becoming increasingly dire:

Hundreds of workers gathered outside the front door of the factory in an impromptu sit-down strike. Eight workers, interviewed in June, said all the managers had left the factories. A small contingent of police officers soon arrived and ordered everyone back to work. A seamstress said a police officer knocked her to the ground, beating her unconscious with a stick and shredding her clothes. “I kept asking them to stop,” said the seamstress, who asked not to be identified, fearing reprisals. “But even after I fell to the ground, they kept beating me and pulled my hair.”

Workers began throwing stones and chanting slogans against the police, who fled. Hours later, after officials in Dhaka were notified, officers from the Rapid Action Battalion as well as surrounding police stations arrived. Officer Hossein, the police supervisor, denied that the police were aggressors, saying officers were told that foreign managers were trapped inside the factories and that angry workers were vandalizing equipment. “They attacked the police,” Officer Hossein said. “They started the violence.”

This unrest, in turn, is threatening the businesses and investment that have made Bangladesh:

For global brands, which are forever chasing the cheapest labor costs from country to country, Bangladesh has been a hot spot, especially as wages have risen in China. McKinsey, the consulting giant, has called Bangladesh the “next China” and predicted that Bangladeshi garment exports, now about $18 billion a year, could triple by 2020.

But in late July, representatives from 12 major brands and retailers, alarmed by the rising labor unrest, prodded the Bangladeshi government to address wage demands, a suggestion rejected by the labor minister. “No reason to be worried,” Khandker Mosharraf Hossain, the minister, told reporters, noting that brands were not canceling orders.

These events may seem shocking to western observers today, but they would be all-too familiar to western observers from past centuries. The actors in these revolts are the familiar ones from the early, textile fueled stage of industrialization first seen in the UK more than 200 years ago, which has since repeated since in many places around the world.

This situation is driven by the same complicated conditions that drove past industrial revolutions: a massive amount of surplus labor from a rising population needing to get off the farms, a low skilled work force and a paucity of jobs in the industrial sector.

But while these conditions are certainly bad, they do at least lead in a positive direction. As industrial development continues, so will the lives of the country’s workers improve as they become more skilled and as the country begins to attract higher-paying jobs to suit its increasingly skilled workforce. Meanwhile, these workers will gradually organize political groups (and, possibly, unions) able to push back against the abusive practices that are still common in Bangladeshi life.

Admittedly, this familiar process is complicated somewhat by the presence of both foreign capital and labor representatives from abroad, but this is nonetheless a classic early stage industrialization situation. Rather than trying to stop progress in its tracks, policymakers should concentrate on moving through the worst stages as quickly as possible so the country can move on to something better.

This means developing the education system, attracting higher-wage, higher-status industries, and gradually correcting the worst abuses of the system as it evolves. Meanwhile, Bangladesh isn’t going to look pretty, and a lot of people will face hard lives with not a lot of money or help, but at its worse industrializing Bangladesh is significantly better than the Malthusian horror scenarios of mass starvation regularly predicted for Bangladesh ever since the seventies. It isn’t utopia, but it’s a step in the right direction.

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  • Luke Lea

    McKinsey, the consulting giant, has called Bangladesh the “next China”

    Watch out, McKinsey, or you could start losing your credibility.

  • Michael Goodfellow

    What happens if we start doing this all with robots?

  • Jim.

    Unions really aren’t the enemy. Workers need protection.

    But the pendulum has swung too far in this country, and unions that defend unsustainable paychecks or pensions cause more trouble than they solve.

    I’ve long been an advocate of Unions assertively pursuing membership campaigns overseas. Go some of these places, and ask yourself, “Do American workers have it as bad as these guys here? Who’s in more serious need of the help that organization can provide?”

  • Michael K

    I find it interesting the Western retailers and brands want the gov’t to increase wages but gov’t says no. Why doesn’t the Western purchasers of Bangladesh textiles just increase wages at the factories making their product? One thing I would like to add the Bangladesh should invest in is infrastructure. One of the problems in Britain during the industrial revolution was the lagging investment in basic infrastructure like sewage and water in the new cities.

  • Jim.

    Could you cover the rise of India and China’s industrial base and nationalistic feelings in terms of the recent death of Neil Armstrong?

    Or just run an obituary, as that’s news in its own right?

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