The labor pressures of the United States towards Mexico are not new, nor is the electoral fallacy that claims that Mexico is the vacuum cleaner of jobs for the United States, whose original author was the Texas magnate H. Ross Perot, in 1996, during the discussion of NAFTA or TLCAN. It is true that Mexico became attractive for investment under various premises, two of which are uncomfortable: very low minimum wages (today Mexico pays almost 800 percent less than the minimum wage in the United States) and an inactive unionism (white or protection) that gave, until before the labor reform of 2019, an advantage that some described as dumping labor.
However, the manufacturing jobs that have been lost in the United States have not gone to Mexico, as the Republican candidate and now his running mate convinced his potential voters in 2016 and wants them to believe; in fact, as shown in chart one, in 25 years of NAFTA, the United States lost almost five million net jobs, while Mexico barely created two million (also net).
One might wonder what has happened to manufacturing jobs in both countries after NAFTA and the ‘brand new’ USMCA? Chart number two shows that after NAFTA, manufacturing job creation has grown in both countries, but at different rates: the United States has managed to create an average of 80,000 new manufacturing jobs per year during the years of the USMCA, while Mexico has created an average of 300,000 jobs per year. Overall, and from 1994 (with NAFTA) to 2023 (with the USMCA), Mexico generates more manufacturing jobs than the United States, so the ‘job thief’ hypothesis seems attractive and almost convincing. However, blaming Mexico for the loss of jobs or the low generation of them is, to say the least, simplistic; The loss of jobs in American factories must be sought in technological, generational migration and cultural issues, such as the serious limitation in the capacity of traditional American industries to create economic growth and job opportunities for people, by conceiving technological change as the only possible source of wealth creation.
A final reflection concerns whether the working class in the three countries (Mexico, the United States and Canada) has benefited from the North American trade agreements. The data seem to show that there have been no real benefits for workers, since in all three countries they have suffered relative impoverishment, as shown in figure three. Unfortunately, in Mexico, the symptoms of this impoverishment have been more severe, turning organized crime into an attractive employer in an informal, precarious and violent market.
