Immigration and Free Trade With Mexico

Protecting American Workers Against Double Jeopardy

By David Simcox on December 1, 1991


Free trade is likely to increase immigration from Mexico to the United States before ultimately slowing it.

Rapid population growth, unemployment or underemployment of half the labor force, and vast ethnic and kinship links to the United States have given Mexican migration a stubborn momentum. Increased prosperity from free trade will give many would-be migrants the means to resettle in the U.S. Competition from U.S. and Canadian producers will displace Mexican workers in small farms, state-owned enterprises, and other less competitive industries, forcing some to migrate.

The non-economic incentives and expectations driving migration will also remain strong. Mexicans may see free trade as making the border a mere formality or as conferring an entitlement to live in the United States. North of the border, free trade may well further the U.S. government's traditional complacency about border controls. Industrial job growth in Mexico will tend to absorb the best workers and lower the average skill levels of those left who will enter the migrant pool.

Over the long-term, however, a successful free trade agreement could reduce immigration by improving Mexicans' political freedom and quality of life, diminishing the prospects of mass asylum movements from Mexico, creating a better climate for effective family planning, and luring marginal, immigration-magnet industries from the U.S. to Mexico.

In the United States, less skilled American workers and settled aliens in some industries and regions will be particularly vulnerable to job displacement and other disruptions from free trade. Particularly at risk will be workers in perishable crop agriculture, border retail trade, construction, apparel, and light manufacturing such as furniture, auto parts and glass. Continued heavy immigration of Mexican and other foreign workers into those industries and communities will further impede the adjustment of resident workers by competing for jobs and consuming public resources needed for retraining and job search.

To ease the adjustment of displaced workers, the u.s. must make Mexico's cooperation in restraining immigration a condition for free trade. Mexico's cooperation should include:

  • enforcement of its own laws against clandestine border crossing;
  • action against alien smugglers, document forgers and transiting illegal aliens from Central America;
  • curbs on the reentry of aliens deported from the United States.

U.S. initiatives that would cushion vulnerable American workers against the added disruption of immigration would be:

  • more generous adjustment assistance and better basic education and skills training for U.S. workers;
  • improved enforcement of safety, labor standards and residency requirements in immigrant-impacted firms and greater availability of legal workers for such firms;
  • protection of public assistance resources through better screening and identification of applicants; and
  • curbs on imports of low-wage temporary foreign workers for U.S. firms that will have access to Mexican labor in Mexico.

Finally, the United States must consistently press Mexico for higher safety, environmental and labor standards at the workplace to improve the job satisfaction and quality of life of working Mexicans who might otherwise migrate, as well as to narrow Mexico's unjustifiably wide labor cost advantages over the United States.


A U.S.-Mexico Free Trade arrangement will work momentous changes in Mexico's economy and in the flow of goods and people between the two nations. But these transformations will not come quickly or dramatically. The pace and direction of change will depend on the outcome of the meticulous product-by-product and sector-by-sector trade negotiations now underway. Most changes will be gradual, coming after prolonged phasing-in of reductions in tariffs, quotas and other barriers.

Recognition of Mexico's economic weakness could induce the U.S. and Canada to temporarily grant unilateral concessions on the entry of some Mexican products, while accepting a more gradual opening of vulnerable Mexican sectors, such as grain production, to U.S.. and Canadian competition.

Obviously, a full assessment of the trade agreement's consequences for international migration must await a completed agreement. But even then the contracting nations will have to continue intermittent negotiations for years to come as experience under the agreement brings new issues to the fore.

From a Prospering Mexico: Less Immigration or More?

It is unlikely that a North American Free Trade Agreement, even the most generous to Mexico conceivable under present political limits, will appreciably slow the outflow of Mexican migrants in the short-term to middle-term (ten to fifteen years). More likely, in the short-term free trade may stimulate even more migration from Mexico.

