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The term connotes a factory in which the workers are abused physically, mentally, or sexually, subjected to long hours, harsh or unsafe conditions, and the like.
Some sweatshops are owned by multinational corporations, but others are locally-owned companies that produce products on behalf of foreign corporations. Corporations usually work through a process of subcontracting, meaning they don't own the sweatshops themselves but employ smaller organizations who own the sweatshops and produce the required goods.
Some companies have been accused of using children in their subcontracting sweatshops. Some countries where sweatshops are found forbid the practice of trade unionization, making it difficult for employees to protest their treatment.
Sweatshops are actually not a new phenomenon. The United States and Europe in the 19th and early 20th centuries saw sweatshops that offered low skilled workers and new immigrants the opportunity to work.
Labor Unions, such as the AFL-CIO, have helped support the anti-sweatshop movement both out of a genuine concern for the welfare of people in the developing world and out of self-interest. Since products produced in sweatshops are cheaper relative to products produced by American or European workers, unions worry about the cheaper products that potentially put their members out of work.
Sweatshop labour is a focus of the anti-globalization movement, which has accused many companies (such as the Walt Disney Company, The Gap, and Nike) of exploiting sweatshops. The movement charges that the process of neoliberal globalization has made it difficult to stem corporate abuses of sweatshop workers. Furthermore, they argue that lower-wage production in other countries is responsible for a loss of jobs in first-world countries
Those who defend the practice of moving production to low-wage facilities overseas point to a lower standard of living as an explanation for the low wages, and argue that their operations benefit the community by providing needed jobs. However, some companies have bowed to public pressure to reduce their dependence on sweatshop labour and have reduced or ended this practice in their operations.
In fact, recent studies demonstrate the power sweatshops to raise wage levels and improve working conditions in the developing world. Since the choice of an unskilled worker in the developing world is sometimes begging (or worse), sweatshops often provide the only other opportunity to help them feed their families.
Some companies publicize the fact that their products are not made with sweatshop labour; a number of organizations publish lists of companies that pay their workers a living wage.
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