Cambodian Journalists Alliance Association

Debt, food insecurity weighing heavy on unemployed garment workers

Yin Yoy, who lost her garment factory job last year, said the biggest concern for her family was food insecurity. Khy Sovuthy
Yin Yoy, who lost her garment factory job last year, said the biggest concern for her family was food insecurity. Khy Sovuthy
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Samraong Tong district, Kampong Speu province — Yin Yoy was busy doing quality control checks on garments manufactured at New Best Global factory in Kampong Speu province last year. The laborious work, which earned her $200 a month, came to an abrupt halt last February after the factory closed down.

At the time, the global supply chain was thrown out of kilter by stagnant production in China, as the manufacturing powerhouse’s COVID-19 case count rose dramatically. A number of factories in Cambodia were left with little or no raw supplies, most of which are imported from China, causing work stoppages and production suspensions.

Sitting at her home in the province’s Samraong Tong district, Yoy said she thought she would find a job soon after her factory closed. But 12 months on, she is still unemployed.

While Yoy is trained to do quality checks on finished products, she never learned to cut, sew or stitch garment – which are a majority of jobs on the factory floor. Being unable to read or write disqualifies her from any administrative jobs.

“I do not know what jobs I can do because I am illiterate and I do not know how to sew,” said Yoy, with a tone of despair.

The COVID-19 pandemic has affected the tourism and garment export sectors hardest. The World Bank estimates the Cambodian economy will contract 2 percent in 2020, but rebound to 4 percent growth in 2021, which is low compared to the consistent 7 percent average growth registered in the last decade.

While the tourism industry came to a grinding halt because international travel was suspended, the garment sector saw dozens of factory suspensions and closures, leaving thousands of workers unemployed and with no other feasible job opportunities.

Government statistics show that 129 factories have closed down in the last year, affecting some 70,000 workers.

Unable to find work, Yoy is now a domestic help at a relative’s home, earning around $50 a month. She sent her eldest child, who is 13-years-old, to work at a salon in Preah Sihanouk province. But, the family is earning far less than Yoy’s $200 wage at the factory.

The family is most concerned about going hungry. Immediately after she lost her job she moved in with her relative who helped buy milk for her toddler. She then sent the toddler and another child to live with their grandparents.

“My mother worked as a dishwasher to get some money to buy food for my children and my father worked as a security guard for a factory,” said Yoy.

“If I stayed at home with them, I will not have food to eat.”

Frayed Sector

The garment sector is one of the largest employers in the Cambodian economy. Estimates suggest at least 700,000 workers work in the export-focused sector, with some rights groups put this number at more than a million workers.

Major exports, including garments, dropped by 2.5 percent in 2020, according to a World Bank report from December, which would have been far worse had not exports to the U.S. seen an increase during the same period.

As of July 2020, the Garment Manufacturers Association in Cambodia said 400 factories had suspended operations and laid off 150,000 workers.

Labor Ministry Spokesperson Heng Sour declined to give details about the health of the sector when contacted last week.

He only said that 129 factories had officially closed at the end of 2020, leaving 71,202 workers jobless. He said 112 new factories opened during that time, offsetting some of the job losses with 23,000 new positions.

Mann Seng Hak, vice president of the Free Trade Union of Workers of the Kingdom of Cambodia, said factory closures were severely affecting workers. They were finding it hard to provide for their families, he said, and more worryingly unable to pay back mounting debts.

“We feel regret for workers who lost their jobs during COVID-19 and they are faced with loan payments,” said Seng Hak.

He said the government should find a solution for unemployed workers who have debt and push microfinance institutions to delay payments.

Prum Tola, who lost her job at a Kampong Speu garment factory, said she was finding hard to make repayments on her $20,000 loan. Khy Sovuthy
Prum Tola, who lost her job at a Kampong Speu garment factory, said she was finding hard to make repayments on her $20,000 loan. Khy Sovuthy

Prum Tola, who also lost her job at New Best Global Factory, could use help with her loan. The 38-year-old Kampong Speu resident took a $20,000 loan from Sathapana Bank to build her house.

It was hard to make the $600 monthly payment with her old job and near impossible to repay now. The mother of two children uses some income from her husband’s grocery store, which was near the now-shuttered factory, to make the payments, but had to recently sell some of the family jewelry.

“The most difficult part is the bank payments because I do not have enough money to pay the bank,” she said. “I borrowed the money from the bank because I didn’t think the factory would close.”

“Now, I need to sell a necklace and bracelet that belonged to me and my children to make the bank payment,” Tola added.

The garment worker said the family was finding it hard to ensure they had sufficient food to eat and was having to stretch a few groceries over multiple meals.

The biggest hurdle to finding a new job, she said, was participating in protests against the owner of New Best Global Factory asking for unpaid wages. But word spread around and other factories decided to not hire anyone who was part of the protests.

“When I heard that was happening, I did not apply to other factories in the area because they think that I am a representative of the protesters,” Tola said. “It is discrimination for an employer to not employ workers who have protested.”

A report released last June by rights NGOs Licadho and Central and a pro-worker labor union showed that nearly all 162 workers surveyed had some form of debt or microloans and that their lives were worse at that time than before they took the loan.”

Worryingly, three-quarters of those with microloans were eating less food to make monthly payments, according to the report.

Pav Sina, president of the Collective Union of Movement of Workers, said a small percentage of unemployed workers were getting absorbed back into the sector, with most workers taking up construction jobs or starting small businesses.

“I think that if workers are skilled, they will apply to different factories but some workers who did not have the required skills, they will go to do other work,” Sina said.

He expected the sector to rebound as soon as a majority of people are vaccinated against COVID-19.

Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia, also said increased vaccination across the world would help the sector return to normalcy.

“I think that processing of garment factories in 2021 will better than 2020,” said Loo.

Labored resolve

Workers across the district are still hopeful that they will find garment jobs soon. Tola was optimistic despite admitting that the number of applications for each job far outnumbered open positions.

“If there is a new factory open near my house, I will go to work back,” said Tola.

Yoy was far less hopeful and worried her family would have to continue doing small jobs to make ends meet, but was aware that would not be the case always.

“Sometimes when my mother does not go to work as a dishwasher, my children do not have food to eat because we have no money to buy food,” Yoy said.

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