The Commission on International Migration and cooperative Economic Development, established in the 1986 Immigration Reform and Control Act (IRCA), concluded in 1990 that economic development in impoverished Caribbean Basin countries could increase rather than decrease out-migration:

While job-creating economic growth is the ultimate solution to reducing these migratory pressures, the economic development process itself tends in the short to medium term to stimulate migration by raising expectations and enhancing people's ability to migrate.1

Greater prosperity in Mexico would give many would-be migrants the means of covering the costs of migration, such as travel, documents, professional assistance, and the initial costs of settlement in the United States until work is found. Increased job opportunities in Mexico will only slightly offset the urge to migrate, as the gap between wages in Mexico and prospective earnings in the U.S. will remain wide in the initial years of a Free Trade Agreement. As economist Peter Morici states it:

Proponents have argued that free trade would close the gap between Mexican and U.S. wages. However, this would be a long process. Consider the following. If a revaluation of the peso were to raise the current Mexican wage to 20 percent of U.S. levels and if Mexican real wage growth were to exceed U.S. wage growth by 4 percent a year indefinitely — two fairly heroic assumptions — Mexican wages would reach 40 percent of U.S. levels after 18 years and 80 percent in 36 years.2

The Stubborn Momentum of Mexican Migration

Mexican immigration to the United States has grown rapidly since that country's economic growth began slowing in the 1970s, sharply accelerating in the early 1980s when Mexico's economy nearly collapsed under the weight of inflation, unmanageable debt, and a swollen and sluggish public sector. That momentum is apparent in the rise of apprehensions of illegals in the southwest. Such apprehension, which fell sharply for three years after the 1986 IRCA, climbed significantly in 1989 and, in 1990, soared above the one million mark for the first time since 1987. Preliminary INS figures for 1991 point to a further jump of about 3.0 percent in apprehensions.

From 1982 to 1990 Mexico's economy grew by an average of only about one percent a year, while its population was growing by 22 percent in the same period. Lashed by inflation, unemployment and wage stagnation, the average real income of Mexicans fell by more than one-third in the 1980s.

Mexico's labor force — the employed, the unemployed and the underemployed — grew by more than three percent annually in the 1980s, adding some 900,000 job seekers each year. Because of the large number of births in the 1970s and continuing long-term declines in infant mortality, new job seekers coming of age will swell the labor force by one million a year in the 1990s. The bleak economic climate and the persistence of Mexico's capital-intensive development strategy in much of the 1980s limited the creation of new full time wage jobs to no more than half the growth of the labor force.3 The Mexican government's figures for unemployment during 1991, published every Monday in the New York Times, average about three percent and would be the envy of most industrial nations. They are based on a more restrictive definition of unemployment than used in Western nations. Major Mexican trade union and employer groups, have estimated real joblessness at five times or more the official rate.4 Underemployment is also estimated to afflict as much as 40 percent of Mexico's labor force of 30 million people. While Mexico's economic growth promises to surpass four percent in 1991, indications are that job creation remains at about half to two-thirds of the growth of the labor force.5

Such massive underutilization of the labor force has accumulated over decades and will not end quickly or easily. Sidney Weintraub, a senior economist and specialist in Mexican trade and economic issues, finds that a sustained GDP growth of five to six percent, and three percent per capita annually, could profoundly alter the unemployment and poverty that drive immigration, but it would take two to three decades.6 For at least the next decade Mexico will continue to have a growing pool of candidates for immigration to the United States — legal and illegal — who have bad jobs or no jobs and who are lured by the wage differential in the united states that even rapid growth in Mexico will not soon narrow.

Out-migration from Mexican Farms and Industries Disrupted by Free Trade

At the outset, free trade will stimulate disproportionate unemployment in particularly vulnerable Mexican sectors, creating additional jobless candidates for migration to the United States. One particularly vulnerable group could be operators and workers of the small, inefficient and heavily protected Mexican farms producing grains, which can not soon hope to match the low production costs of imported American and Canadian products. Free trade in grains could increase rural migration to Mexico's cities and to the United States, as could adoption of President Salinas' proposal to permit holders of communal plots ("Ejidos") to sell their lands.

