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Helping Refugees & The Sustainability of Human Capital in Fashion

by Guest Blogger September 20, 2016

Helping Refugees & The Sustainability of Human Capital in Fashion

Sustainability is a critical issue in the fashion industry that needs to be understood as more than a buzzword.  Sustainability is the foundation of not only the survival of the industry, but the prosperity and development of hard working people everywhere. 

Conversations surrounding sustainability quite often focus on physical capital.  In the fashion industry they often focus on sustainable fabrics, like organic cotton, or sustainable manufacturing practices, like reducing the prevalence of child labor by using machines instead.  On the other hand, a greatly overlooked aspect of sustainability is the idea of sustaining human capital.

Human capital, or skilled men and women who work passionately at their craft, is the foundation of economic growth. Nobel Prize Winner Robert Solow discovered in the 1950s that (1) the two main factors that drive economic growth in a country are the amount of human capital versus the amount of physical capital and that (2) human capital makes up approximately two thirds of the contribution to productivity and prosperity, while physical capital only made up a third. [1] A simple illustration is the following: imagine that you are a baker with a shop that sells cookies.  In order to make more cookies, you need to buy more ovens. If you go from one oven to two ovens, you might expect to make twice as many cookies.  But if you buy 10 more ovens, you will not expect to make 10 times as many cookies because the ovens are useless without a human to operate and make problem solving decisions for them.  Better technology is always important, but ultimately machines are second to skilled-humans in importance to the supply chain. This relates to what development economists call the “Productivity Paradox”, and is one of the greater unanswered questions. [2]  In summary, the paradox relates to how investing in a new technology helps workers to produce a little bit more but never as much more as expected. One of the prevailing theories on why this is true relates to the idea that machines are helpful, but still the returns from a new technology diminish over time without a skilled worker to operate the machine.

There is an enormous waste of potential talent in America, especially with the opportunities to employ refugee women. [3]  While traveling through over 40 countries I saw that the textiles industry provided more jobs and training to folks in developing countries than almost any other industry. Much like my own parents, who immigrated to the United States from Iran, many of these individuals have emigrated or sought refugee status in the United States.  Immigrants are the foundation of America, and I saw the big picture of these talented tailors and artists being ignored for employment as being wasteful and unsustainable for a thriving America.

Thus, sustainability is the foundation of prosperity, and unsustainable growth can actually do long-term damage to an economy. [4]  By nurturing and sustaining human capital, we create several positive externalities.  First, by enabling people to practice the creative craft they love, we are helping to employ and empower them economically, emotionally, and spiritually as they settle into their new homes and workforce. Second, many of these jobs and skills are performed by women who otherwise would not be able to practice and grow their skill set. Development economics teaches us that the development trajectory and prosperity in a country can largely be measured by how empowered the female population is. [5]  By empowering women economically, we are driving an often overlooked part of the economic supply chain, and raising the aggregate quality of life for both women and children.

In the Spring of 2014, I founded Dress Abstract as a doctoral researcher in Design and Sustainable Economics. During my studies, it became clear that there was an important opportunity to help sustainability in the clothing industry. At Dress Abstract, we take a socially conscious look at the intersection of sustainability, human rights, and fashion. We are proud to sustain and employ the refugees and displaced people who help hand-make our clothing and wearable art in the USA. Visit us at www.DressAbstract.com.

Nima Veiseh is the founder of Dress Abstract, and an academic researcher in design and sustainability.  He has trained at the Arts League of New York on 57th Street, The George Washington University, Georgetown University, Columbia University and the Massachusetts Institute of Technology.

[1] Solow, Robert M. "A contribution to the theory of economic growth." The quarterly journal of economics (1956): 65-94.

[2] David P.A., "The Dynamo and the Computer: A Historical Perspective on the Modern Productivity Paradox", American Economic Review Papers and Proceedings, 1990, 355–61.

[3] Capps et al. “The Integration Outcomes of U.S. Refugees: Successes and Challenges”, Jun 2015. http://www.migrationpolicy.org/research/integration-outcomes-us-refugees-successes-and-challenges.

[4] BBC Report, January 20, 2014. http://www.bbc.com/news/business-25808279.

[5] OECD Report, http://www.oecd.org/dac/gender-development/43041409.pdf.

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