Dhaka – Over 100,000 workers lost jobs in 2025 alone as factory closures, rising costs, weak exports and mounting bank defaults threaten the country’s industrial backbone
Bangladesh’s garment industry is facing a deepening crisis, with roughly 400 garment units closing over the past three years, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
A December 2025 survey by the Asia Floor Wage Alliance recorded 258 factory closures in a single year, with more than 100,000 workers losing employment. Among the hardest hit was Beximco Group, which shut 16 units and laid off around 40,000 workers by March 2025.
The factory closures are creating a wider economic impact, affecting workers, suppliers, banks and local communities. The crisis comes as Bangladesh’s garment sector faces weakening demand, rising production costs, energy shortages and high borrowing costs.
Despite generating US$39.35 billion in FY2024–25, more than 81% of Bangladesh’s total exports, the sector recorded a 2.82% year-on-year decline in earnings during July–April of FY2025–26.
The situation is further complicated by Bangladesh’s scheduled graduation from Least Developed Country status in November 2026, which could gradually reduce preferential market access and increase export costs.
With factory closures accelerating and the banking sector burdened by record levels of defaulted loans, industry experts warn that Bangladesh urgently needs a coordinated industrial recovery strategy to revive viable factories, protect workers and preserve its export base.
The factories may be closing, but the economic consequences are spreading far beyond their gates.
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