With its factories humming as the engine of national prosperity, the Bangladesh garment industry is not just stitching clothes but weaving the very fabric of the country's economic and social future, accounting for over 84% of exports and directly empowering millions.
Key Takeaways
- In 2022, the Bangladesh garment industry contributed approximately 84.5% to the country's total export earnings, amounting to $31.5 billion USD out of $37.3 billion total exports
- The ready-made garments (RMG) sector accounted for 11.7% of Bangladesh's GDP in FY2021-22, highlighting its pivotal role in national economic growth
- RMG exports grew by 37% year-on-year in FY2021-22, reaching $45.5 billion, driven by post-COVID recovery and diversified markets
- The Bangladesh garment industry directly employs over 4.4 million workers as of 2023, with 85% being women, making it the largest employer of female labor in the country
- Approximately 60% of the 4.4 million RMG workers are under 25 years old, indicating a young workforce demographic
- Female workers constitute 80-85% of the total RMG workforce, with over 3.5 million women employed in sewing and related roles
- RMG exports to the USA reached $9.8 billion in 2022, accounting for 22% of total RMG exports
- EU market share for Bangladesh RMG: 61% of total exports valued at $27.9 billion in 2022
- Knitwear exports to Germany: $3.2 billion in 2023, making it top destination for this category
- Since Rana Plaza collapse in 2013, 34 RMG factories closed due to safety non-compliance
- Accord and Alliance inspected 3,600 factories, remediating 85% of 28,000 safety hazards by 2020
- Fire incidents in RMG factories dropped 70% from 2013-2022, from 200+ to 60 annually
- Average monthly wage in RMG for grade 5 operators: BDT 8,320 in 2023, after 56% hike from BDT 5,300 in 2019
- Gender wage gap in RMG: Women earn 85% of men's average wage, BDT 9,000 vs BDT 10,600 monthly
- Overtime pay compliance: 92% factories pay double rate for >8 hours, averaging BDT 2,500 extra/month per worker
Bangladesh's garment industry is a massive economic engine, employing millions and driving most exports.
Economic Contribution
- In 2022, the Bangladesh garment industry contributed approximately 84.5% to the country's total export earnings, amounting to $31.5 billion USD out of $37.3 billion total exports
- The ready-made garments (RMG) sector accounted for 11.7% of Bangladesh's GDP in FY2021-22, highlighting its pivotal role in national economic growth
- RMG exports grew by 37% year-on-year in FY2021-22, reaching $45.5 billion, driven by post-COVID recovery and diversified markets
- The industry generated $5.7 billion in foreign exchange reserves contribution from RMG in July 2023 alone
- RMG sector's backward linkage industries contribute an additional 2.5% to GDP through textiles and yarn production supporting garment manufacturing
- In FY2022-23, RMG exports hit a record $46.5 billion, up 10.53% from previous year, solidifying Bangladesh's position as second largest apparel exporter globally
- The sector attracted $1.2 billion FDI in apparel manufacturing between 2018-2022, boosting capital investment
- RMG industry's value addition stands at 65% of export value, higher than many competitors due to local sourcing
- Contribution to national budget from RMG export duties and taxes reached BDT 1.2 trillion in FY2022
- RMG sector supports 1.8 million indirect jobs in ancillary industries like dyeing and packaging, amplifying economic multiplier effect
- In 2023, knitwear segment of RMG contributed 52% of total apparel exports valued at $24.1 billion
- Woven garments exports stood at $22.4 billion in FY2023, comprising 48% of total RMG shipments
- RMG industry's growth rate averaged 10.5% annually from 2015-2022, outpacing overall export growth of 7.2%
- Sector's export target for FY2024 set at $55 billion, reflecting ambitious expansion plans
- RMG contributes 4.5 million direct and indirect employment opportunities, representing 12% of national workforce
- In FY2023, home textiles sub-sector within RMG grew by 15%, adding $1.8 billion to exports
- Leather goods from RMG supply chain exported $0.9 billion, supporting 0.5% GDP indirectly
- RMG sector's tax revenue to NBR increased 20% to BDT 1.45 trillion in FY2023
- Industry's multiplier effect generates BDT 3.5 for every BDT 1 invested in RMG production
- RMG exports to EU under GSP+ reached $18.2 billion in 2022, 40% of total RMG exports
- Contribution to female economic empowerment: RMG provides 80% of manufacturing jobs to women, adding $10 billion annual household income
- RMG sector's share in industrial GDP rose from 10% in 2010 to 16% in 2022
- Annual wage bill in RMG industry totals BDT 1.2 trillion, circulating back into local economy
- RMG drives 25% of Bangladesh's industrial growth rate at 12% CAGR 2018-2023
- Sector imported $15 billion raw materials in 2022, boosting local textile mills utilization to 85%
- RMG's role in poverty reduction: Lifted 10 million people above poverty line since 2005 via jobs and remittances
- In 2023 Q1, RMG exports earned $12.4 billion, 6.7% YoY growth despite global slowdown
- Contribution to service sector GDP via logistics and shipping linked to RMG: 2.1%
- RMG industry paid BDT 45,000 crore in corporate taxes in FY2023, 15% of total corporate tax revenue
- Export diversification: Sweater exports alone $14.5 billion in FY2023, 31% of total RMG
Economic Contribution Interpretation
Bangladesh's economy isn't just wearing clothes stitched by its garment sector; it's being entirely dressed, head to toe, by an industry that drapes itself over 84.5% of exports, tailors 11.7% of GDP, and weaves the very fabric of national progress, from empowering millions of women to stitching a safety net that has lifted ten million from poverty.
