The Economics of Human Trafficking: Is It Truly Profitable?

 

              The use of forced labor is extremely prevalent in some countries around the world. In such areas, efforts to abolish the use of forced labor face undue resistance because of a belief that the business of human trafficking is simply too profitable. There are many reasons someone would hold such a belief. A victim of trafficking is often forced to labor without the expectation of being paid, a setup that results in almost total profit for the employer. The only costs that need be paid in such a situation are the basic costs of keeping the laborer alive. The profitability of the forced labor trade is also supported by the sheer availability of victims. The cost of buying forced laborers is at the lowest level its ever been. In the American South, the price of an average field hand was between $1000 and $1500, which would be equivalent to about $40,000 in today’s money. Compare this to the fact that the cost to enslave a family of bonded laborers in India can run from as little as $10 to over $100 (depending on how much debt is owed). Additionally, there are more people being forced into labor today than any other time in the history of the world, which means there is no shortage in supply for those who intend to rely on trafficking to further their goals.

              In spite of these reasonings, I argue that that the use of forced labor is ultimately inimical to the economy both locally and on a global scale. While it may be true that forced labor allows an employer to operate a business at a much lower cost, that boon comes with severe drawbacks for local economies. Human trafficking operations mostly take place at the lower end of the production ladder, in industries such as manufacturing and raw material processing. Forced labor jobs in these industries pose intense competition for a worker who isn't being trafficked and is simply trying to make a living. Forced labor also takes potential consumers out of the economy, hurting everyone in the process. Trafficking, by its very nature, causes those who are trafficked to resist by never working as well as they can. There are numerous accounts of former victims of trafficking going on to become very successful. Much can be said on the amount of potential wasted by keeping people in bondage. Indeed, the institution of modern slavery seems to only deaden economic growth by taking jobs, consumers, and possible producers out of the economy.