The layoffs are part of a wider downturn in an industry that accounts for around 80 per cent of Bangladesh’s export earnings.
About 400 of the roughly 4,000 apparel factories in the country have shut over the past two years, eliminating tens of thousands of jobs, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
Some of them had to shut down because they could not survive with exports declining in the “highly competitive” global market, BGMEA president Mahmudul Hasan Babu told AFP.
TRADE DEALS
The closures have fuelled concern over the future of a sector that employs more than 4.5 million people, most of them women.
While US tariffs are similar for apparel exporters across Asia, analysts say Bangladesh faces a greater challenge in Europe, its largest market, where India and Vietnam have gained ground through free-trade agreements.
The pressure could intensify as Bangladesh is set to lose the duty-free preferential market access it enjoys in Europe and other countries because its status as a least-developed country is scheduled to expire in 2029.
“If Bangladesh fails to strike free-trade agreements after the end of the preferential trade regime, the country may risk losing competitiveness,” said Dhaka University professor Selim Raihan.
European Union apparel imports fell during the first five months of the year, with those from Bangladesh recording the sharpest decline among major suppliers, Eurostat data shows.
Experts point to weak consumer demand linked to conflicts in Ukraine and the Middle East, but also blame structural weaknesses in the South Asian nation of 170 million people.
The industry remains focused on low-margin products such as T-shirts and jeans, while rivals have moved into higher-value segments made with synthetic fibre.
Bangladesh, which earned about US$39 billion from garment exports in 2025, relies heavily on imported cotton and other fibres, raising production costs.