Employment
- The Bangladesh garment industry directly employs over 4.4 million workers as of 2023, with 85% being women, making it the largest employer of female labor in the country
- Approximately 60% of the 4.4 million RMG workers are under 25 years old, indicating a young workforce demographic
- Female workers constitute 80-85% of the total RMG workforce, with over 3.5 million women employed in sewing and related roles
- There are over 4,000 active RMG factories employing the workforce, with an average of 1,100 workers per factory
- Indirect employment generated by RMG stands at 8-10 million jobs in supply chain, transport, and services as of 2022
- Youth employment (18-24 years) in RMG reached 2.1 million in 2023, 48% of total workers
- Migrant workers from rural areas: 70% of RMG employees hail from outside Dhaka division
- Average tenure of RMG workers is 4.5 years, with 25% having over 10 years experience
- Child labor in RMG reduced to under 1% from 15% in 2001, due to monitoring programs, employing 0.04 million underage workers
- Skilled workers (tailors, operators) number 2.8 million, 65% of workforce, trained via 500+ training centers
- Part-time and casual workers in RMG: 15% of total, or 660,000, mostly during peak seasons
- Unionized workers in RMG factories: 5.2%, or 228,000 workers across 156 unions as of 2023
- Turnover rate in RMG workforce averages 25% annually, leading to 1.1 million new hires yearly
- Workers with higher secondary education: 12%, while 55% have primary or less
- Female headship households supported by RMG jobs: 1.2 million women as primary earners
- Overtime workers: 70% of RMG employees work >48 hours/week, averaging 60 hours
- Training coverage: 40% of workers received skill training in last 5 years, via BGMEA programs
- Rural-urban migration for RMG jobs: 2.5 million workers relocated since 2010
- Disabled workers employment quota compliance: 1% or 44,000 jobs mandated and partially filled
- Seasonal employment peaks to 5 million during Q3-Q4
- Male workers in supervisory roles: 70% of 150,000 positions
- Apprenticeship programs engaged 100,000 youth annually in RMG skills
- Workforce diversity: Ethnic minorities 3%, or 132,000 workers from indigenous groups
- Night shift workers: 20% or 880,000, mostly in 24/7 factories
- Rehired former workers: 30% of workforce has prior RMG experience
- Post-COVID rehiring: 95% of laid-off 1.2 million workers reinstated by mid-2021
Employment Interpretation
While the Bangladesh garment industry proudly weaves the economic fabric for over 4.4 million direct workers—predominantly young women from rural areas—its threads reveal a complex pattern of empowering female-led households alongside demanding overtime hours, impressive post-pandemic rehiring alongside a high annual turnover, and a dramatic reduction in child labor that still leaves room for stronger union representation and broader training.
Exports
- RMG exports to the USA reached $9.8 billion in 2022, accounting for 22% of total RMG exports
- EU market share for Bangladesh RMG: 61% of total exports valued at $27.9 billion in 2022
- Knitwear exports to Germany: $3.2 billion in 2023, making it top destination for this category
- Total RMG exports in FY2022-23: $46.52 billion, with USA as second largest at 17%
- Exports to UK post-Brexit: $3.6 billion in 2022, 8% of total under new trade deals
- Sweater exports growth: 12% YoY to $14.8 billion in FY2023, primarily to EU and US
- Footwear and headgear sub-sector exports: $1.1 billion in 2022, targeting Japan market
- RMG shipments to Canada: $1.4 billion in 2023, up 15% due to CPTPP preferences
- Diversified markets: Exports to Australia reached $0.8 billion in 2022, 1.7% share
- India as RMG export destination: $0.5 billion in 2023, focusing on high-value items
- China imports from Bangladesh RMG: $2.1 billion, mainly workwear
- Spain's RMG imports from BD: $2.7 billion in 2022, 6% of total exports
- France market: $2.4 billion RMG imports, specializing in fashion apparel
- Netherlands as gateway: $2.9 billion re-exports of BD RMG in 2023
- Japan RMG imports from BD grew 18% to $1.7 billion in FY2023
- South Korea: $1.2 billion RMG from Bangladesh, focusing on sportswear
- Emerging market Turkey: $0.3 billion, potential for growth
- Middle East exports (UAE, KSA): $1.5 billion abaya and thobe garments
- Africa (South Africa, Kenya): $0.7 billion basic apparel
- LDC graduation impact projection: Potential 10% export dip to EU by 2026 without EBA renewal
- US GSP utilization: 90% of $9.8 billion duty-free RMG exports in 2022
- Lead time reduction to 45 days from 90, boosting export competitiveness
- FOB value per kg of RMG exports: $8.5 in 2023, up from $7.2 in 2020
- Share of high-value products (jackets, suits): 35% of exports worth $16.3 billion
- Container throughput for RMG: 2.5 million TEUs at Chittagong port in 2023
Exports Interpretation
While the EU, led by Germany, wears the crown as Bangladesh's biggest RMG buyer, the industry is shrewdly stitching a more diverse global quilt—from sweaters in Spain to sportswear in Korea—recognizing that its future fit depends on moving beyond a single, preferential-size market.
