Top 3 Ways Sweatshops Help The Poor Escape Poverty

Should sweatshops around the world be shut down? What might we say if we looked at sweatshops from the perspective of the world’s poor? While it may be true that sweatshops treat workers unfairly, Professor Matt Zwolinski says there are three points to be made in defense of sweatshops.

  • The exchange between the worker and the employer is mutually beneficial. Sweatshop jobs often pay three to seven times more than wages paid elsewhere in an economy. Workers in the developing world tend to view sweatshop labor as a very attractive option.
  • Even if sweatshop labor is unfair, it’s a bad idea to prohibit it. Taking away sweatshops just takes away an option for the poorest workers of the world. While countries can make it illegal for sweatshops to pay low wages, they cannot prevent sweatshops from shutting down and paying no wages. And when that happens, the workers all lose their jobs.
  • It is better to do something to end the problem of global poverty than it is to do nothing. Sweatshops are doing something to help. They are providing jobs that pay better than other alternatives, and they are contributing to a process of economic development that has the potential to offer dramatic living increases.

If we look at sweatshops from the perspective of the world’s poor, which looks better: the American company that outsources to a sweatshop and provides jobs in developing countries, or the American company that, because of its high-minded moral principles, hires only U.S. workers?

11 Comments

  1. Matt Wavle

    When people’s actions bring about harmful results, in direct conflict with their stated goals, why then do they ignore the results and justify their actions based solely on their worthy intentions?  Is their pride really more important than their stated goals?

  2. Adam Billman

    I suppose the first question is how do you determine the “needs” of the workers? Assuming we took your position and stated the companies should do what is right, we still need to know what right is and who gets to decide it. Certainly the company would want it to be low and the worker would want it to be high so we really cannot use either judgment. 

    We could try to peg it to prices of necessary goods. The meaning of necessary however is amazingly hard to pin down in a third-world country. In the states, we might require a car, air-conditioning, electricity, cell phone, and a wide variety of food and other goods. Someone in the third world however is used to much less than that. Cars are frequently outside all but the richest hands. Consequentially, people choose to live close to work. So even if we in the states decided that they should be able to afford a car and the money for maintenance of it, the third-world employee does not need the car. Likewise, cell phones are rare as well, and so the infrastructure to use them is sparse. This being the case, those are also useless. Frankly, we have no business trying to judge any wage earned in any third-world country because we are so far removed from the third-world, that we simply cannot make educated judgments regarding it.
    A better option is to let the free-market do what it does best. Let people choose where they want to work. No one will ever work somewhere if working there will literally not cover expenses so no one will starve who is employed. As for comparative advantage, no employee will work in a sweat shop that could earn anywhere else a better income from a different job. Assuming there is no government interference, there is no better system then the free market for determining the best value for their pay. As more people get more jobs at more firms and the labor market shrinks, the established businesses will have to pay more or else risk losing the more productive employees. Hence, while currently they live in poor slums, they will not always. Eventually the infrastructure will adjust, more people will become better educated, and that country will improve.
    As one final note, consider the USA in the early days of the 20th century. The average income would have been around a $0.40 a day for a low income job. This would have bought 1lb of bacon (hence the phrase “bringing home the bacon”). In less than 100 years, due to technological advance and infrastructure improvements, the average minimum wage recipient can now earn close to 2lbs of bacon per hour. Go to a grocery store and divide everything you see by $8.50. That will give you the number of hours of work it would take to earn that item. You will be amazed at how cheap everything is here.
  3. taschrant

    I understand when people bash sweatshops, but I think the most important point to be made when debating sweatshops is just what this guy said: What are the alternatives?

  4. supersonicsixteen

    You have to let people choose how to fill their own needs the best.  I for instance think I have the best idea of how to eat.  That being said, it would be wrong for me to make you eat a certain way. Does that make sense?

  5. supersonicsixteen

    Pride is very important to those that hold it.  It’s hard to understand for people like you and me who would rather deal with results.

  6. Anonymous

    Adam you should be ashamed of yourself. How can you call yourself a human being.These sweat shops are just profit centers for the big corp.taking advantage of the poor.You justify this by saying they are better off now.That is by your standards.You know as well as everyone else that the unions of America  are the reason for the increase in wages and safety.This would not have happened without them.Argue all you want about the market taking care of itself but you are dealing with human lives and treating them as second class or should I say lower class primates as you would have us believe is disgraceful.Your economics will get you a one way ticket to hell.

Leave a Reply

Your email address will not be published. Required fields are marked *