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Multinationals outsource their manufacturing 
to developing countries with devastating 
consequences for workers there.
Over the last few decades, many multinational 
companies have followed what is known as the 
‘Nike Model’ of manufacture. Basically, in order 
to save on labor costs, firms have shut down 
their factories in Western countries and 
outsourced their manufacture to the less-
developed world where labor is much cheaper.
The workers who make the products that were 
previously produced in Western factories are 
contractors rather than employees; hence, the 
multinationals have no responsibility for them.
Most of the outsourced manufacture takes place 
in ‘Export Processing Zones.’ These are 
specifically designated areas within less-
developed countries where income and export 
taxes are suspended to encourage investment. 
However, to make the zones desirable, many 
domestic governments go even further by 
eliminating minimum wages, labor laws and 
union rights.
The employees who work in these zones, the 
majority of whom are young migrant women, find 
themselves in a kind of legal limbo. They are 
neither the responsibility of the corporations 
whose factories they work in, nor are they 
protected by standard domestic law. To 
minimize labor costs and maximize productivity, 
they must endure awful working conditions and 
accept ever smaller wages. Women in Mexico, 
for example, must prove they are menstruating 
and therefore not pregnant, because pregnancy 
will result in them having to take time off. Those 
who are found to be carrying a child or who 
refuse to be checked are sacked. Wages are 
always incredibly low, in some cases a mere 
$0.13 an hour.
Far from being beneficial to less developed 
nations, Export Processing Zones in fact 
facilitate the exploitation of workers.
Multinationals outsource their manufacturing to 
developing 
countries 
with 
devastating 
consequences for workers there.