128 RMG factories opened, 113 closed in the last 15 months


A total of 113 garment factories ceased operations between January 2024 and March 2025, forcing over 96,000 workers out of jobs, BGMEA figures show. In contrast, 128 new factories were established and received membership from the trade body during the same period, creating jobs for 74,081 workers.
While the number of newly opened factories slightly outpaces closures, over 22,000 more jobs were lost than created. During the August 2024 to March 2025 window, 69 factories shut down, affecting 76,504 workers—highlighting an accelerating trend of closures.
Industry insiders cited multiple reasons behind the closures, including shrinking global orders, price pressures from international buyers, rising production costs, delayed payments and political changes.
Due to political changes in August 2024, some notable factories closed due to their owners' close ties with the ousted government, which had helped them receive abnormal loans from the banks.
Most of the closed factories were in the small and medium category, which lost their competitiveness long ago. Many small and medium-sized units have struggled to comply with evolving safety and sustainability standards, forcing them out of the market.
The 128 new factories established in the period indicate a shift towards consolidation and modernisation. Many of these are believed to be replacements or expansions by existing players investing in state-of-the-art machinery, green building certifications, and digital production systems. These upgraded units are also creating new employment opportunities—albeit fewer than the losses from closures, as automation reduces labour dependency.
The ongoing transformation is seen as a reflection of the industry's transition from volume to value, industry insiders said.
BGMEA officials have also acknowledged the need to support workers affected by factory closures. Discussions are ongoing about launching a formal job-matching platform and upskilling programs in collaboration with development partners.
Speaking with TBS, former BGMEA President Faruque Hassan said factory closures and openings are a normal part of the industry's activities.
"Factories without compliance upgrades or sustainable production practices are struggling to survive," he said, adding, "At the same time, new investments are focusing on modern, energy-efficient and automated plants that meet buyers' latest due diligence criteria."
"But the transition must be inclusive, ensuring retraining and reemployment pathways for the workers forced out of jobs," he noted.
"We are moving from being a low-cost manufacturing hub to a value-added supplier," the BGMEA official said.
With rising global attention on ethical sourcing and sustainable production, the dual trend of closures and factory upgrades is expected to continue in the near future. Whether job creation can keep pace with job losses will depend on how quickly new investments show up—and how effectively the industry supports its displaced workforce during this transformation.
Faruque Hassan noted that the recent closures occurred due to a number of factors, including delays in payments from buyers, bankruptcy filings, and management failures. This time, political changes have also played a role, with several large groups – such as Beximco and NASA – affected.
He expressed hope that the newly opened factories will create more employment than those that closed, once they begin operating at full capacity.
Faruque Hassan also mentioned that the industry is facing several challenges, including the potential imposition of additional tariffs by the US government, Bangladesh's graduation from LDC status, rising utility costs, and a lack of leadership.
He urged the government to take proactive steps to address these challenges.
With the upcoming BGMEA election approaching, he said he hopes the elected leadership will be able to negotiate with the government for policy support to help the industry navigate these pressing issues.
Meanwhile, Nazma Akter, labour leader and the president of the Bangladesh Sommilito Garments Sramik Federation (SGSF), said more than 100,000 workers lost their jobs due to factory closures.
"Around 75,000 of them have managed to find new employment, but a significant number still remain jobless," she said. "We urge the government to take urgent steps to create employment opportunities for the remaining workers."
Former BGMEA Director Mohiuddin Rubel said that many of the newly opened factory units have already recruited skilled workers from the closed factories.
He noted that the pattern of industrialisation in the RMG sector is changing, with the number of small factories declining while large-scale factories are on the rise.
"The reasons behind factory closures are varied—ranging from utility issues and absentee ownership leading to weak management, to a lack of orders," he said.