Media Update: United Nations Pakistan, 18 July 2026

ILO

PRESS RELEASE

Better Work Pakistan report finds stronger factory performance and growing buyer confidence in Pakistan's garment sector

First synthesis report shows participating factories are more resilient and better positioned for international markets, while buyers signal greater sourcing potential as compliance and transparency improve.

ISLAMABAD, Pakistan (ILO News) - Better Work Pakistan (BWP), which now engages 135 garment and textile factories across Pakistan, today released its first synthesis report, finding that participating factories demonstrate stronger business performance, greater operational resilience and improved workplace outcomes than comparable non-participating factories. The report also points to growing confidence among international buyers, with one-third saying they are likely to increase sourcing from Pakistan over the next two to three years if progress continues on labour compliance, product quality and supply chain traceability.

The report provides the first comprehensive factory-level evidence on compliance performance, business competitiveness and buyer expectations in Pakistan's garment and textile sector. Drawing on factory assessments, buyer surveys and industry research conducted during Better Work Pakistan's pilot phase from 2022 to 2025, it highlights how investments in better working conditions can also strengthen factory performance and competitiveness.

Among participating factories, more than two-thirds reported improvements in worker productivity after joining Better Work, while around two-thirds also reported improvements in worker morale, occupational safety and health, and worker-management relations. Approximately 60 per cent reported moderate to large improvements in market access, business risk mitigation and reduced duplication of buyer audits, suggesting that stronger labour compliance can also support business performance.

The report also highlights the resilience of Pakistan's export-oriented garment sector despite continued economic pressures. While 88 per cent of surveyed factories reported rising operating costs in 2025, 42 per cent maintained stable export values and a further 39 per cent reported export growth compared with the previous year. More than half also reported receiving requests from international buyers to reduce prices despite increasing production costs, underscoring the pressures facing manufacturers.

At the same time, the report finds generally low levels of non-compliance on wages and worker employment contracts among factories assessed in 2025. It identifies occupational safety and health systems, emergency preparedness, and ensuring workers understand their employment terms and conditions as key priorities for continued improvement.

A survey of international buyers sourcing from Pakistan indicates cautious optimism about the country's future sourcing potential. Thirty-three per cent of buyers said they were likely to increase sourcing from Pakistan over the next two to three years, while another 25 per cent expected to maintain current sourcing levels. Nearly half (49 per cent) said they would be more likely to expand sourcing if factories continued improving labour compliance, product quality consistency and supply chain traceability, reflecting the growing importance of sustainability and transparency in global supply chains.

"This report marks an important milestone for Better Work Pakistan and for the sector as a whole. For the first time, we have a rigorous, factory-level evidence base that speaks directly to what buyers, government and industry need to know. Factories that invest in compliance are more competitive, more resilient, and better positioned in global markets. We are proud to present this evidence and remain committed to taking this programme to the next level with our partners," said Ivo Spauwen, Programme Manager of Better Work Pakistan.

Launched in 2022, Better Work Pakistan has expanded from 78 participating factories in 2023 to 135 factories in 2025, reaching more than 300,000 workers through factory assessments, advisory services and workplace training. Building on the pilot phase, the programme is pursuing a second phase that would expand engagement to additional garment and textile enterprises across Punjab and Sindh, as well as into other export sectors.

About Better Work Pakistan

Better Work Pakistan is a joint programme of the International Labour Organization (ILO) and the International Finance Corporation (IFC). It works with factories, buyers and government to improve working conditions and business competitiveness in Pakistan's garment and textile sector.

Link to the report: Better Work Pakistan Synthesis Report: An Industry and Compliance Review (2022-2025) - Better Work

For further information please contact:

Muhammad Numan

Communication Officer

Email: [email protected]

Mobile: +92 303 5000041