The Fair Work Monitor sheds light on persisting challenges in achieving fair wages and decent work in Cambodia’s textile industry. It focusses on wages, working conditions, and labour rights. The results are alarming, especially considering that Cambodia’s garment, textile, and footwear sector directly provides income for one-fifth of the country's households.
Towards fair work: Key findings from the 2024 Fair Work Monitor in Cambodia
How Cambodia’s textile workers face debt and strive for better living standards
“ These data help us as trade unions in our dialogue with companies and the government. It clearly highlights the urgent need for action to improve workers' lives. ”
Athit Kong, leader of Cambodian Confederation of Apparel Workers' Democratic Union C.CAWDU
Key findings from the 2024 Fair Work Monitor
Significant numbers of workers lack access to food and healthcare:
- 30% of workers have run out ofnfood in their household at the end of the month.
- 32% report they cannot buy the prescripted eyeglasses they need.
- 37% report they cannot afford the dental care they need.
- 42% lack money to buy medication, causing some to live with persistent pain.
The cost of living has fallen slightly, due to slowing inflation, lower energy prices and a cautious recovery in the Cambodian economy. However, workers' actual income (i.e. basic salary plus performance bonus, seniority bonus and travel allowance) is still insufficient to meet their basic needs.
The median total expenditure reported by workers - food, non-food expenditure, remittances and savings combined - is $412 per month. This means that at least half of respondents spend $412 or more per month on their living expenses, more than double the current minimum wage of $204.
Fifteen percent (15%) of respondents who reported borrowing money did so to buy food, indicating serious food insecurity among these respondents. Many respondents also reported borrowing money for other basic needs, such as transport to work and medical expenses.
Financial vulnerability and debt
- 73% of workers borrow money forn basic expenses, perpetuating cycles of debt.
- 82% cannot save for emergencies, leaving them vulnerable to unforeseen events.
- Parents and caregivers are particularly vulnerable, with higher costs and fewer savings.
A significant number of workers have to borrow money to cover basic expenses (73% of workers in 2024 compared to 77% in 2023). The median amount borrowed has started to increase in the past year, from $5,000 in 2023 to $6,000 in 2024. Some workers even report that they are in debt cycles, meaning that they borrow from one source to pay off another. This worrying trend is compounded by the fact that the majority of workers (82% in 2024 compared to 70% in 2023) have no money saved for unexpected events.
Parents and other carers are particularly vulnerable to these shocks. Workers with children dependent on their income account for 73% of all respondents. These workers have the lowest savings and the highest monthly expenses compared to single, married and widowed workers without dependent children. These findings are alarming, given that the garment, textile and footwear sector in Cambodia provides income for one-fifth of the country's households.
Recommendations for brands
To address persistent challenges, brands must:
- Revise retail and purchasing practices
Ensure strategies do not exacerbate low wages or precarious work. - Conduct meaningful due diligence
Engage directly with stakeholders and workers to identify and mitigate risks. - Support ACT collaboration
Actively participate in this initiative to strengthen collective bargaining and social dialogue.
ACT: A promising step forward
An important promising initiative that demonstrates the value of social dialogue among brands, trade unions, and other stakeholders in Cambodia’s garment sector is called ACT (Action, Collaboration, Transformation. This collaboration promotes collective bargaining agreements and living wages, supported by improved purchasing practices, setting a precedent for sustainable industry growth.
