"Our industry is unable to continue operations given the current situation," the Garment Manufacturers Association in Cambodia (Gmac) wrote in an open letter Sunday.
Claiming the factories had been hit by illegal strikes and violent actions, the group said owners had been left with ``no other option but to close.''
Kong Athit, vice-president of the Coalition of Cambodia Apparel Workers Democratic Union _ one of the nation's biggest unions _ said an estimated 80% of factories had been shut down from either work stoppage or voluntarily closed by the owners.
"At least 400,000 now are not going to work out of 600,000 workers," he told dpa. "Of the people who stop working, some are just going home and some are coming to strike."
At least 30,000 workers joined marches and road blocks Monday as the government and unions continued emergency negotiations. Gmac boycotted the talks, in a move criticised by the government, according to local media.
Workers began striking last week after the government announced that the minimum wage would be raised from US$80 (2,560 baht) to $95 a month starting in April. The announcement fell far below the $160 called for by unions.
The garment industry represents Cambodia's biggest export sector and surpassed $5 billion in 2013.
In the Gmac letter, the association warns that late penalties and missed shipping schedules will result in further losses and that the unions "will have to bear full responsibilities for the loss of wages, loss of jobs and the loss of investment in Cambodia."