While Mexican perishable crop agriculture is expected to expand its share of the U.S. market under free trade (with accompanying displacement of citizen and immigrant workers in those sectors in the U.S.), the growth of new jobs in that sector in Mexico would only slowly and incompletely absorb workers displaced in other farm sectors.7 Some experts have suggested that the growth of perishable crop plantation agriculture within Mexico in response to free trade will boost, not reduce, migration to the United States, as it will increase the numbers of Mexican farm workers in the migrant stream within Mexico, many of whom would end up in the United States.8

Another sector of Mexico's economy likely to shed workers under free trade is the industries where featherbedding is commonplace, particularly the state-owned enterprises. Free trade will intensify the current emphasis on market forces in Mexico, speeding the closing or privatizing of white elephant public sector firms. The process will extend to labor-management relations, curbing the egregious overstaffing that pervades much of the Mexican economy, particularly the public sector. Some of the workers who lose their jobs in the streamlining process will opt for immigration.

Mexican private sector industries may face tough adjustment problems that increase layoffs in the short to mid-term. A fall 1991 poll by Mexico's National Confederation of Chambers of Industries showed 48 percent of their members felt that U.S. and Canadian competition could hurt their industries; 29 percent felt they would not survive the competition.9

Migration Driven by More than Earnings

Non-economic forces impelling Mexican migrants to the United States will remain powerful and persistent. The lure of family, friends, and large welcoming ethnic communities in the U.S. will not end with the adoption of free trade. More likely these social networks will expand and continue to draw thousands of new migrants even as the employment outlook in Mexico improves. Some 2.3 million formerly illegal Mexican aliens legalized since 1987 will start becoming eligible for U.S. citizenship in 1994. As citizens they will be entitled to bring spouses, parents and children to the United States without limits.

Free trade can also be expected to create new psychological and social perceptions in Mexico that could stimulate more migration.

The beginning of free trade — in effect, the end of economic borders with the United States — will be a watershed event in Mexico, a historic break with the past in the country's economic philosophy and its relations with the United States. This new relationship with their northern neighbor will be highly visible to Mexicans, increasing their perception of the United States as Mexico's "metropole" and making them more aware of the land to the north as an option for residence and work. Possibly reinforcing this will be the notion, however incorrect, that the free trade agreement has somehow invalidated the border or created an entitlement to live in the united States.

Free Movement of Labor — Negotiable or Not?

The Bush Administration claims it has agreed with Mexico that:

...labor mobility and our immigration laws are not on the table in the NAFTA talks, with the possible exception of narrow provisions facilitating temporary entry of certain professionals and managers.10

While such a position may be plausible at the opening of talks, over time in successive negotiations to revise and update the original accords, the Mexicans will strive to include labor mobility and immigration on the bilateral agenda as the new free trade area becomes institutionalized. Acceptance of free trade in services, with the accompanying provisions for special admission of professionals and managers in service occupations, can only reinforce the strength of networks drawing Mexican workers in large numbers to service industries in the United States, such as construction.

Moreover, Mexico's interest in access to the U.S. labor market is longstanding and its basic trade negotiating goal, as stated by Mexican representatives in the Uruguay Round of multilateral trade talks, may have been temporarily shelved, but not abandoned:

The expansion of the service exports of developing countries and their increased world trade in services depend on the liberalization of cross border movement of personnel covering unskilled, semi-skilled, and skilled labor. Such effective access to markets for their service exports can mainly be realized through this mode of delivery.11

With the three-nation trade agreement in place, U.S. officials may well be inclined toward even greater complacency than they currently are about managing the border properly and maintaining effective immigration controls. U.S. management of the southern border could come to resemble its relaxed oversight of the Canadian border — but without the safeguards of Canada's lower demographic pressures and that country's willingness to cooperate against illegal immigration.

Mexico's higher trading profile in the United States, and the preference its goods and services will have, could hasten the already well advanced penetration of Mexico's culture and language within the United States, making the country even more congenial and inviting to prospective immigrants from Mexico and elsewhere in the Hispanic world.

