The Effect Of Sweatshops On The Economy

Good Essays
Sweatshops are a large part of today's economic system and have been for a long time in the past. They are viewed by many companies as key to production as they create cheap labor, and by many individuals as cruel for their long hours and minimal pay. Even though there are many connotations directed to this form of mass production, sweatshops have effects on the economy both locally, and nationally. These sweatshops bring economic growth to small communities with employment that adds money to the economy, while also promoting economic growth nationally by stimulating an entire GDP and overall economic growth of a Nation. Local communities receive stimulated economy with higher income rates for employees and nationally production is changed…show more content…
These Bangladeshi employees “at the much-demonized Bangladeshi “sweatshops” average more than $2 a day” (Powell 6). This is $2 a day that is only put into the economy and pockets of individuals by these sweatshops, this is very good for the economy, economic growth, future potential of the country, and a better future for the employee. The daily average in Bangladesh outside of sweatshops is $1.25 daily, this $1.25 is also not handed out to nearly as many people as sweatshops employ. Sweatshops do an incredible job of creating an income for such a large mass of people that otherwise would not have an income. A continuity for most sweatshop conditions and wages “[sweatshops] commonly pay their workers more on average in comparison to the prevailing market wage for similar workers employed elsewhere in the economy” (Miller 6). Locally, sweatshops provide a stable income for the masses and more “adequate shares of the growing income of the country distributed to the citizens” (Miller 12). Giving individuals and income essentially gives them a say in the economy, production of…show more content…
The phenomenon of the sweatshop tends to create capital in the national economy of the country the sweatshop is located or centralized in, “ sweatshop phenomenon ands to the beneficial consequences of sweatshops for both their employees and the broader economies in which they functioned” (Zwolinski 1). The primary beneficial consequences being increased income and employment rate and production quantity The national consumer demand has a huge effect on sweatshop labor “In other words, if economic agents demand less of a good the more that good costs, then any policies that raise the cost of sweatshop labor will result unless labor being demanded, i.e. unemployment” (Zwolinski 2). Sweatshops like all business feels the changing demand for product. Since their large labor numbers they must pay close attention to demand, in order to not create excess of anything. This makes sweatshops a fantastic production model to keep demand met and excess or wasteful production low. Sweatshops really do greatly add to the overall GDP of a country as regulating Sweatshop labor prices negatively affects the GDP of said country “To the extent that sweatshop regulations do, in fact, hinder economic growth” (Powell 3). When sweatshops
Get Access