Improving the Conditions of Workers? Minimum Wage Legislation and Anti-Sweatshop Activism

by Ann Harrison, Jason Scorse



Many claim that international labor standards are a remedy to address poor working conditions and low wages in developing countries. Others have argued that efforts to impose a “living wage” or improve working conditions in developing countries can lead to higher labor costs, which could in turn hurt the very workers these movements seek to protect by relegating these workers to even worse jobs or no jobs at all. Many labor rights activists have turned to public relations campaigns and boycotts that target multinational companies in order to pressure them to improve the conditions of their workers. In the 1990s, Indonesia—home to dozens of Nike, Reebok, and Adidas subcontractors—was a primary target for these activists. At the same time, the Indonesian government—prompted by the U.S. government—greatly increased its minimum wage. These two different interventions led to a doubling of wages for unskilled workers in Indonesia. While the minimum wage increases did lead to employment losses, this article reports on a study that shows that employment remained steady in textiles and apparel, indicating that anti-sweatshop activism in Indonesia was a “win-win” situation.

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