Mexico's management of its own immigration will be a factor in determining future outflow. A key question will be the extent to which trade-generated jobs in Mexico will become a magnet for additional illegal settlement of Central Americans, most of whose nations now have faster population and labor force growth than Mexico and, for now, even dimmer economic prospects. Left uncontrolled, Central American migrants in Mexico may well compete seriously with Mexicans for jobs. Under the Salinas administration, the Mexican government has shown greater appreciation of the costs of job competition and has quintupled deportations of Central Americans since 1988.12

Given Mexico's complaints about human rights abuses along its northern borders, Mexican authorities show little compassion for Central Americans attempting to cross illegally into Chiapas. Central American embassies in Mexico City regularly complain of theft, beatings and other abuses suffered by their countrymen attempting to travel northward.

Immigration Consequences over the Long-Term

The long-term effects of free trade in slowing immigration are more promising, though still matters of speculation. Among the positive prospects for easing future immigration pressure are:

  • By tying Mexico more closely to the United States and stimulating a market economy, free trade could arrest Mexico's economic decline of the last decade and increase stability. The ultimate immigration "nightmare scenario" of political and economic turmoil in Mexico spurring millions to flee northward becomes less likely.
  • Free trade will increase Mexican President Salinas' prestige and his confidence and ability to foster democratic practices and curb human rights abuses. Increased stability and a more hopeful political environment would encourage many Mexicans to see their futures as there rather than here. An improving quality of political life would encourage some return migration over the long-term, just as Mexican capital is now being repatriated.
  • Free trade will further spread U.S. culture and lifestyle within Mexico, along with U.S. products and services. A likely by-product will be even greater receptiveness to controls on fertility and greater access to the needed means for family planning. Mexico's population growth could slow further over the long-term.
  • As the imbalance between workers and jobs in Mexico decreases, the Mexican government will be more inclined to regard labor as a valued resource to be prepared and deployed rationally, rather than continue to tacitly encourage it to leave the country.
  • Free trade and investment will favor the transfer to Mexico of some labor-intensive, low productivity industries, some of which formerly survived in the u.s. through a continuous infusion of docile, low-cost foreign labor or through under-enforcement of environmental and safety regulations. Industries at risk include perishable crop agriculture, apparel, furniture, glass and auto parts. While worker dislocations will be painful, the U.S. would in some cases lose what have become immigration magnets, that had high costs in social overhead and environmental damage.
  • Much of the increased u.s. and other non-Mexican investment spurred by the free trade agreement can be expected to concentrate in northern Mexico and the border area. A good deal of the production for export to the United States — much of it from the in-bond "maquiladora" plants is already there, where the infrastructure, work force quality and accessibility to the United States are better. In the short run, the accompanying build-up of population and job-seekers near the U.S. will further spur attempts at unlawful entry. With time, more remote regions of Mexico, where labor and support services are cheaper, will acquire the modern amenities to draw a greater share of the investment and jobs. The tariff advantages that encouraged "maquiladora" industries to locate near their "twin" plants on the U.S. side will become less compelling. Over the long-term northern Mexico's status as an immigration "springboard" will diminish.

Double Jeopardy for American Workers

Free trade with Mexico, whatever its benefits, is likely to disrupt the lives of semiskilled job holders in U.S. light manufacturing, services and perishable crop agriculture. (Another particularly vulnerable sector is retail trade catering to Mexican customers at or near the Mexican border. Free entry of U.S. consumer goods into Mexico will lower the incentive to shop for them in the United States.) Often such vulnerable sectors make up a significant portion of the employment for whole communities.

Free trade would disrupt labor markets and impose hardship on these cities and towns.13 More immigration from Mexico could become an additional, particularly untimely disruption in those troubled industries and communities.

Advocates of free trade tend to minimize the disruption it can cause, arguing that it will be brief and transitory, that job creation in industries benefiting from free trade will absorb displaced workers, or that displacement would eventually come in any event, with or without free trade.

The most obvious and often cited danger to American workers is the transfer of existing u.s. manufacturing jobs to low-wage Mexico. Organized labor's spokesmen point out that the drain of jobs to Mexico has long been demonstrated in the working of the Mexican "maquiladora" program. Free trade will eliminate more of the existing requirements on content, U.S. sourcing of components, and other conditions that until now have acted as a brake on the transfer of jobs across the border to "maquiladoras".

