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Forced labour is big business: states and corporations are doing little to stop it

The recent flurry of government, corporate, and NGO initiatives to eradicate slavery does little to tackle underlying causes. Until this changes, severe exploitation will thrive in the global economy.

Forced labour is often described as an isolated crime perpetuated by ‘unscrupulous’ employers. But it is more systemic than many governments, businesses, and anti-slavery organisations want to believe.

While unethical labour recruiters and bad apple employers certainly do not help, the much bigger, structural problem is the unfair global economic system in which they operate. To genuinely understand why forced labor is thriving today, we need to understand how the system works, and the role that businesses and states play in fostering an economic and political context in which individuals can exploit with impunity.

We can begin to understand forced labour’s role in this system by thinking in terms of supply and demand. In the age of neoliberal globalisation, certain types of businesses ‘need’ forced labour to safeguard their profits or their market share. For this reason, as Andrew Crane explains, some businesses ‘attempt to underprice a key resource (labor) through illegitimate means.’ At the same time, large swathes of the poor ‘need’ awful jobs to safeguard their survival, and they frequently find their exit from those jobs blocked (creating a common scenario of forced labour). The former expresses the demand, while the latter are the supply.

Precise business dynamics vary by industry. In sugar, for instance, cane producers use bonded labour or excessive overtime to maintain the crop’s low market price. While in electronics manufacturing—where studies show high proportions of workers are subject to some form of forced labour—factories turn to debt-bonded migrant workers hired through  intermediaries to meet customer orders.

Yet similarities exist across different commodities and supply chains. Evidence from a range of contexts suggests that lead firms across a broad range of industries tacitly rely on forced labour to make their products, despite supplier codes of conduct or CSR claims to the contrary.

Paying suppliers fiercely low prices, demanding goods too quickly or on short notice, and chronically delaying payments all foster reliance on exploited labour, including unprotected agency workers, as well as forced, bonded, or child labour. This is particularly acute at lower tiers of the supply chain and along the labour supply chain, where enforcement of labor standards is especially minimal.

In short, while global supply chains produce unprecedented profits—increasingly concentrated at the very top—they do so at a serious cost to workers. This is why Benjamin Selwyn claims that supply chains should be viewed “not as benign spheres of opportunity, but as tools for increasing the exploitation of labour.”

Why are so many people ‘available’ to be exploited in this fashion? A crucial part of the answer lies in the neoliberal policies that have been widely demonstrated to foster inequality and insecurity, and to entrench poverty and exclusion. As welfare states have been rolled back and the guarantee of regular employment or social protection has been diminished, more and more of the world’s people are forced to become what Nicola Phillips refers to as ‘the working poor’. Survival has been ‘marketised’, and when survival is only possible through money and markets, people with few options have to accept whatever the market has to offer.

In contrast to the dominant market thinking which attributes this to abstract economic forces, we hold it to be a fundamentally political state of affairs. As the actors ultimately responsible for setting the rules of the game, governments and big businesses are not merely guilty of complicity in the existence of forced labour, but of actively creating the very conditions that make it possible.

As Rachel Wilshaw and her OXFAM colleagues make clear, when inequality rises, so too does the likelihood of state capture by elite business interests. The more wealth concentrates at the very top, the more those at the very top are able to influence states to promote policies that protect profits over people. Thus we now witness social spending slashed to pay for corporate tax breaks. We have a proliferation of ‘light-touch’ labour regulations that, among other things, replace ‘expensive’ labour inspection with the ‘cheaper’ option of letting businesses take charge of protecting workers’ rights. And we have the creation of bonded labour pools in the form of temporary foreign work programmes, such as the ones documented by Susan Ferguson and David McNally. 

We must assess existing anti-slavery or anti-forced labour strategies within this context rather than outside of it. The governance initiatives currently in place—ranging from private mechanisms like auditing to public initiatives like transparency legislation—simply fail to confront the underlying causes. Indeed, a common feature across the full spectrum of recent initiatives championed by states, corporations, and NGOs is that they leave the business models that give rise to forced labour fully intact. At the same time, they do very little to challenge the inequality and poverty that guarantees a supply of workers needy enough to accept dreadful working conditions.

Thus, while many corporations’ supply chain initiatives focus on identifying and preventing forced labour through ‘ethical’ compliance auditing, none that we have seen attempt to reduce suppliers’ reliance on forced labour by paying them more, or by putting a stop to their use of labour market intermediaries. So long as price, contract length, and the dynamics of labour subcontracting remain off the table for change, such initiatives will do little to tackle the relations of power and production that give rise to forced labour in the first place.

The same is true for government efforts.  Many states have recently passed national action plans and legislation to eradicate forced labor. Although these initiatives seek to harmonise government agencies to better identify and prosecute incidents of forced labour, as well as to raise the criminal justice consequences for individual perpetrators, they have done little to alter the broader political economic context in which such crimes emerge and thrive. None do anything whatsoever to address chronic economic insecurity. Is it any wonder, then, that Jens Lerche laments that ‘there has been little or no progress in eradicating forced labour worldwide’?

It’s time to stop tinkering around the edges and to move towards more systemic solutions to these problems. These need to be centred around redistribution of value, both within and along the supply chain, and within society more broadly. Neil Howard’s article puts forth a powerful case for the consideration of Unconditional Basic Income as a structural strategy to address and prevent severe labour exploitation.  Doubtless, there are many other bold and creative solutions.  The point is that we need to start working towards these, and stop reinforcing the status quo. 

About the authors

Genevieve LeBaron is Senior Lecturer in the Department of Politics at the University of Sheffield, Chair of the Yale University Working Group on Modern Slavery, and a UK ESRC Future Research Leaders Fellow. You can follow her on twitter @glebaron

Neil Howard is an academic activist based at the Institute of Development Policy and Management at the University of Antwerp. His research focuses on unfree labour, and on the workings of the policy establishment as it seeks to respond. Follow him on twitter @NeilPHoward.

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