How to end modern-day slavery in the age of deglobalization

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Enrique Restoy, Executive Director Programmes and Policy, Hope for Justice, Rachel Hartley, Consultancy Director, Slave-Free Alliance, Adam Hewitt, Head of Digital and Communications, Hope for Justice

• Trafficking in persons is a lucrative business that has grown partly because of globalization and cross-border trade in goods and services.
• As deglobalization occurs, the cross-border nature of trafficking in persons subsides but risks of modern slavery increase as unintended consequences.
• Proactive and collaborative policies between governments, businesses and civil society can help stem modern slavery.

Trafficking of persons into modern slavery is one of the world’s most lucrative illicit businesses, generating a record $240 billion in yearly estimated profits.

Human traffickers have also taken full advantage of globalization as millions of men, women and children are forced to make the goods and components that keep global supply chains stocked, while migrants and refugees are tricked into labour or sexual exploitation across borders. The worldwide mobility of capital and technology facilitates the cleansing of the profits of this despicable business, and traffickers use the internet to stimulate both the supply of and demand for modern slavery.

The latest global estimates show that, for the first time in history, almost 50 million people are trapped in slavery. These figures represent a staggering 20% increase in five years. Nearly half of this number are people subjected to forced labour by private enterprises in international operations and supply chains. But how does this increase reconcile with a period of economic deglobalization and reduced commercial and economic integration?

The rise of deglobalization

In recent years, we have seen a contraction in global trade and movement of people due to the COVID-19 pandemic, alongside the proliferation of policies favouring local production, consumption and trade, and migration restrictions.

Deglobalization is also occurring in private sector companies’ sourcing strategies. Our experience engaging with dozens of global corporations is that the pandemic exposed the fragility of global supply chains. Businesses are diversifying to reduce single points of failure and sourcing from new places to reduce reliance on long shipping and logistics routes. For example, apparel businesses in the United States and the United Kingdom are attempting to reduce dependence on sourcing from China by increasingly sourcing in local markets (as well as from South America and Europe or North Africa, respectively).

In principle, deglobalization could reduce international flows of goods and people and the risk of cross-border trafficking of people into modern slavery. However, over five years, there has been a 1.35 million increase in the number of people trapped in forced labour in the private sector.

Advancing modern-day slavery

Risks of modern slavery in global supply chains have not decreased during deglobalization; instead, they have evolved and adapted to thrive:

• Our experiences show that as private sector companies diversify and consolidate supply chains, exit policies and procedures fail to mitigate unintended consequences on their suppliers’ businesses and workforces. At worst, the socio-economic shock can ripple across whole communities; a lack of decent work increases poverty, increasing the risk of modern slavery. Responsible exit policies – e.g. adopted by Fair Wear, Action Living Wages, ASOS and Pentland Brands – have become more common in the apparel industry. Still, all industries must adopt a similar approach to mitigate this risk.
• The trend towards local sourcing gives a bigger role to small and medium-sized enterprises (SMEs). But SMEs are rarely included within modern slavery legislation – they are not covered by the UK Modern Slavery Act 2015, for example, nor the upcoming Canadian Fighting Against Forced Labour and Child Labour in Supply Chains Act – excluding them from reporting mandates. SMEs may be less inclined to identify and address risks without this legislative pressure.

Migration and slavery

Four key elements explain these observations:

• The world economy and trade remain greatly integrated.
• Deglobalization has not reduced irregular migration. The connection between irregular migration and human trafficking is real. Traffickers often work with (or are themselves) people smugglers and take advantage of the irregular situation of migrants to exploit them further, playing on their victims’ fears of deportation.
• Migration control policies are leaving gaps in workforces, increasing the risk of exploitation domestically to meet the demand. For example, in the UK, the risk to British citizens and residents is increasing and we are seeing other methods being used by traffickers, including the exploitation of student visas.
• Most critically, the vulnerability of people to modern slavery has increased. Inequality within countries has grown since COVID-19 and the global economic crisis pushing millions below the poverty line. Forced displacement of people has climbed to over 110 million due to armed conflict, social and political instability, climate change and other natural disasters. Poverty and displacement are critical contributors to vulnerability to trafficking into modern slavery.

Policies of protection

Preventing people from being trapped in modern slavery requires bold policies and unprecedented collaboration between governments, businesses and civil society, even during economic and political deglobalization. We recommend that:

• Governments introduce policies that de-link immigration control from anti-trafficking measures and instead focus on responses that reduce vulnerabilities to modern slavery and foster the power of people with lived experience of slavery. They should introduce stricter legal accountability frameworks to compel private companies to invest in identifying and mitigating forced labour risks in their supply chains.
• Governments, companies and civil society should elevate their political and strategic commitment to ending modern slavery by backing a new high-level Global Commission on Modern Slavery and Human Trafficking. A multilateral body overseeing efforts to combat trafficking in persons has the potential to foster stronger global governance, accountability and financial mechanisms to support the international response.
• Businesses must take meaningful collective action to understand and identify modern slavery risks in their operations and supply chains. They must then take proportionate action to prevent and mitigate those risks and remedy any issues. Industries must collaborate to improve standards sector-wide.
• The public, private and third sectors should invest substantially in technology for collaboration to foster intelligence and data exchange. They must overcome their reticence to exchange sensitive information by using existing technology solutions that can do this without compromising the privacy and identity rights of people affected by human trafficking.