Sub-contracting, the seamy side of the clothing industry

Abstract

This paper is the third in a series on the clothing industry, . forming part of the research project 'A Local Division of Production: Technological Change and the Productive lnterlinkages in Australian Manufacturing'. The findings and arguments presented in this paper are based on a variety of data including face to face interviews with industry, government and union representatives. The garment industry is characterised by labour intensity, the predominance of small firms and the pervasive practice of subco ntracting out the assembly stage of production . The results of the current study indicate that within certain sub-sectors of the clothing industry, these features are a consequence of the need for fl exibility and that in particular, sub-contracting, a critical link in the clothing chain of production, appears to be the only economically viable strategy for many firms in the current economic climate. However this strategy succeeds at the expense of a severely exploited hidden workforce of outworkers. The future of the Australian clothing industry has come under close scrutiny recently through Government measures designed to open up the se ctor to international competition. Both the Government and the union movement argue that the only survival path open to local clothing firms is to adopt the latest technology, improve quality, exploit niche markets and target export potentials. This paper suggests however, that although many of Australia's largest clothing companies are adopting this approach, many other companies cannot afford to and are likely to devise instead, an alternative survival strategy which incorporates the traditional practice of outwork. Unless more effort is made to understand the structure and the dynamics of change within this industry, the future scenario is likely to be quite different from that which the Government believes it is promoting and may well conflict with the grand vi sion of award restructuring being fostered by the Government and the unions