Another threat of free trade to American jobs is the prospective diversion of future U.S. and foreign capital investments to Mexico, capital which in the absence of free trade would have remained in the United States. The prospect of extensive Japanese and European investments in Mexico targeting the American market are particularly ominous for a U.S. labor force increasingly short of skills because of deficient public education. The combination of Japanese and European technology and the energetic low-wage Mexican work force would leave American workers at a serious competitive disadvantage and could cause some U.S. employers to opt for even lower wages as a survival tactic. Free trade may well create labor force adjustments that are much greater than anticipated by econometric studies or by the optimistic prognoses of administration advocates.14

A major defense of free trade is that any loss of low-skill jobs to Mexico under free trade would be offset by the growth of high skill, high wage jobs in U.S. industries expanding their exports to Mexico. But the pro-free market Mexican President Carlos Salinas will rule Mexico only until 1994. He cannot succeed himself. Salinas is likely to select a successor who will not allow backsliding. But as Mexico democratizes, the hand-picking of Presidents may become more difficult in the future. There can be no guarantees that, after the U.S. has opened its markets, future Mexican leaders will not turn Mexico back toward its traditional protectionist and statist trade and development policies, reemphasizing state-ownership of industries and non-tariff barriers to trade.

More Immigrants, But Less Skilled

In such a case, American workers would find themselves in the worst of all possible worlds: the continued drain of low-skill jobs to Mexico; the gain of relatively few high-skill jobs from exports to Mexico; and the continued influx of Mexican workers into low-skill industries and service occupations in the United States.

Rapid expansion of industries in Mexico in response to free trade has implications for the quality as well as the quantity of northbound migrants. As job opportunities grow in Mexico, employers are likely to hire first the most skilled and adaptable among the unemployed and underemployed, leaving many of the less gifted to seek work in the farms and service industries of the United States. This tendency will adversely affect productivity, wage levels and the cost of public services in migrant-impacted areas of the United States.

Seeking Mexico's Cooperation in Slowing Illegal Immigration

Clearly, resident U.S. workers in a range of occupations and industries face labor market disruptions. Many of the workers most at risk in the adjustment process will themselves be settled immigrants from Mexico and other Latin American countries or native-born minorities. The solution offered by the classical economists, that these workers will be absorbed into the better jobs in the U.S. industries gaining from free trade, is at best theoretical and disregards the uneven distribution of the pain of the transition. The workers most vulnerable to displacement often the least able because of low skills to make that transition easily. Many of them could be displaced into the service sector, where they will face the prospect of competing for low skill, low wage jobs with disadvantaged minorities and immigrants.

Thus the impending Free Trade Agreement will heighten the need for more effective immigration control in the United States. The volume of future immigration from Mexico — and from elsewhere in Latin American through Mexico — will be a determinant of the success or failure of less skilled resident workers in adapting to the new labor market conditions stemming from free trade. The adjustment of U.S. workers to the intense low wage competition of Mexican workers in industries in Mexico would be eased by measures to reduce the competition from low wage Mexican and Central American workers in the U.S. labor market.

Bargaining for Mexico's Cooperation: A Shared Interest in a Tighter Border

A free trade regime will invest Mexico with a greater stake in better regulation of the outflow of its workers to the United States. Mexico's primary comparative advantage in attracting major foreign investment and keeping its products competitive in the U.S. and Canadian markets will remain the low wages. continued easy access of Mexican workers to jobs in the U.S. through uncontrolled emigration, while depressing U.S. wages in areas of major immigrant settlement, simultaneously puts upward pressure on wages in Mexico as Mexican employers are forced to compete for labor with U.S. employers. Although Mexican leaders do not openly acknowledge it, a successful strategy of a looser border with the U.S. for trade purposes makes desirable a tighter border for migration to lessen imported wage competition if it is to preserve its comparative advantage.

Such immigration and related labor and manpower issues are critical to any negotiations of the terms and conditions of free trade. U.S. and Mexican negotiators must address them either in the trade talks themselves or simultaneously in separate high level bilateral forums. The United States has entered these negotiations with considerable leverage. The prospect of free access to the greatest single market in the world is a major concession for Mexico that justifies far-reaching accommodations by Mexico to U.S. needs for curbing illegal immigration. Armed with major trade benefits from the U.S., Mexico in turn would be able to justify politically difficult concessions on immigration control to its own public.

