Workers get only 4pc of price of clothes sold in Australia: Oxfam

Just 4 percent of the price of a piece of clothing sold in Australia goes toward workers' wages in factories across the globe, according to a new study by Oxfam released yesterday.

The research, which is the first of its kind in Australia, shows an even dire situation in Bangladesh, where wages are extremely low. On average, just 2 percent of the price of an item of clothing sold in Australia goes to the wages of factory workers.

While many leading and iconic Australian fashion brands are enjoying increases in revenue, the workers making the clothes -- the vast majority of whom are women -- are trapped in a cycle of poverty, said the report titled 'What She Makes'.

“The women making the clothes Australians love and wear are being denied decent lives by being paid poverty wages and are unable to afford even the basics no matter how hard they work,” said Helen Szoke, chief executive of Oxfam Australia.

Women are working six-day weeks and as much overtime as they can, and yet they are forced to live in slums, often separated from their children and families, and going without enough food as they struggle to make it to their next pay.

But the report, which was prepared by Deloitte Access Economics, argues that it is possible for big brands to pay living wages -- wages earned in a standard week that cover essential needs including food, housing, healthcare, clothing, transport, education, and some money for unexpected events.

Deloitte estimates that even if big companies passed the entire cost of paying living wages to all workers on to consumers, this would increase the price of a piece of clothing sold in Australia by just 1 percent.

“That is just 10 cents extra for a $10 T-shirt, Szoke said.

With the profits being made by the factory owners, wholesalers and retailers of the fashion industry, Oxfam says it is more than possible for the cost of paying living wages to be absorbed in supply chains.

“Fashion is big business in Australia -- turning over $27 billion last year alone and growing at 4 percent a year.

Yet the women who make our clothes remain entrenched in lives of poverty, paid as little as 39 cents an hour. It is time for this grossly unfair system to change.”

Szoke said Oxfam was calling on the companies behind Australian fashion brands to commit to paying a living wage to factory workers in their supply chains -- and to publishing a step-by-step strategy outlining how this would be achieved over six years.

Alongside the report, Oxfam has released a live company tracker to publicly monitor Australia's leading fashion retailers -- brands such as Kmart, Big W, Bonds, Cotton On and Just Jeans -- and their progress on paying living wages.

Brands have the power and responsibility to ensure workers are paid enough to live with basic dignity, Szoke said.

“We are asking Australians to speak up. Together we can hold brands accountable for what women make -- telling them loud and clear the time has come to pay living wages.”