Bangladesh’s apparel and textile industry is undergoing a structural shift that is increasingly visible on factory floors but insufficiently reflected in headline export figures. While garment exports have expanded rapidly over the past decade, employment generation has moved in the opposite direction is mirroring a broader global trend where automation is redefining how textiles are produced and how many workers are required to do so.

Globally, the textile and apparel industry is valued at nearly $2 trillion and employs tens of millions of workers, yet its production model is shifting from labour-intensive to capital-intensive systems. Automation, robotics, and digital manufacturing technologies are no longer confined to advanced economies; they are now spreading rapidly across major apparel hubs in Asia, including Bangladesh, Vietnam, China, and Indonesia.

Global automation drive and the shrinking labour equation

Across the global textile value chain, manufacturers are investing heavily in automated cutting, knitting, dyeing, finishing, and increasingly sewing technologies to improve speed, accuracy, and cost efficiency. Industry analysts note that labour productivity in apparel manufacturing has risen sharply over the past decade, even as workforce expansion has slowed or stagnated.

Jason Prescott, Chief Executive Officer, International Textile Manufacturers Federation, notes that this shift is structural rather than cyclical.
“Globally, textile manufacturing is moving toward capital-intensive models. Automation enhances productivity and sustainability compliance, but it inevitably reduces demand for repetitive manual labour. Countries that fail to upgrade workforce skills will face growing employment stress,” he says.

Studies assessing automation risk in garment manufacturing across Southeast Asia suggest that between two-thirds and nearly 90% of apparel jobs involve tasks that are technically automatable over time. While adoption speeds vary by country, the direction of travel is uniform—machines are steadily replacing low-skill, repetitive labour.

Thomas Rabe, Senior Industry Analyst, Global Manufacturing, McKinsey & Company, observes that apparel automation is advancing faster than many policymakers anticipated.
“Advanced cutting, sewing and finishing technologies are shortening lead times dramatically, but they also signal the end of large-scale labour absorption in traditional garment hubs,” he says.

Bangladesh: productivity gains without proportional jobs

Bangladesh’s experience reflects this global reality in a particularly concentrated form. Over the past decade, the country’s apparel exports rose from $12.5 billion to around $40 billion, cementing its position as the world’s second-largest garment exporter. Yet manufacturing employment declined sharply during the same period, with around 1.4 million jobs lost between 2013 and 2023, despite robust output growth.

The impact is most visible in factories that have adopted automated machinery in knitting, sweater production, denim processing, and garment finishing. Factory-level evidence shows that a single automated machine can now deliver four to five times higher output than manual alternatives, while requiring far fewer workers.

Rezwan Selim, Vice President, BGMEA, and Managing Director, Softtex Sweater, explains how automation has altered production economics. He says
“Automation is no longer a choice for export-oriented apparel manufacturers. Global buyers demand speed, consistency, and traceability. One skilled operator can now run multiple automated machines, which raises productivity four to five times—but it also fundamentally changes the employment structure.” 

In denim manufacturing, similar dynamics are playing out. Automated pocket-attaching, laser finishing, and digital washing technologies have compressed workforce requirements per production line.

Shams Mahmud, Managing Director, Shasha Denims, says the numbers speak for themselves.
“Five years ago, a denim production line needed close to 90 workers. Today, the same volume can be produced with nearly half that number. From a business standpoint, automation improves cost efficiency and quality, but it clearly reduces the sector’s capacity to absorb low-skill labour,” he says.

Cost pressures are reinforcing automation

Rising wages, expanding compliance obligations, and operational risks have accelerated the move toward automation. Since the last wage revision, labour costs in Bangladesh’s garment sector have risen substantially, while additional statutory benefits such as severance provisions, maternity leave, provident funds, and bonuses have increased fixed employment costs.

Manufacturers argue that automation offers predictability in an environment where labour-related disruptions can halt production.