What could the united states reasonably ask Mexico to do to ensure that continued illegal immigration does not worsen the adjustment pains of American workers to free trade?

For Mexico: Adherence to its own Migration Rules

In general terms, the United states must press Mexico to begin enforcing some of its own elaborate laws on immigration and trans-border travel that have become virtual dead letters over the decades. Mexico should become as vigilant of its northern border as it is of its southern frontier. An appalling double standard now exists. Such urging will not be well received or easily acted upon. since the 1950s Mexican spokesmen have disingenuously claimed that the government cannot abridge the constitutional right of its citizens to leave their country.15 But Mexico's constitution and laws, as do U.S. laws, prescribe the conditions under which Mexicans must enter and leave the country — conditions that are now ignored by millions.

Migration of Mexican citizens is governed by the Ley General de Poblacion of 1974 (General Population Law), most recently amended in 1990. That law forbids surreptitious entry into neighboring nations. Article 11, Chapter 5 states:

International transit of persons through ports, airports or borders may only be effected through the places designated for it and within the time periods established for it, and with the involvement of the migration authorities.

Article 78, Chapter 4, of the General Population Law requires Mexicans intending to emigrate to meet the following conditions:

  1. Identify themselves and provide personal data to migration officials.
  2. Present proof that they meet all entry requirements under the laws of the country of their destination.
  3. Obtain for presentation to migration officials at the port of departure documentary proof that the intending emigrant is not a fugitive from justice or subject to a court order.
  4. If emigrating to work, be in possession of a work contract with adequate salary approved by the local labor board. Migration officials must have the conditions of employment in writing, approved by the Consul of the country of destination.

Other provisions require the possession of Mexican passports for most categories of Mexicans traveling abroad. Certainly, a strong statutory basis exists if the Mexican government opts to control border flows with greater rigor.

Transborder Cooperation in Enforcement

The Mexican government in recent years has cooperated sporadically with American authorities on law enforcement concerns that affect immigration control. Consistent with past cooperation and in keeping with the closer relationship signaled by the Free Trade Agreement, the United States should seek continuing and consistent cooperation from Mexico in the following law enforcement concerns:

  1. Assistance in detecting and apprehending "Coyotes", smugglers of illegal aliens. who violate both nations' laws through greater sharing of information. coordinated police work and cooperation in prosecution. A sizable percentage of all illegal entries of Mexicans and other Western Hemisphere citizens is now smuggler-assisted, resulting in widespread exploitation of vulnerable travelers and serious corruption of law enforcement officials.
  2. A crack-down within Mexico on wholesale counterfeiting of U.S. identification and work authorization documents, and greater information sharing about document forgery rings in Mexico and Central America. Also needed is greater Mexican vigilance against forgery, fraud and imposture in the use of its own passports and other Mexican travel and identification documents.
  3. Aid from Mexican officials in discouraging reentry into the U.S. of Mexican citizens and third country nationals who have been deported from the U.S. Reentry into the United States after deportation is a felony offense. Yet reentry of criminal aliens, who have been deported after serving sentences in U.S. penal institutions, remains a serious law enforcement problem for state and federal authorities. For non-criminal Mexican aliens deported or given voluntary departure from Mexico, there should be greater Mexican commitment to directing them to jobs in Mexico, particularly as employment expands with free trade.
  4. Pre-clearance and Interior Repatriation. Mexico should resume its earlier practice of allowing the u.s. Immigration and Naturalization service (INS) to return apprehended illegal aliens to areas near their homes in the interior of Mexico. Mexico's permission is needed as well for INS "pre-clearance" of travelers at major ports of departure within Mexico.

Tight curbs by Mexican officials on the transit of Central Americans and other third Country illegal aliens through Mexico. The record of Mexican cooperation against the traffic in Central Americans has improved under the Salinas administration. The U.S. has provided modest funds to Mexico to assist with the cost of deportation.16 Curbing Central American illegal immigration into Mexico will become increasingly important for Mexico itself. Central America's population and labor force growth is even more rapid than Mexico's and migrants from those countries will be increasingly attracted to the relatively higher paying jobs in Mexico created by the expansion of free trade with the United States.

