Behind ‘fast fashion’ brands are underpaid workers working in sweatshops

Lured by the promise of a restaurant job paying $1,000 a month, Yeni Dewi travelled to the United States on a tourist visa in 2013. Once here, she realized she had been trafficked. She was forced to work as a domestic help at a house in Sherman Oaks near Santa Monica. She worked 18 hours daily and was paid $200 every 35-38 days. She managed to escape after a couple of years and has been a garment worker ever since.

Currently she works at a garment manufacturing factory near the intersection of Wall Street and 8th Street on the outskirts of the Fashion District in downtown L.A. Dewi said that the factory is a supplier for Fashion Nova. But she earns around $300-$350 per month even though she works for at least 40 hours every week.

“I don’t like the situation…but I have no other choice,” said Dewi, who is mother to a daughter here and a son who lives back home Indonesia with his grandmother.

Yeni Dewi with her daughter

According to a report by CIT Group Inc. and the California Fashion Association, the fashion industry in Los Angeles generates at least $18 billion in revenue. However, behind the world of mass-produced garments from fast fashion brands like Zara, Forever 21 and Fashion Nova, lies an underbelly of exploited workers receiving less than minimum wage and working in sweatshop conditions.

The minimum wage in the City of Los Angeles is presently $12 or $13.25 an hour, depending on the size of the business. According to the first quarterly report of 2018 of the California Employment Development Department, the hourly median wage of a worker in the garment and textile industry was $11.81. Despite state law mandating that all garment workers must be paid at least the minimum wage, many say that they don’t even get half of the designated amount.

“We are earning like $5 an hour right now, when every year it [the minimum wage] rises up to $12, $13 and so on,” she said. “In L.A, the minimum wage rises every year, but the piece rate never rises.”

According to the piece rate, each garment worker is paid around 70 cents for each “operation” like stitching the sleeves to the main body of a dress or joining the two sides of a shirt. Dewi said the total amount earned by a worker per garment depends on the style, but generally comes to around $2.

Mariella Martinez of the Garment Worker Center said that part of the reason that garment workers receive such low wages is that the big, sometimes multinational, brands that the factories supply refuse to increase their prices. This puts the onus solely on the owners of the factories to pay decent wages. The owners, in turn, are often unwilling to cut into their own profits. They also have to compete with manufacturing plants in Asia or Central or South America where labor is cheaper and labor laws are less stringent.

“If it is $15 an hour [for labor] in the United States and in California, that is a day’s labor in Mexico and two days’ labor in China,” said Ilse Metchek, the president of the California Fashion Association.

The Association, which Metchek said deals with, “the voice of the industry, the business of the business,” was formed in 1995 in the aftermath of the El Monte Slavery Case.

Metchek said that manufacturing has decreased in Los Angeles and will keep on decreasing over the years. The industry however is still huge. In 2016, Business Wire found that wholesalers in the industry added roughly 1500 jobs each year.

In 2016, researchers from UCLA studied the wage claims processed through the Garment Workers Center and found that workers earn an average of $5.15 an hour. Despite state legislation that holds manufacturers liable for wage and hour violations in the garment manufacturing industry, there is also little governmental oversight or enforcement.

Many of the factories operate illegally in garages, sheds, or abandoned properties, making it very difficult for government agencies to monitor them, said Dewi. They also do not provide health benefits, holidays or insurance and workers often have to work in sweatshop conditions.

Dewi has worked in factories where there were no bathroom or lunch breaks and the workers there had to bring their own clean water and toilet paper, she said.

Virgilda Romero, another garment worker, also described working in unsafe and unhygienic conditions.

“I worked at a factory between Broadway and Main streets on Adams where things were really bad…They would make me do a lot of the cleaning. So I would be in charge of cleaning the bathrooms and also like catching killing the rodents and then so I would deal with like rat pee falling on me and things like that,” said Romero. “I wouldn’t work sometimes on Sundays and they would leave the trash over, so there would be like maggots in the trash.”

Virgilda Romero at the Garment Worker Center

Romero arrived in the United States from Guatemala in 2001. She has worked in the garment manufacturing industry for more than 16 years. The first factory she worked at paid only 5 cents a piece. She has also worked in places where the employers would pressure her to work faster and not allow her to take any breaks. There have been times when she worked for 11 hours a day, Monday through Saturday, and sometimes even on Sundays to earn enough to survive.

Romero said that her present employer was much better and pays her around $470 for six-day weeks. Even then, when she informed her that she would be unable to work for some days due to a surgery, she got very upset and said, “You’re going to miss work again. You better get healthy quick so that you can come back to work as soon as possible.”

“I was very nervous because I’ve been taking these medications that make me have to go to the bathroom a lot because of the surgery and I was, you know, kind of scared the whole time that she would get angry for taking so many restroom breaks,” said Romero.