A senior South Asia supply chain executive at a global apparel brand, speaking on condition of anonymity, notes that automation is largely a supplier response to buyer expectations.“Buyers are not pushing suppliers to reduce jobs, but they are pushing for speed, accuracy, and compliance. Automation is the supplier's response to that pressure. Employment outcomes are a secondary effect often unplanned,” the executive says.

Automation is not the only driver

However, industry leaders caution that automation alone does not explain job losses across the textile value chain. Structural constraints are particularly energy shortages and financial stress, have also reduced capacity utilisation in upstream textile mills.

Md. Khorshed Alam, Director, BTMA, and Managing Director, Little Group, points to deeper operational bottlenecks. He says,
“Job losses in textiles are not driven by automation alone. Energy shortages, financial stress, and unfair competition through bonded warehouse misuse are forcing mills to scale down. Even fully automated machines remain idle when the gas supply is unreliable.” 

These constraints, combined with shrinking margins, have slowed new investment and limited the sector’s ability to create alternative employment avenues for displaced workers.

Skills gap widens as technology advances

Automation has also transformed the nature of factory jobs. While low-skill helper and assistant roles are disappearing, demand is rising for machine operators, technicians, and maintenance specialists. Yet the transition has been uneven, leaving many workers unable to re-enter the modernised production system.

M A Jabbar, Managing Director, DBL Group, says skills development has become a survival imperative, and added,
“Automation increases output per worker, but it also demands higher skills. That is why re-skilling and multi-skilling are now critical. Without structured training, displaced workers will struggle to re-enter modern factories.” 

Narrow industrial base amplifies the impact

Economists argue that Bangladesh’s heavy dependence on a single export sector has magnified the employment consequences of automation. With ready-made garments accounting for over one-third of manufacturing output and 85% of exports, productivity gains translate directly into labour displacement at the macro level.

Professor Mustafizur Rahman, Distinguished Fellow, Centre for Policy Dialogue (CPD), explains the structural imbalance. He says,
Bangladesh is facing jobless growth because productivity gains are not being matched by horizontal industrial expansion. Automation reduces labour per factory, but the economy failed to create enough new factories or new sectors to compensate.”

Mohammad Abdur Razzaque, Chairman, Research and Policy Integration for Development (RAPID), adds that concentration risk is central to the problem and says, “When a single sector dominates manufacturing output, automation becomes a systemic employment issue. In Bangladesh, where RMG drives over one-third of manufacturing output, technological upgrading has an economy-wide labour impact.” 

Global comparison: Vietnam’s diversification buffer

Vietnam offers a contrasting case. While automation is equally widespread there, large-scale foreign direct investment has helped diversify manufacturing into electronics, machinery, footwear, and furniture is creating alternative employment channels.

William Son, Vice President, Vietnam Textile and Apparel Association, says diversification has softened the labour shock.
“Vietnam’s experience shows that automation does not eliminate jobs, it changes them. The challenge is scale. If industrial diversification and foreign investment move fast enough, job losses in one segment can be absorbed by new manufacturing sectors,” he says.

Bangladesh, by contrast, has struggled to attract comparable levels of export-oriented FDI, limiting its ability to offset job losses within garments.

The policy crossroads

Automation in textiles is inevitable. Global evidence shows that resisting technological adoption only erodes competitiveness. Yet unmanaged automation risks entrenching jobless growth in labour-dependent economies.

Mark Anner, Professor of Labour and Employment Relations, Penn State University, warns of distributional consequences. He says,
“Automation in apparel manufacturing disproportionately affects low-wage, low-skill workers. Without deliberate policy intervention, productivity gains tend to concentrate profits while weakening labour’s bargaining power.” 

For Bangladesh, the challenge is no longer whether machines will replace workers but whether the country can create new industries, new skills, and new investment pathways quickly enough to employ those displaced by automation.

The future of the textile sector will be shaped not just by smarter factories, but by smarter industrial policy.