Extreme weather and climate events are expected to significantly impact the global fashion industry, with four leading garment-producing countries likely to forgo $65 billion in earnings over the next seven years, according to a study conducted by Cornell University and investment manager Schroders.
Producers in Cambodia, Bangladesh, Pakistan, and Vietnam, which account for nearly 18% of global apparel exports, are at a notably higher risk as they will likely see a 22% drop in export-related earnings by the decade’s end. More than 10.8 million workers are today employed by producers in the region, nearly a million of whom are at risk of losing their jobs due to lower productivity.
Many of these producers, based in cities such as Dhaka, Hanoi, Ho Chi Minh City, Karachi, Lahore, and Phnom Penh, are at significant risk as they confront extreme heat, humidity, and flooding.
Just last year, Pakistan saw torrential downpours, which put more than a third of the country underwater — the worst flooding it has ever seen. The extreme weather wiped out nearly 45% of the cotton fields in the country, contributing to a global shortage of raw cotton.
Pakistan and Bangladesh, in particular, have been struggling with extreme heat events, with the average temperature surpassing 104°F for several days during spring and summer.
Cornell and Schroders’ analysis shows that businesses can expect to forgo $65 billion in “business as usual” scenarios if no measures are taken to address flooding and high heat. The estimate is based on the assumption that heat stress will result in a 1.5% decline in productivity for every 1°C (33°F) increase in the “wet-bulb globe temperature,” which is an indicator of heat stress.
That said, if factories were to proactively take steps, such as ensuring workers get enough rest and are well hydrated, they could mitigate some of the projected losses. Relocating factories to nearby but low-risk locations and offering workers paid leaves and the right to suspend work could also help, the study suggests.
“Climate ‘loss and damage’ for manufacturers and workers are treated by brands as externalities — someone else’s problem,” Jason Judd, executive director at Cornell’s Global Labor Institute, said in a statement.
“Workers need these investments now because extreme heat standards and flood protections are non-existent.”
While totally moving suppliers out of impacted geographic locations may seem like a viable alternate, it would actually be counterproductive as brands would “struggle to build the large-scale capacity they benefit from in South and Southeast Asia.”