The real cost of Shein’s clothing: long hours and low pay

Summary

Marketplace Morning Report: The Real Cost of Shein’s Clothing – Long Hours and Low Pay

Episode Release Date: January 13, 2025

In this episode of the Marketplace Morning Report, Marketplace delves into the troubling labor practices behind the fast-fashion giant Shein. Hosted by Liana Byrne and featuring on-the-ground reporting by BBC's Laura Bicker, the episode unpacks the harsh realities faced by workers in Chinese factories that supply Shein, explores the broader economic implications, and examines the potential ramifications of Shein’s planned listing on the London Stock Exchange.

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1. Shein’s Labor Practices: An Inside Look

The episode opens with Liana Byrne introducing the investigative findings of the BBC, revealing that workers in Chinese factories manufacturing for Shein endure grueling conditions. According to the BBC's China correspondent, Laura Bicker, employees in the so-called "Shein Village" work over 75 hours a week and are paid less than one dollar per item produced, starkly violating Chinese labor laws.

Notable Quote:

“More than a dozen workers told the BBC they do this for 75 hours a week in contravention of Chinese labor laws. Most have only one day off a month.”
— Laura Bicker [01:41]

2. On-the-Ground Reporting: Daily Realities of Shein Workers

Laura Bicker provides a vivid portrayal of the working environment within Shein’s factories in Guangzhou. Workers engage in monotonous tasks such as stitching and steaming fabrics while listening to podcasts or cooking shows to pass the time. The relentless pace leaves little room for rest, with many workers having only one day off per month.

Factory Worker Insights:

“It depends on how difficult the item is. Something simple like a t-shirt is 1 to 2 yuan per piece and I can make around a dozen in an hour. We earn so little. How is that enough? The cost of living is now so high.”
— Factory Worker [02:47]

Many workers migrate thousands of miles to Guangzhou to support their families, with Shein emerging as a primary employer in the region. The availability of nearby fabric suppliers and the high demand for Shein’s products have cemented the company’s dominance in the local textile industry.

3. Advocacy and Human Rights Concerns

The episode features insights from David Hatchfield of the Swiss advocacy group Public Eye, who highlights the severe exploitation within Shein’s supply chain.

Notable Quote:

“For Shein, it's an extreme form of exploitation that happens and this needs to be visible.”
— David Hatchfield [04:31]

Public Eye’s revelations add to a mounting list of concerns regarding forced labor, long hours, and inadequate pay in factories producing for Shein. These practices not only breach labor laws but also infringe upon basic human rights, drawing international scrutiny.

4. Shein’s Response and Commitments

In response to the allegations, Shein asserts its commitment to fair and dignified treatment of all workers within its supply chain. The company claims to be investing tens of millions of dollars to enhance governance and compliance standards, striving to set high pay standards for its employees.

Shein’s Statement:

“We are committed to ensuring the fair and dignified treatment of all workers within our supply chain.”
— Shein Representative [04:58]

Despite these assurances, workers remain skeptical, with many feeling compelled to endure harsh conditions as a duty towards their country’s development.

Worker Sentiment:

“This is what we Chinese need to sacrifice for our country's development.”
— Factory Worker [05:32]

5. Economic Context: China’s Trade Surplus and Market Dynamics

Transitioning from labor issues, Liana Byrne discusses the broader economic landscape, highlighting China’s unprecedented trade surplus of nearly US$1 trillion in the previous year. This surge, driven by increased exports and sluggish import growth, reinforces China’s position as the world's largest trading nation but raises concerns among its trading partners.

Notable Quote:

“China's surplus has been boosted by a surge in exports and a slower growth in imports. It added up to an extraordinary 990 billion dollars last year.”
— Mickey Bristow [07:06]

This massive surplus has prompted foreign governments to consider imposing restrictions on Chinese imports. The incoming U.S. administration, led by President Donald Trump, has already signaled intentions to impose tariffs, potentially escalating trade tensions.

6. Shein’s Potential Listing on the London Stock Exchange

The episode explores the implications of Shein’s contemplated listing on the London Stock Exchange. Katie Silver of the BBC underscores the significance of this move, noting that Shein must navigate stringent regulatory requirements and enhance transparency to gain market confidence.

