Will New Factory Jobs Offer Wages and Conditions that "Will Allow Haitians to Feel Proud"?

December 22, 2011

A recent report by Haiti Grassroots Watch examines Haiti’s much trumpeted apparel manufacturing, planned for significant expansion with the new Caracol Industrial Park, which is “being built with 124 million dollars of U.S. taxpayer funds, and another 55 million dollars from the Inter-American Development Bank.” At the park’s groundbreaking ceremony last month, Haitian President Michel Martelly said “Haiti is open for business,”  and “This model of investment will allow Haitians to feel proud.” Reuters reported that “Martelly said the park could eventually provide jobs for 65,000 workers, which would increase Haiti’s garment industry workforce by more than 200 percent.”

But among HGW’s key findings are that:

  • Haitian workers earn less today than they did under the Duvalier dictatorship.
  • Over one-half the average daily wage is used up to pay for lunch and transportation costs to and from work.

HGW’s investigative reporters interviewed a factory worker named Evelyn Pierre-Paul, who

hasn’t been able to save up a year’s rent yet. Twenty-three months after the catastrophe that killed hundreds of thousands, she and her children are still living under a tent in one of the capital’s hundreds of squalid refugee camps.

Pierre-Paul’s average daily take-home wage is actually more than Haiti’s minimum factory wage of 150 gourdes, or 3.75 dollars, a day. She earns about 236 gourdes, or 5.90 dollars a day. But that doesn’t cover even one-quarter of what would be considered a family’s most basic expenses.

HGW also notes that

A recent study by the U.S.-based Solidarity Center, which is linked to the AFL-CIO trade union federation, determined that a “living wage” for a worker with two children is 749 dollars a month – almost five times the average monthly wage.

Pierre-Paul’s wage – about 150 dollars a month – is far from “living”. She can’t afford to send all her children to school. She can’t even afford to move out of the squalid camp.

Pierre-Paul’s boss, One World Apparel owner Charles Baker, admits that he doesn’t pay his workers enough.

“If a person is honest, it’s clear that it’s not enough,” Baker, a two-time presidential candidate, told HGW. “If I could give a worker 1,000 gourdes a day, I’d pay that. But the conditions in Haiti don’t permit us to pay 1,000 gourdes.”

But are factory owners such as Baker solely responsible for the low wages?

Baker and other factory owners claim they can’t pay more because of they did, their international clients – like Gildan Activewear, Hanes, Levis, GAP, Banana Republic, K-Mart and Wal-Mart – would pick up and move out. And so the Haitian government – with the full backing of the U.S. government, as recent Wikileaked cables revealed – remains the lowest wage in the hemisphere-wide “race to the bottom”.

“Yes, it’s a race to the bottom… if you count on it!” Baker said.

But investors and policy planners in both the Haitian government and outside it (such as Bill Clinton), do seem to be counting on it. Clinton and other influential figures gave strong backing to economic development proposals [PDF] put forward by economist Paul Collier even before the earthquake, with a strong emphasis on apparel production. But

Baker claims that low-wage, low-skilled assembly industries are temporary, and that they will be a big part of the Haitian economy for only about “10 or 15 years”.

“It’s a step. We’re going up the stairs and it’s one of the steps,” he said.

Haiti has been on the same step for almost 30 years. [See story #4]

Low wages are not the only part of the “race to the bottom” in labor flexibility that factory owners like Baker use to bid for contracts for major foreign retailers. HGW reports

In the meantime, Baker and other Haitian factory owners remain vehemently anti-union, according to workers like Pierre-Paul and according to a recent study by the United Nations-affiliated International Labor Association/Better Work programme.

In an April 2011, report, the Haiti branch of the agency noted, “very significant challenges related to the rights of workers to freely form, join, and participate in independent trade unions in this industry in Haiti.”

Indeed, five months later, about a week after textile workers in the capital registered a union, all five union leaders suddenly lost their jobs. Better Work recently ruled the factories should reinstate all union officers but as of Dec. 12, most of the owners had not complied.

In part two of their report, HGW describes how the planned industrial park could push people from farming to low-wage factory labor, in a very direct way:

The area chosen for the country’s new 243-hectare Caracol Industrial Park is near the coast, halfway between the northern cities of Cap- Haitien and Ounaminthe. It was recommended by a U.S.-based consulting firm hired by the Ministry of Economy and Finances (MEF), Koios Associates. Koios’s September 2010 study said the site was ideal, in part because the land was “devoid of habitation and intensive cultivation”.

Except it wasn’t quite “devoid”. The Caracol site was home to 300 farming plots.

“The place they chose to put the park is the most fertile area of the department,” farmer Renel Pierre explained to HGW. “In Chambert, they grow plantains, beans, manioc and other things. If, for city people, their ‘treasury’ is their savings account book, for peasants, their ‘treasury’ is this land.”

But last January, without notice, contractors put fences around 243 hectares, mostly lands that had been leased by peasant families from the state for decades. Most of the farmers have been paid for their lost crops, and many have been offered replacement land, but in less fertile areas.

Putting an industrial park – which will attract between 20,000 and 200,000 new residents – in the midst of a fertile area is not necessarily going to contribute to Haiti’s “sustainable development”, despite government claims to the contrary, economist [Camille] Chalmers notes. Haiti has gone from virtual food self-sufficiency three decades ago to importing over 60 percent of its food. Taking more land out of production will only increase that figure.

Further on, HGW reports that

Perhaps just as disturbing is the fact that the park is being set up in the middle of one of Haiti’s major watersheds. But, according to the Koios study, this is precisely the reason the site was chosen, because “it is capable of absorbing a large volume of treated water.”

Despite being slated to be home to Haiti’s first modern textile mill – which will be using toxic dyes – the Caracol park is being built only about five kilometres from the Caracol Bay, home to some of the country’s last mangrove forests and coral reefs.

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