353 factories closed in a year, 119 thousand unemployed - Deep signal in the industrial sector

A total of 353 factories have closed in the country's main industrial areas of Savar, Gazipur, Chittagong, Narayanganj and Narsingdi in the last one year. This has made 119 thousand 842 workers unemployed. Many of them have tried to find new jobs but failed and have finally returned to their villages. A large part of the closed establishments are in the ready-made garments, knitwear and textile sectors. According to sources from the Department of Factory Inspection and Industrial Police, the owners are being forced to stop production due to various crises.

According to the industrial owners, high interest rates and strict interest policies on bank loans, LC complications in raw material imports, continuous gas crisis and periodic gas price increases, lack of uninterrupted power supply, worker dissatisfaction and continuous wage increases are increasing production costs. Due to these reasons, it has become difficult to maintain competitiveness in the international market. As a result, many companies have been forced to decide to ‘shutdown’.

A large portion of the workers who lost their jobs have stayed in the cities in search of new jobs by spending their savings, but many have returned to their villages unable to meet the rent and daily necessities. This has led to the discontinuation of education for many children, reduced spending on healthcare, and cases of falling into debt traps.

The most affected sectors are the ready-made garments, knitwear, and textiles. The crisis in these sectors is evident due to LC complications in the import of raw materials including yarn, chemicals, and dyes, uncertainty of gas and electricity, increased machine downtime, and a decline in orders. According to experts, to save the industrial sector, it is necessary to immediately refinance working capital, facilitate LC, ensure uninterrupted gas and electricity supply in industrial areas, develop technology, and take short-term income support and skill development programs for workers who have lost their jobs.

Economists say that if this trend continues, unemployment in urban areas will increase, consumer spending will decrease, bank defaults may increase, and export earnings will decrease. Therefore, without rapid and coordinated action, this crisis is likely to be prolonged.