According to the California Bureau of Labor Statistics, 71 percent of the garment workers are immigrants, mostly Latinx and Asians. While both Romero now has valid work permit, many of the workers are undocumented immigrants and some are, like Dewi, victims of human trafficking.

The owners of the factories easily take advantage of their workers because they know that they are in precarious positions and will be too scared to go to the authorities to file wage claims or complaints about work conditions, Martinez said. Many are simply not aware that even though they are undocumented, they still enjoy certain rights.

For instance, Dewi did not speak English or Spanish when she first arrived in the United States. She was also not aware that she had certain rights as a victim of human trafficking. She was hiding both from her traffickers and also immigration authorities. She was scared that if she went to the police, they would arrest her for not possessing valid work permits. She did not realize that the garment industry was short-changing her as well.

“When I was working for my traffickers, they only paid me $200 [every 35 days]…and I didn’t get any holidays. In the garment industry, I got like $200 or $150 a week, and I thought it was good,” said Dewi. It was only after lawyers with the Garment Workers Center made her aware of her rights did she realize how low her wages were.

Dewi’s documentation is being processed and she hopes she will soon be able to apply for a green card and bring her son to Los Angeles.

As a member of the Garment Workers’ Center, Dewi often helps them with their campaigns. She said that most importantly the industry needs to abolish the piece rate.

“The first thing we are gonna to do is get minimum wage for the workers and then everything else, step-by-step, said Dewi. “We are gonna ask for health and safety and everything else.”

How Netflix Changed TV Forever

The 70th Primetime Emmy Awards in downtown Los Angeles last night saw a few attention-catching and even historic moments. Black-ish star Jenifer Lewis donned a bedazzled Nike sweatshirt on the red carpet in support of NFL player Colin Kaepernick’s controversial Nike ad and subsequent backlash. Oscars producer Glenn Weiss proposed to his girlfriend live on stage during his acceptance speech, an Emmys first. (Also, unprecedented: Last night’s broadcast pulled in 10.2 million viewers, the lowest ever ratings for the awards show.)

Unsurprisingly, HBO took home the most awards at 23, including the prestigious award for best drama series, maintaining its years-long streak. However, the No. 1 spot was shared by rival Netflix. This year marks the first time Netflix has claimed the top spot for most Emmy wins. The streaming service took third place at the 2016 awards and rose to the No. 2 spot last year.

Source: Business Insider    

Netflix is a pioneer in the on-demand media industry. It is a digital warehouse of TV shows, movies, documentaries, and educational shows. Those who pay a modest monthly fee gain unlimited access to its haul with the freedom to consume the content on any platform, be it TV, computer, or mobile device. Netflix is TV’s first serious contender in its nearly-century-long existence.

The streaming service started humbly as a provider of DVD rentals via mail. With its initial business model, Netflix was much more a rival of brick-and-mortar stores. When it rolled out its on-demand capabilities, it immediately became superior to the likes of Blockbuster and Movie Gallery. It didn’t take long for its competitors to fall to the wayside.

Acting on its motto of user flexibility over corporate efficiency, Netflix launched its first original series, House of Cards, in 2013. Since the immense success of the show, Netflix has drastically increased the amount of original content it produces. By offering captivating, on-demand content, Netflix has forced cable companies to reconsider the way they do business.

While networks greenlight new shows based on metrics, Netflix has offered contracts to showrunners for an entire season or two upfront. It also started giving entire seasons to audiences at once. (Binge-watching, anyone?) Most TV networks can’t afford to give up the ad dollars earned from the one-time-weekly dissemination model.

Netflix has also given showrunners creative freedom without corporate restraints, which has led to some of the platform’s biggest hits like Orange Is the New Black. Netflix is making it much harder for network television to secure top-notch talent.

In perhaps its best move against traditional networks, Netflix got aggressive in collecting data from its users. First used to help suggest appealing content to users, Netflix shifted and began to use the information to define which kinds of content it should create. Using this model has led to sky high rates of success with new shows.

Sealing the deal, a Netflix subscription is much more affordable than cable service. Starting at just $7.99 per month, Netflix is just a fifth of the price of some cable packages. Furthermore, there are no ads. No one likes sitting through 15 minutes of ads per 45 minutes of content, and that’s exactly how TV makes the bulk of its revenue. Canceling cable is the top fear of TV networks. If unbundled, they would have only their own merits to contend with. Netflix’s continuing success puts constant pressure on television networks.

 

 

Sources:

https://qz.com/1295998/netflix-is-making-it-harder-for-tv-networks-to-make-tv/

https://www.telegraph.co.uk/on-demand/2016/11/21/how-netflix-changed-the-way-we-watch/

How to choose ocean versus air shipping (hint: ocean usually wins)

Let’s start with the numbers.

The Port of Los Angeles moves the most containers of any port in the world, carrying 182.8 million metric tons of freight. Nearby Los Angeles International Airport moved 2.1 million tons of cargo in 2016.