Notable Quote:

“It's hugely difficult. It's a long process. And there have been calls to increase transparency by Shein if they do indeed want to go through with this listing.”
— Katie Silver [07:57]

Shein’s rapid growth over the past five years, with sales spanning more than 150 countries, is marred by controversies including forced labor, poor working conditions, and intellectual property disputes. These issues pose substantial challenges for Shein as it seeks to bolster its reputation and meet the rigorous standards of international stock markets.

Intellectual Property Concerns: Katie Silver highlights accusations against Shein for stealing designs from independent designers, who complain that Shein replicates their creations and sells them at a fraction of the original price, exacerbating tensions within the fashion industry.

7. Conclusion: Weighing the Costs and Future Prospects

The episode concludes by reflecting on the multifaceted challenges Shein faces as it balances rapid expansion with ethical and regulatory compliance. While Shein’s success contributes significantly to China’s export prowess, the human cost of such growth raises critical questions about the sustainability and morality of fast fashion.

For listeners seeking more in-depth coverage, the BBC offers a comprehensive article on Shein’s labor practices on their news website.

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Key Takeaways:

• Excessive Labor: Shein’s factories in Guangzhou subject workers to over 75-hour workweeks with minimal pay, violating labor laws and basic human rights.
• Economic Impact: China’s substantial trade surplus underscores its dominance in global trade but also fuels international tensions and calls for import restrictions.
• Regulatory Challenges: Shein’s potential listing on the London Stock Exchange faces significant hurdles due to ongoing controversies and demands for greater transparency.
• Ethical Concerns: Accusations of forced labor, poor working conditions, and intellectual property theft highlight the darker side of Shein’s business model.

This comprehensive examination by Marketplace Morning Report sheds light on the hidden costs behind affordable fashion, urging consumers and stakeholders to consider the human and ethical implications of their purchasing decisions.

Transcript

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[Liana Byrne]

Of Sheen's Clothing Long hours and low pay Live from the uk, this is the Marketplace Morning Report from the BBC World Service. I'm Liana Byrne. Good morning. The BBC has found that workers in Chinese factories making clothes for the fast fashion giant Shein are laboring more than 75 hours a week and earning less than a dollar an item. The BBC's findings will add to a growing list of questions about working conditions in its factories. The BBC's China correspondent Laura Bicker spent the day speaking to workers in the so called Shein Village.

[Laura Bicker]

We're in the beating heart of a global empire. The machines seldom stop in this factory producing clothes for the fast food fashion giant Shein. The workers listen to podcasts or cooking shows as they stitch or steam fabrics. More than a dozen workers told the BBC they do this for 75 hours a week in contravention of Chinese labor laws. Most have only one day off a month. Outside, scooters rush through a warren of more than 5,000 factories which make up the so called Xi'an Village in Guangzhou. At a nearby job market, workers looking for a daily paycheck examine the stitching of the kind of clothes they'd be expected to make. They get paid per piece. Their skill and speed dictate how much they make.

[Unknown Reporter]

What do you usually make?

[Factory Worker]

It depends on how difficult the item is. Something simple like a t shirt is 1 to 2 yuan per piece and I can make around a dozen in an hour. We earn so little. How is that enough? The cost of living is now so.

[Laura Bicker]

High, workers travel thousands of miles to Guangzhou to earn money to send back to their families Shein is now one of their major employers.

[Factory Worker]

I work with Shein at their first year. I watched it grow. I think Shein will get stronger and better.

[Laura Bicker]

There's an almost constant supply of fabric from nearby vendors. Shein's success has been possible because this city in China has everything it needs.

[Unknown Reporter]

We've come to the textile district of Guangzhou. It's only about 10 minutes from the actual factories and it is a bustle. This lunchtime, there are dozens of workers lifting heavy rolls of fabric onto trucks, onto cars and onto, would you believe it, scooters. Now, I have no idea how they are balancing it, but on one scooter there's at least seven rolls of fabric.

[Laura Bicker]

Later, as dinner time approaches, street vendors set up stalls selling food or even offering haircuts for workers on their dinner break. Long hours are simply a way of life and a 75 hour week is not unusual in this industrial heartland.