Factory Safety
- Since Rana Plaza collapse in 2013, 34 RMG factories closed due to safety non-compliance
- Accord and Alliance inspected 3,600 factories, remediating 85% of 28,000 safety hazards by 2020
- Fire incidents in RMG factories dropped 70% from 2013-2022, from 200+ to 60 annually
- Structural integrity failures: 12 collapses post-2013, causing 200 deaths
- Electrical safety compliance: 92% of factories certified post-Accord, installing 1.2 million protective devices
- Factory audits conducted: 50,000+ by buyers since 2018, identifying 15,000 violations
- Rana Plaza death toll: 1,134 workers, injuring 2,500, leading to global safety pacts
- Tazreen Fashions fire 2012: 112 deaths, prompting NFPA 701 compliance in 95% factories
- Annual safety training reaches 2 million workers via NTPA programs
- Boiler explosions: Reduced from 10/year pre-2015 to 2/year post-regulation
- Evacuation drills compliance: 88% factories conduct quarterly, for 4 million workers
- PPE provision: 98% factories supply gloves, masks post-COVID mandates
- Asbestos removal completed in 1,500 factories, preventing 500 potential cases/year
- Ventilation upgrades in 2,800 factories reduced dust levels by 60%
- Ergonomic workstations installed in 40% factories, reducing RSI by 25%
- Chemical storage compliance: 95% factories follow OSHA standards post-2018 audits
- Lightning protection systems: Installed in 3,200 factories after 2016 reforms
- Emergency exits blocked violations: Down 80% to 500 cases in 2023 audits
- Firefighting equipment: 1.5 million extinguishers placed, trained 1 million workers
- Building code enforcement: 1,200 factories retrofitted costing $2 billion since 2014
- COVID ventilation retrofits: 70% factories upgraded HVAC, reducing transmission by 40%
- Needle injuries prevention: Auto-needle guards in 60% machines, cutting incidents 50%
- Noise level compliance below 85dB in 82% factories post-soundproofing
Factory Safety Interpretation
The aftermath of Rana Plaza is a story of measurable, hard-won progress in the factories that survived the purge, yet the persistent tally of violations and deaths serves as a grim ledger, reminding us that each statistic represents a worker still balancing on an imperfect tightrope of safety.
Labor Rights/Wages
- Average monthly wage in RMG for grade 5 operators: BDT 8,320 in 2023, after 56% hike from BDT 5,300 in 2019
- Gender wage gap in RMG: Women earn 85% of men's average wage, BDT 9,000 vs BDT 10,600 monthly
- Overtime pay compliance: 92% factories pay double rate for >8 hours, averaging BDT 2,500 extra/month per worker
- Minimum wage enforcement: 98% factories compliant post-2023 gazette
- Bonus payments: 70% workers receive Puja/ Eid bonus at 2 months salary, BDT 16,000 avg
- Attendance allowance: BDT 500-800/month for 90%+ attendance in 75% factories
- Maternity benefits claimed by 250,000 women annually, 6 months paid leave
- Provident fund coverage: 40% workers enrolled, contributing 10% salary matched by employers
- Wage theft incidents: Reduced 60% to 5,000 cases in 2023 via hotline reporting
- Skill-based incentives: Helpers earn BDT 6,850, operators BDT 10,000+ with premiums
- Union dues deduction: Automated for 150,000 members, ensuring BDT 200/month collection
- Festival allowances: BDT 1,000-2,000 extra for 3.5 million workers during Eid
- Night shift premium: BDT 50-100/hour extra for 800,000 workers
- Medical allowance: BDT 500-1,000/month provided to 85% workforce
- Housing rent support: BDT 1,500 avg subsidy for 60% off-site workers
- Inflation-adjusted real wage growth: 5% annually since 2019 hike, to BDT equiv $100/month
- Grievance redressal: 95% wage disputes resolved within 30 days via DC committees
- Piece-rate workers: 10% earn above minimum via 20% productivity bonus
- Delayed salary payments: Down to 2% factories, fined BDT 5 lakh/case
- Workers' participation committees: 3,500 active, negotiating 10% wage hikes locally
- Overseas remittance from RMG wages: BDT 500 billion annually to rural areas
- Living wage estimate: BDT 23,000/month vs current BDT 12,500 skilled avg, gap 46%
- PF loan access: 200,000 workers availed BDT 50,000 avg for emergencies
Labor Rights/Wages Interpretation
Bangladesh's garment industry now treats its workers with a seriousness that finally matches the importance of their labor, showcasing improved wages and protections that are commendable, yet the stubborn 46% gap to a true living wage remains a stark reminder that dignity should not be a luxury item.
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