Maersk is the world’s largest shipping company, with more than 16 percent of market share, 15 percent of all sea freight capacity, and 652 ships.

FedEx operates the world’s largest air freight business, moving 15.8 billion metric ton-kilometers’ worth of cargo on 657 planes from more than 375 airports.

You’ll notice that the sea freight business is significantly larger than air freight. But why?

Today’s newest and largest cargo ships can carry a lot more stuff a lot more efficiently. The OOCL Hong Kong, currently the largest, has a capacity of more than 21,000 twenty-foot equivalent units (TEU). Ship sizes have increased dramatically in recent decades — back in 2003, OOCL’s newest and largest ship carried barely 8,000 TEUs, which was then the most in the world.

A freighter plane, by comparison, can only carry about 4 TEUs at once.

In addition to these economies of scale, ocean shipping is significantly better for the environment and a great deal more fuel efficient. Each metric ton shipped by cargo ship produces about 15 grams of CO2 — less than 3 percent of the 545 grams per metric ton created with air travel.

But perhaps most importantly, sea freight costs less: about $195 for what would cost $1,000 to ship by air. For global corporations shipping millions of goods around the world, small differences in marginal shipping cost can make a big difference to the bottom line.

For certain goods like smartphones, where the security of shipping is important and marginal costs are easily passed on to the consumer, air travel is the way to go. This is also true for items that need to move quickly, like perishable food, seasonal clothing, or holiday toys.

But most goods going most places are best shipped one way: on a boat.

Los Angeles rents soared as wages stagnated

Rent prices in Los Angeles County increased by nearly 15 percent over a recent period as wages remained unchanged, putting pressure on renters to find other ways to make ends meet or face potential homelessness.

The U.S. Census Bureau pegged the median household income in L.A. County at $56,196 in 2015, the most recent year for which data are available. That was virtually the same as in 2011, when that figure was $56,266 in inflation-adjusted 2015 dollars.

But over the same period, rental prices in the area shot up increasingly quickly. Rental website Zillow, which compiles nationwide home and rental data, found that the median monthly rent increased by 14.5 percent from the end of 2011 to the end of 2015.

That increase didn’t happen steadily. Instead, rents increased significantly in a short period of time. After remaining stable for a few years, the median rent in L.A. County increased rapidly in 2014 and 2015, with a peak year-over-year increase of 8.2 percent from June 2014 to June 2015.

Zillow’s rental index is calculated to reflect changes in the monthly median rent and account for fluctuations in the kinds of homes that are available to rent. This makes it suitable for comparisons, but individual data points are not a reliable indicator of median rent at the time.

It’s not obvious what led to soaring rents, but the trend has not slowed down. Zillow found that in July 2017, the median rent was more than 4 percent higher than a year earlier.

Official income data isn’t available after 2015, which makes it impossible to identify whether rent increases continue to outpace changes in income. Both the state of California and the city of Los Angeles have increased the minimum wage since 2015, to $10 and $12, respectively. Those minimums are set to increase to $15 in the coming years.

California’s statewide minimum wage had increased during the survey period before 2015, but those changes didn’t seem to affect the real dollars Angelenos could afford to spend after accounting for inflation. For example, the state minimum wage reached $9 per hour in July 2014, but the real median household income in L.A. County remained essentially unchanged.

The increase in rental costs might have had major impacts on individual lives. According to municipal government data, the number of homeless people in the Los Angeles area increased by 12 percent from 2013 to 2015, as rent prices increased dramatically.

That city and county data, compiled by the Los Angeles Homeless Services Authority, showed an increase in the total homeless count from 35,524 to 44,359 across the survey area, which did not include the cities of Long Beach or Glendale.

Though census income data isn’t available after 2015, continuing increases in rents and the numbers of homeless people suggest that this trend increased. The municipal governments’ 2017 homeless survey found that 55,188 people lived without homes in the L.A. area, an increase of 24.4 percent from 2015 and 55 percent from 2013.

Median rent has also continued to increase by sizable margins — it’s now 8 percent higher than in 2015 and 24 percent higher than in 2011, when the survey period began.

Growth in short-term rentals shapes the broader real estate market

A former co-founder of a travel management company, Greg Mayben in 2013 co-founded SkyCorporate – a corporate short-term rental company based in Los Angeles Downtown – with his partner Temil Marmon who was an experienced realtor. And he called this company a product of “marriage” between traditional real estate industry and traditional hospitality services.

Six years before founding SkyCorporate, Marmon owned a 22-unit apartment building and signed 12-month leases to tenants in one business district of New Mexico, where few local people tended to live or extend leases. So he started looking for a change. Almost at the same time, Mayben, had spent 25 years in travel services, started looking for a challenge.

“I mean real estate is very fragmented. That reminds me of travel service was three decades ago,” Mayben said. “I saw it’s getting ready for change. I don’t really want to be a part of the old-school business model, which is typically brokerage, whether it’s commercial or residential.”

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