[David Hatchfield]

Well, it's not unusual, you say, but it's clear that it's illegal and it violates basic human rights.

[Laura Bicker]

David Hatchfield is from the Swiss advocacy group Public Eye, which has also uncovered excessive working hours in factories producing clothes.

[David Hatchfield]

For Sheehan, it's an extreme form of exploitation that happens and this needs to be visible.

[Laura Bicker]

In a statement, Sheehan told the BBC that it is committed to ensuring the fair and dignified treatment of all workers.

[Unknown Reporter]

Within its supply chain.

[Laura Bicker]

And Sheehan says it's investing tens of millions of dollars in in strengthening governance and compliance. Shein also said it was striving to set the highest standards for pay. As workers head in for the last few hours of their shift, some tell us it's their duty to work hard.

[Factory Worker]

This is what we Chinese need to sacrifice for our country's development.

[Unknown Reporter]

It's just gone 10pm and finally some of the factories are beginning to empty. They're filing out, jumping onto their scooters and heading home. They won't live too far away. Many of them have dormitories nearby or they live in small apartments. But I'm standing outside one factory that is still going and deliveries are still happening. It seems in this part of China, the textile capital of the world is not a place that ever fully goes to sleep in China.

[Laura Bicker]

I'm the BBC's Laura Bicker for Marketplace.

[Liana Byrne]

Now let's to the numbers. The pound is under pressure again, falling 4,10 of a percent to $1.21 after hitting its lowest level since late 2023 last week. Government borrowing costs are climbing too, with 10 year bond yields at their highest since 2008. And 30 year yields hitting a 27 year high of 5.5%. And the Indian rupee is down 7,10 of a percent, its biggest single session loss in almost a year as investors bet that the US Fed may not cut rates anytime soon. Now China has reported its largest ever trade surplus amounting to nearly US$1 trillion last year. It's good news for China, less so for its trading partners. Here's the BBC's Mickey Bristow.

[Mickey Bristow]

China's surplus has been boosted by a surge in exports and a slower growth in imports. It added up to an extraordinary 990 billion dol last year. A Chinese spokesman said the country had solidified its position as the world's largest trading nation. There's hardly anywhere that its goods don't reach. But the huge surplus is likely to fuel calls by foreign governments for restrictions on Chinese imports. Donald Trump, the incoming US President has already said he'll impose tariffs.

[Liana Byrne]

Mickey Bristow there. Okay, let's get back to Shein. Of course, it's one of the companies helping China's exporting success. And the prospect of privately owned Shein listing on the London Stock Exchange has been talked about since last year. So how significant is that potential move given the controversy that is swirling around us? Here's the BBC's Katie Silver.

[Katie Silver]

As part of all of this, many analysts saying that they want to improve their reputation ahead of this intended listing. It's hugely significant. The markets that big companies choose to list in, be it in the US In Hong Kong, in London, they've got to jump over significant regulatory hurdles in order to, to have that take place. We have seen companies delisted, for example, Chinese companies in the US as part of a, you know, a crackdown of what they saw as state sponsored companies. So it's hugely difficult. It's a long process. And there have been calls to increase transparency by Sheehan if they do indeed want to go through with this listing. As, as Laura was saying, only five years that it's been in operation selling to more than 150 countries. But there are questions about, as she mentioned, forced labor, treatment of workers, long hours, short term contract work that doesn't give people job security, the issue of child labor as well as Shein facing accusations that it sources cotton from Xinjiang, the Xinjiang region, the industry has been accused of using Wigan Muslims to make this cotton. And then finally as well, one of the other major accusations against Shein comes to intellectual property and many designers and independent designers saying that they steal designs they have made and showing, for example, posting on social media, their designs and then. And then what? Sheen sells at a very small fraction of the price.

[Liana Byrne]

Katie Silver there. If you want to read more on that Sheen story, there's a long read on the BBC news website. And that's it from the Marketplace Morning Report from the BBC World Service. Naomi Rainey is our producer today. James Graham's the editor. And I'm Liana Byrne. Have a great day. Thanks for listening.

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[Mickey Bristow]

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