The effect of Italy’s garment shadow economy
Unregulated home workshops support the country’s luxury items
BARI PROVINCE, ITALY— In a second-floor apartment in the southern Italian town of Santeramo in Colle, a middle-aged woman sat in a black-padded chair this summer, hard at work at her kitchen table. She carefully stitched a sophisticated wool coat, the sort of style that will sell for 800 to 2,000 euros ($1,200 to $3,000 Canadian) when it arrives in stores this month as part of the fall and winter collection of MaxMara, the Italian luxury fashion brand. But the woman, who asked not to be named for fear that she could lose her livelihood, receives just1euro from the factory that employs her for each meter of fabric she completes.
“It takes me about one hour to sew one meter, so about four to five hours to complete an entire coat,” said the woman, who works without a contract, or insurance, and is paid in cash on a monthly basis. “I try to do two coats per day.”
The unregulated work she completes in her apartment is outsourced to her from a local factory that also manufactures outerwear for some of the bestknown names in the luxury business, including Louis Vuitton and Fendi. The most she has ever earned, she said, was 24 euros ($37) for an entire coat. Home work — working from home or a small workshop as opposed to in a factory — is a cornerstone of the fast-fashion supply chain. It is particularly prevalent in countries such as India, Bangladesh, Vietnam and China, where millions of low-paid and predominantly female home workers are some of the most unprotected in the industry, because of their irregular employment status, isolation and lack of legal recourse.
That similar conditions exist in Italy, however, and facilitate the production of some of the most expensive wardrobe items money can buy, may shock those who see the “Made in Italy” label as a byword for sophisticated craftsmanship.
Increased pressure from globalization and growing competition at all levels of the market mean that the assumption implicit in the luxury promise — that part of the value of such a good is that it is made in the best conditions, by highly skilled workers, who are paid fairly — is at times put under threat.
Although they are not exposed to what most people would consider sweatshop conditions, the home workers are allotted what might seem close to sweatshop wages. Italy does not have a national minimum wage, but roughly 5 to 7 euros per hour ($7.60 to $10.60) is considered an appropriate standard by many unions and consulting firms. In extremely rare cases, a highly skilled worker can earn as much as 8 to10 euros an hour ($12-$15). But the home workers earn significantly less, regardless of whether they are involved in leatherwork, embroidery or another artisanal task.
In Ginosa, another town in Puglia, Maria Colamita, 53, said that a decade ago, when her two children were younger, she had worked from home on wedding dresses produced by local factories, embroidering gowns with pearl paillettes and appliqués for 1.50 to 2 euros per hour.
Each gown took10 to 50 hours to complete, and Colamita said she worked 16 to 18 hours a day; she was paid only when a garment was complete.
“I would only take breaks to take care of my children and my family members — that was it,” she said, adding that she currently works as a cleaner and earns 7 euros per hour. “Now my children have grown up, I can take on a job where I can earn a real wage.”
Both women said they knew at least 15 other seamstresses in their area who produced luxury fashion garments on a piecerate basis for local factories from their homes. All live in Puglia, the rural heel of Italy’s boot that combines whitewashed fishing villages and crystal clear waters beloved by tourists with one of the country’s biggest manufacturing hubs.
Few were willing to risk their livelihoods to tell their tales, because for them the flexibility and opportunity to care for their families while working was worth the meagre pay and lack of protections.
“I know I am not paid what I deserve, but salaries are very low here in Puglia, and ultimately I love what I do,” said another seamstress, from the attic workshop in her apartment. “I have done it all my life and couldn’t do anything else.”
Although she had a factory job that paid her 5 euros per hour, she worked an additional three hours per day off the books from home, largely on highquality sample garments for Italian designers at roughly 50 euros apiece.
“We all accept that this is how it is,” the woman said from her sewing machine, surrounded by cloth rolls and tape measures.
The centuries-old foundations of the “Made in Italy” leg- end have shaken in recent years under the weight of bureaucracy, rising costs and soaring unemployment.
Businesses in the north, where there are generally more job opportunities and higher wages, have suffered less than those in the south, which were hit hard by the boom in cheap foreign labour that lured many companies into moving production operations abroad.
Few sectors are as reliant on the country’s manufacturing cachet as the luxury trade, long a linchpin of Italy’s economic growth. It is responsible for 5 per cent of Italian gross domestic product, and an estimated 500,000 people were employed directly and indirectly by the luxury goods sector in Italy in 2017, according to data from a report from the University of Bocconi and Altagamma, an Italian luxury trade organization. Those numbers have been bolstered by the rosy fortunes of the global luxury market, expected by Bain & Co. to grow by 6 to 8 per cent, or 276 billion to 281billion euros, in 2018 — driven in part by the appetite for “Made in Italy” goods from established and emerging markets.
But the alleged efforts by some luxury brands and lead suppliers to lower costs without undermining quality have taken a toll on those on those operating at the very bottom of the industry. Just how many are affected is difficult to quantify.
According to data from the Italian National Institute of Statistics, 3.7 million workers across all sectors worked without contracts in Italy in 2015. More recently, in 2017, Istat counted 7,216 home workers, 3,647 in the manufacturing sector, operating with regular con- tracts.
However, there is no official data on those operating with irregular contracts, and no one has attempted to quantify the group for decades. In 1973, economist Sebastiano Brusco estimated that Italy had 1 million contracted home workers in apparel production, with a roughly equal figure working without contracts. Few comprehensive efforts have been made to examine the numbers since.
Tania Toffanin, the author of Fabbriche Invisibili, a book on the history of home working in Italy, estimated that there are 2,000 to 4,000 irregular home workers in apparel production.
“The deeper down we go in the supply chain, the greater the abuse,” said Deborah Lucchetti, of Abiti Puliti, the Italian arm of Clean Clothes Campaign, an anti-sweatshop advocacy group. According to Lucchetti, the fragmented structure of the global manufacturing sector, made up of thousands of medium to small, often family-owned, businesses, is a key reason that practices like unregulated home working can remain prevalent even in a First World nation like Italy.
Plenty of Puglian factory managers stressed they adhered to union regulations, treated workers fairly and paid them a living wage. Many factory owners added that almost all luxury names — like Gucci, owned by Kering, for example, or Louis Vuitton, owned by LVMH Moët Hennessy Louis Vuitton — regularly sent staff to check on working conditions and quality standards. When contacted, LVMH declined to comment for this story. A spokesperson for MaxMara emailed the following statement: “MaxMara considers an ethical supply chain a key component of the company’s core values reflected in our business practice.”
“The deeper down we go in the supply chain, the greater the abuse.”
DEBORAH LUCCHETTI CLEAN CLOTHES CAMPAIGN