The impending rise in the national minimum wage set for April 1 is raising concerns for Nagsun Apparel (Fiji) Pte Ltd, a garment manufacturer that has already faced significant difficulties, including the closure of its Ba branch last year. Shabana Azmin, the company’s production and sales manager, noted that the previous minimum wage increase in August intensified their challenges, with the company struggling under the weight of rising production costs and decreasing orders.
Azmin highlighted that the current state of the garment manufacturing sector poses risks for many businesses, including Nagsun Apparel, as they find it increasingly hard to attract new clients. The upcoming review of wages adds another layer of complexity, as increased costs may jeopardize existing contracts with clients who are now considering cheaper alternatives from overseas.
“It is crucial that decisions reflect facts that can foster job creation in our country,” Azmin emphasized, pointing out the mounting pressures faced by manufacturers amid growing operational expenses alongside government-imposed wage hikes.
To stay operational, Nagsun Apparel is attempting to manage payroll levels by reducing work hours, even as a decline in orders is forcing them into unavoidable cutbacks. Azmin noted that they are working to mitigate these hour reductions as much as possible.
With the new minimum wage, Nagsun Apparel anticipates that passing on the additional costs to clients may lead to further losses, as feedback from clients suggests reluctance to accept these price increases, prompting many manufacturers to rethink their business strategies or consider relocating.
This situation reflects broader trends within the Fijian textile and garment industry, which has already experienced significant workforce reductions and business closures due to rising costs and external pressures. The ongoing discussions regarding wage increases and potential legislative reforms are vital for the sector’s future sustainability.
While wage reforms aim to enhance living standards, it is critically important to strike a balance between fair worker compensation and the operational viability of businesses. The industry is urging comprehensive discussions to create an environment where both employee welfare and business sustainability can thrive.
This scenario underscores the pressing need for strategic investment and reform in Fiji’s manufacturing sector to effectively address the challenges ahead. By embracing innovative solutions and thorough planning, there is hope to revitalize the industry and bolster its resilience for the future.
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