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NewForesight is happy to share the second in a series of three sectorial reports. This report studies workers’ wages and working conditions in the banana sector. The banana sector supports the livelihoods of millions of workers globally.
The report delves into the importance to workers’ wages & conditions from different production models, production for domestic consumption vs export, product differentiation and more factors concerning the global production and supply chains of the banana sector.
The report studies global market dynamics and how global supply chains impact wages and working conditions in the banana sector. Based upon a root cause analysis, NewForesight presents a range of recommendations and inspirational best practices to drive better wage and working conditions outcomes.
The report seeks to contribute to a better understanding of the state of work in the selected sectors and supply chains, identifying opportunities for social dialogue and stakeholder actions that offer a way forward for progress on decent work.
The reports are undertaken as part of an ILO project on Indicators and methodologies for wage setting supported by the Ministry of Foreign Affairs of the Netherlands – and Rainforest Alliance is one of its partners. The aim of the project is to support the capacity of government and social partners to negotiate and set adequate wages and to enable committed industry-wide initiatives or enterprises to leverage better wages for the lowest-paid workers.
The report finds that wages are, on average, in line with minimum wage levels but that in some cases, because of a lack of social dialogue, prevailing wages are set at relatively low levels compared to the basic needs of workers and their families. Many workers in the sector are remunerated via piece-rate pay and although wages paid by employers are largely in line with minimum wages, many workers have to work excessive working hours.
From a market perspective, one of the challenges is that there is an unsustainable business case due to intensifying price competition and low retail prices. This dynamic has fueled the hiring of temporary and informal workers at production level to cut costs, including non-wage contributions. However, evidence suggests that there is a positive relationship between producer profitability and working conditions of workers in the banana sector, suggesting that supply chains – under the right conditions – play an important role in the improvement of workers’ wages and working conditions.
The report calls for concerted, supply chain-wide action on critical root causes in the sector. Without tackling the root causes, sector-wide systemic change will not prevail. The report highlights necessary actions for all stakeholders to take: private sector, governments, social partners, institutional actors, and civil society.
We encourage all stakeholders to read the report and contribute to improvement of wages and working conditions. The report was developed by Daniel Pedersen, Joost Backer, Jennifer Morton, and Joost Gorter.
Click here to read the report.
For any enquiries on the report, please reach out to Daniel Pedersen at firstname.lastname@example.org.