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The athletic apparel industry in which Nike is involved is a major money maker in the United States, but the fact that none of the factories are located in North America has brought some heat to the company. Nike controls more than 40 percent of the U.S. Market for sports related goods, but doesn’t have a single sneaker factory in this country (Miller 1). Nike continues to make millions of dollars yet exploits workers overseas by paying them very little, while requiring long hours without overtime pay in factories that are not up to “American” standard. Nike subcontractors employ nearly 500,000 workers in plants in Indonesia, China and Vietnam (Saporito 1). The exploitation of workers in Third World counties, where the majority of Nike’s labor is done sparks a controversial issue. People question why is it that Nike continues these practices.
According to “Just do it, Nike,” Nike seems especially fond of doing business in undemocratic countries like China and Indonesia, where the military can be relied upon to “crack heads” if workers get out of line (Miller 2). The military monitoring has been a large controversy due to the fact that these are often Chinese working against other Chinese workers, or Vietnamese against their own people also. For Nike there are two benefits: it it’s a cheap way to monitor in an overseas factory and it creates a sheaper labor workforce. In turn making the labor cheaper for Nike. This makes it possible for Nike workers from the states to work on other things and only tour the factories when nessecary. While still assuming a stable workforce without good pay. The critics of Nikes labor practices have taken tours and witnessed the mistreatment firsthand. Time magazine reported saying,” The plants were found to be modern and clean, well lighted and ventilated and paying a decent wage by local standards—although by no means are they trouble free. Make no mistake: these are factories not amusement parks, and even in developing Asia, where jobs are scarce and getting scarcer, this is not the job of choice.” (Saporito 1)
The wages that the workers overseas are paid is nothing when compared to how much we pay for a pair of shoes or the profit that CEO Phil Knight is making off his sportswear giant he once operated out of the back of his car as a college student.
“A big issue that surrounds sweatshops is wage. The minimum wage often does not reflect the cost of living.” (Hepner Online)
Is the wage fair? There are many people who feel the wage is fair and the cost of living is taken into account when the wage is looked at, but studies show otherwise in many factories. Just recently, CNN reported a raise to entry level workers in Indonesia, Nike officials said “the increase will raise the minimum monthly compensation package—which includes bonuses, housing, healthcare, transportation and meal allowances to approximately
$37.14 a month.”(Nike Establishes Labor” Online) To many people living in the U.S., that package may sound good however the compensation package doesn’t do away with the long hours, the poor conditions or the low rate of pay. Many of these workers are young children working to help support their families. The benefits do not make up for the low pay rates that keep them in the work force. The pay is only enough to get by where these children want to be saving in order to leave the factories and return home.
In “Taking a Look inside Nike’s Factories”, part of Bill Saporito’s, “Can Nike Get Unstuck?” this is what was found. “Americans pay $100 for a pair of shoes that a worker gets less than $3 a day to make. They pay Michael Jordan $40 million to endorse them. Can’t they find more money to pay the workers? The short answer is no, because corporations pay the going rate for labor whereever they are.” (Saporito 1) If this statement is true Nike pays the wage for the country the factory is in, then what is the controversy about?
Much of it stems from the overtime that these workers are forced to work without over time compensation. Here in the United States there are regulations placed on businesses that require then to compensate their workers with a higher