U.S. Actions to Cushion the Shock of Free Trade

To be credible in negotiations on these points, the United States itself must show its commitment to cushioning vulnerable American workers and industries against the shock of free trade. Quite apart from specific issues with Mexico on the management of immigration, the United States must improve and fully fund its program of adjustment assistance to workers of industries hurt by free trade, with liberal grants for retraining and relocation. The declining proficiency of much of the U.S. work force, reflected in stagnant wages and widespread "deskilling" of jobs, attest to the general need for urgent improvements in basic education and workers' skill training. The problem has been amply diagnosed by a number of high-level official and non-governmental commissions. Action is needed. Continued stagnation of American worker skills could well mean an unexpected loss of higher skilled jobs to Mexico along with the low-wage, labor-intensive jobs expected to go. Immigration policies that encourage the continued importation of" masses of low-skill foreign workers can only aggravate this fundamental deficiency of the American labor force.17

In a time of recession and great budgetary austerity, funds will be tight for relocation and retraining of American workers displaced by free trade, or regular unemployment benefits, food stamps and other programs that mitigate the blows of joblessness, or for vocational and adult educational programs. The United States must ensure that the diminishing pool of resources goes to legitimate claimants. More effort is needed at Federal and State administrative levels to:

  • develop ID systems to guard against fraudulent claims for benefits by aliens and to vigorously prosecute those violations uncovered.
  • conscientiously enforce the "deeming" provisions of Social Security and related legislation, that require inclusion of the resources of aliens' sponsors in means testing for eligibility for certain public assistance.
  • reinvigorate and expand the "SAVE" system, INS's computer matching system for verifying aliens' public assistance entitlements.
  • recognize that while the law requires free primary and secondary public education for illegal alien children, it does not require aliens to receive free or subsidized public higher education, or adult education and Joint Training and Partnership (JTPA) courses.

Better Enforcement of Labor, Safety and Environmental Standards in Both Nations

The United States must also show it is determined to enforce its own labor, safety and related immigration laws, particularly in those industries exposed to competition from Mexico. Industries already beset by low labor and safety standards, such as perishable crop agriculture, some types of construction, apparel (where sweatshops remain a way of life) and other types of light manufacturing, may seek to survive against Mexican competition using a "sweatshop'. strategy, further cutting corners on labor conditions and relying more on illegal alien workers. The nation gains little from preserving industries in its territory that use such practices to survive.

The U.S. response must be a more diligent, by coordinating enforcement by Federal and State authorities of employer sanctions and wage and hour, child labor, and health and safety laws. Immigration and employment service officials must work more closely to channel authorized workers into firms prone to use illegal aliens. Greater restraint must be shown in authorizing the legal importation of low wage workers for industries that will be most exposed to direct competition from Mexico. A case in point has been the admission of Chinese and Philippine seamstresses in recent years for struggling U.S. garment shops. As the free trade agreement gives U.S. apparel entrepreneurs access to cheap Mexican labor in Mexico, it makes less sense to continue subsidizing those firms with imported low wage workers from abroad for their U.S. operations.

Some of the "comparative advantages" Mexico enjoys in labor costs stem either from the authoritarian nature of its government which curbs trade union freedoms, or from its unwillingness to implement its own lofty, proclaimed political, labor and environmental standards. Over the long-term Mexico's lagging standards are likely to become increasingly troublesome to the United States and Canada as the free trade agreement tightens the bonds among North American nations. Labor savings for Mexico based on low safety and environmental standards or curtailment of trade union freedoms are not likely to be acceptable to its North American competitors over the long-term.

From the standpoint of migration, high occupational safety and environmental standards and democracy at the workplace will all increase the rewards of jobs in Mexico to Mexican workers who might otherwise migrate, while enhancing the general quality of life for other Mexicans. While the U.S. and Mexican governments have acknowledged the need for action on some of these issues, U.S. negotiators must insist that Mexico offer more than additional empty laws and decrees and vague promises of future improvements.

