Link Search Menu Expand Document
Publications
  1. NAFTA and other factors that can affect maquiladoras

NAFTA and other factors that can affect maquiladoras

Maquiladoras began their rise in the Mexican economy during the eighties after President Salinas de Gortari advocated for the deregulation of the industry in an attempt to raise the Mexican economy (Kopinak, 1995). They were established in 1965 as part of the Border Industrialization Program (BIP) and were labeled as “Fordist assembly plants” that mostly employ women (Kelly, 2001). During the creation of maquilas, they were limited to the border region but have since expanded to the interior of the country. Maquiladoras are tariff and duty-free assembling plants owned by transnational companies (Kopinak, 1995). Maquilas allowed for the most labor-intensive parts of production to be located in the factories where they do not meet the regulations the United States must adhere to. They are known for their arduous labor, low wages, and failure to meet health and safety standards (Kelly, 2001).

The rapid growth of maquilas began in 1982 when during his presidency, de la Madrid created programs that encouraged foreign companies to invest in and expand the maquilas. These programs made maquilas the centerpiece of Mexican exports (Kelly, 2001). Under president Salinas de Gortari, there was a push for industrialization, various regulations were dropped and the gender gap and rate of employment grew even further (Kopinak, 1995). By 1996 about one-third of the labor force in Mexico was employed at maquiladoras. That was a five percent increase compared to numbers from 1982 (Kelly, 2001). Maquiladoras attracted women who moved from all over the country, wanting financial independence that only the maquilas could offer (Livingston, 2004).

The gender gap in the maquiladora industry is also widely acknowledged. During the beginning of maquilas, female employment had a rate of approximately 85 percent and while in 1988 the figure had dropped to 64 percent, maquilas continue to mostly employ women typically between 16-24 years of age (Kelly, 2001). Women were hired because it was believed that they would be better at assembling the pieces due to their nimble fingers (Wright, 1997). Despite women dominating the maquilas, they are paid lower salaries than men and rarely hold higher positions. Women are also viewed as subservient and a group that cannot be trained and learn new profitable skills (Wright, 1997). Maquila employees often do not earn salaries that allow them to live comfortably (Funari, 2006). Wages have remained stagnant and are usually calculated as net pay per day instead of the usual hourly wage when compared to the United States (Staudt, 2018). Women workers are often placed in colonias, which are small communities where many of the maquiladora workers can afford to live (Kelly, 2001). These small communities often do not have high standards of living and homes are made out of substandard materials and often have to take public transportation into the city to make it to the maquiladoras (Sánchez, 2014).

The North American Free Trade Agreement (NAFTA) was enacted in 1994 and included Canada, The United States, and Mexico. This agreement allowed for all tariff and non-tariff barriers between the three countries to be eliminated (Federal Register, n.d.). It resulted in the economy moving towards an export-oriented trend (Kelly, 2001). NAFTA changed Mexico and fostered a dependency on the United States of America for exporting most of its goods (Staudt, 2018). NAFTA’s purpose was to reduce the tariffs and break down some of the barriers between countries to export and import goods between them (Camacho, 2006). Despite the reports of the dangers in the maquiladoras, the industry did not show a decrease in employment after NAFTA was enacted (Staudt, 2018).

One of the ways NAFTA changed the maquiladora industry was by implementing a “speed-up process”. This process consists of selecting an employee and assigning them to do the work that was usually performed by multiple employees. That was shown to increase productivity despite creating more stressful conditions for various employees who have to undertake the work of others (Staudt, 2018). The North American Free Trade Agreement was created to boost the production of service goods with the United States using the low-skilled labor of mostly women to export those products. It valued the production of material goods while ignoring the basic needs of the workers (Camacho, 2006).

The regulations previously stated in NAFTA changed during 2016 under Donald Trump’s presidency after his many criticisms of the trade deal. These changes are not studied in this review since the effects were seen in the years after 2016 and there is a lack of recent data and a full comprehension of how the trade agreement has changed the industry. The main focus of this review is the changes the low-wage manufacturers underwent, however, it is still important to mention how NAFTA showed changes to the environment by creating associations that would protect it from the labor industry, promoted the growth of the middle class in Mexico, and privatized a large portion of the agricultural sector (Staudt, 2018).

Table of Contents