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" Exploring the Effect of Paying Living Wages in Apparel Sourcing from Sub-Saharan Africa and Asia "
Zeng, Lian
Godfrey, A
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Latin Dissertation
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| Language of Document
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English
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| Record Number
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1105056
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| Doc. No
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TLpq2292190128
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| Main Entry
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Godfrey, A
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Zeng, Lian
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| Title & Author
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Exploring the Effect of Paying Living Wages in Apparel Sourcing from Sub-Saharan Africa and Asia\ Zeng, LianGodfrey, A
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| College
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North Carolina State University
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| Date
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2019
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| student score
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2019
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| Degree
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M.Sc.
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| Page No
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191
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| Abstract
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The textile and apparel industry, as an important part of trade in the world, is a labor-intensive and cost-sensitive industry. Many companies are engaged in global sourcing for lower cost and better quality because of increasing competition. Low labor costs are an important driver for companies to source from other countries, especially from developing countries. Garment workers in many parts of the world earn much less than the national average. More and more organizations and institutions promote and support payment of living wages instead of minimum wages. A landed cost analysis of the T-shirt and denim jeans supply chains was performed for five Asian countries and five SSA countries. The landed costs of each country were compared using each type of labor wage. The analysis method used is this paper is Adikorely’s (2016) adaption of Fiallos’ (2009) landed cost model. It used factors, such as fabric cost, labor wages, energy, water, transportation costs, and import duty charges, to assess the effects of a living wage on the landed cost of different supply chains. The country rankings were compared across the different labor wages. Except Ghana, SSA countries ranked best for T-shirts and denim jeans because they had the lowest landed cost when compared with Asian countries for all of the different labor wages. The results also demonstrated that when comparing the living wages published by three sources, the Asia Floor wages are generally highest followed by the WageIndicator.org wages and then the GLWC wages. For sourcing T-shirts and denim jeans, apparel manufacturing in SSA countries was found to be cost competitive when compared to Asian countries from which the U.S. often sources apparel, except Ghana because of its high labor wage. The labor costs in most of Sub-Saharan African countries are always lower than Asian countries. China has the highest labor wage and landed cost compared to other countries when paying different living wages. The cost competitiveness of Ethiopia decreased significantly when using WageIndicator living wages.
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Textile research
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