To give punch to its commitment, the U.S. might consider encouraging American investors in Mexico produce for the U.S. market, as well as Japanese and other multinational exporters operating there, to voluntarily adopt high labor, environmental and safety standards.


Under free trade, the U.S. and Mexico, as never before, share a common interest in keeping Mexico's workers in Mexico. Mexico's large pool of available, inexpensive and adaptable workers is its premier comparative advantage; for U.S. and other prospective multinational investors or importers, Mexico's labor reserve is the major attraction of a free trade agreement.18 The United States has in addition an interest in shielding its own least skilled workers in vulnerable industries from the competition of imported workers at a time when free trade will cause disruption and displacement.

Restraint on low skilled immigration will also ease the competition of vulnerable American and settled legal immigrant workers for the public assistance and educational resources they will need to see them successfully through the transition. By insisting on high labor, safety and environmental standards in Mexico, particularly among those multinationals most likely to benefit in the American market, the United States would protect the long-term political acceptability of free trade among its own electorate; encourage democracy and a better quality of life within Mexico and neighboring U.S. areas and reduce incentives to emigrate; and ease the competitive burden on American workers by narrowing the production cost advantages Mexico gains from its unjustifiably low workplace and environmental standards.

End Notes

1 Unauthorized Migration: An Economic Development Response, Report of the Commission for the Study of International Migration and Cooperative Economic Development, July 1990.

2 Peter Morici: Trade Talks with Mexico: A Time for Realism, Washington, D.C.: National Planning Association, 1991.

3 Leon Bouvier and David Simcox: Many Hands, Few Jobs: Population, Unemployment and Emigration in Mexico and the Caribbean, Washington, D.C.: Center for Immigration Studies, 1986.

4 American Federation of Labor-Congress of Industrial Organizations: Exploiting Both Sides: U.S.- Mexico Free Trade, position paper: Washington, D.C., February, 1991. A 1989 study by Mexico's National Confederation of Chambers of Industry found 50 percent of Mexico's labor force, or 14 million workers, were unemployed or underemployed, with that number growing by half a million in 1988. See "14 Millones de Desempleados en el Pais," Diario Las Americas, February 14, 1989.

5 Mexico Business Monthly, Vol. 1, No.6, August 1991: Officials of the Mexican Embassy in Washington, DC in 1991 estimated job growth at 600,000 to 700,000 a year.

6 Sidney Weintraub, "The Rise of North Americanos: A U. S.-Mexico Union," The Responsive Community, Vol. 1, No.3, Summer 1991.

7 H. L. Goodwin, Jr., "U.S.-Mexico Free Trade Agreement: Agricultural Labor Issues," Texas Agricultural Market Research Center Report, No. IM-11-91, Texas A&M University, April 1991.

8 Philip L. Martin, Memorandum to the Agricultural Commission regarding: "January 16-17, 1991 Westlaco, Texas, Hearing and January 15, 1991 Washington FTA Meeting," January 22, 1991.

9 "Mexico Poll on Trade Plan," Wall Street Journal, October 31, 1991.

10 Letter of President George Bush to congressional leaders on "Response of the Administration to Issues Raised in Connection with the Negotiation of a North American Free Trade Agreement." May 1, 1991. Quoted in Mexico Business Monthly, June 1991.

11 Quoted in: AFL-CIO: Exploiting Both Sides, previously cited.

12 Bill Frelick, "Mexico Deports 80,000 in First Six Months of 1990," Refugee Reports, Vol XI, No.9, September 28, 1990.

13 Morici, previously cited.

14 Morici, previously cited.

15 Article II, Political Constitution of the United Mexican States.

16 "U. S.-Mexican Cooperation against Illegal Transit of Central Americans through Mexico Under Fire," Scope, No.7, Spring, 1991.

17 Vernon M. Briggs, Jr., "Immigration policy: Political or Economic?" Challenge, September-October, 1991.

18 Jeff Faux and William Spriggs, "U. S. Jobs and the Mexico Trade Proposal," Briefing Paper, Economic Policy Institute, Washington, D.C.

David Simcox is the former Chairman of the Board of Directors of the Center for Immigration Studies and heads Migration Demographics in Louisville, Ky.

Topics: Politics, Mexico