Tuesday, November 20, 2007

Mexico's job promises unfulfilled

Last year President Felipe Calderon promised jobs for all, but of 44 million working Mexicans, only 15 million have jobs with benefits.

In March, Mexico's President Felipe Calderon announced plans to quadruple lending to small businesses in an effort to create jobs. Millions still lack jobs with benefits.
AP FILE PHOTO, 2007
In March, Mexico's President Felipe Calderon announced plans to quadruple lending to small businesses in an effort to create jobs. Millions still lack jobs with benefits.

César Mora has been looking for steady work for three frustrating years since he graduated with a degree in applied mathematics from Mexico's National Autonomous University.

He has gone to countless interviews alongside an army of young people competing for the precious few jobs in the nation's biggest city. He has watched his college buddies resort to selling software in Mexico's pirate markets to survive. Mora, now 30, lives with his parents, does odd jobs like fixing computers and wonders if his career will ever start.

''It's sad, but it's the reality here,'' Mora said. ``The diploma is just for pride. . . . Companies here don't need workers.''

Mora is yet another victim of the grinding job market in Mexico, which hasn't created enough jobs for its people in more than two decades. Mexico's inability to create jobs has sent college graduates and rural farmers alike across the border or into the nation's vast informal sector, where they sell tacos at intersections or bootleg DVDs without paying taxes or receiving social security.

UNEMPLOYED YOUTH

Of the 44 million economically active Mexicans, only an estimated 15 million have formal jobs with state-mandated benefits and social security. The situation is particularly acute among the nation's youth: More than 40 percent of Mexicans aged 15 to 24 can't find a job, according to the nonprofit group Young Entrepreneurs for Mexico.

A year ago, President Felipe Calderón campaigned as the ''Candidate of Jobs,'' promising what no Mexican president in 25 years has been able to deliver: to create enough jobs for its people.

But as Calderón nears his first year in office on Dec. 1, his administration's record on job creation is shrouded in mystery and controversy.

Leftist critics say Calderón has yet to create the promised jobs and blast his first efforts as disasters. Conservative economists and government officials tend to see Calderón's efforts as bearing fruit.

NEW JOBS

Last month, Calderón bragged that his job creation efforts have resulted in 825,000 new jobs through Oct. 15, more than 30 percent ahead of even the government's optimistic projections.

Yet few in Mexico put much stock in those numbers. More than half the new jobs are temporary, and government statistics are notorious for reflecting a rose-colored version of reality (Mexico's official unemployment rate of 3.8 percent is often dismissed as greatly distorted).

Mexico's job challenge is frightening: The country needs about 1.3 million new jobs annually just to make room for young people entering the workforce. That does not account for the estimated 27 million underemployed and unemployed Mexicans, millions of whom have fled across the border in search of work. The maquiladora industry, once considered the panacea for Mexico's job woes, has suffered in recent years as factories moved to China and Central America; it now employs fewer Mexicans than it did in 2000.

Most analysts agree Mexico needs about 6 percent annual economic growth to reach its job creation target. This year, Mexico' s economy is on pace to grow by 2.9 percent, among the lowest rates in Latin America. Government estimates are for around 5 percent growth by the end of Calderón's term in 2012.

Such numbers mean little to Yolanda Méndez, a 40-year-old divorced mother of five who hasn't seen opportunities grow during Calderón's first year in office. Méndez sells prepaid cellphone cards at an intersection in southern Mexico City, taking home about $35 a week in salary and another $2 to $20 a day in commissions.

''For a long time I looked for a different job, but places were giving me work for minimum wage, for 10 hours a day and without social security,'' she said. ``Working in the street in the middle of buses and cars isn't easy. I get sore throats a lot and almost every day I get headaches.''

Analysts say Calderón doesn't want the government to directly fuel job growth. Rather, he is focused on creating the conditions to allow private investment to thrive, creating jobs in the process.

''The strategy of the government is to maintain stable macroeconomic factors,'' said Ernesto Cervera, an economist with the conservative Mexico City GEA think tank.

FOREIGN INTERESTS

The Calderón administration says investment, mostly foreign, reached more than $13 billion in the first half of 2007, nearly 40 percent more than the same period in 2006. Most goes to the tourism, transportation and construction industries.

''The investors are reflecting a great confidence in the country, in terms of what this government has shown in political maturity, negotiation with opposition political parties, with an electoral reform, a fiscal reform, reforms to government pensions and social security,'' said Omar Rodriguez, director of labor policy for the Calderón administration.

FIGHTING DRUG CARTELS

The Calderón government also trumpets its anti-narco strategy -- it sent more than 20,000 soldiers to confront increasingly violent drug cartels -- in making the country more attractive to investors. ''That is also part of the jobs policy,'' Rodríguez said. And Calderón wants college degrees to better match the needs of emerging businesses, especially in the realm of technology.

But critics, especially those who oppose the neo-liberal path Mexico embarked upon in the 1980s, say the government lacks a coherent job creation strategy and has abdicated its role in the process.

''Private companies aren't looking out for the development of nations,'' argued Javier Aguilar García, an economist at Mexico's National Autonomous University. ``They are looking to generate profits, not jobs. Their logic is a different one.''

Both big business and entrenched unions in Mexico also get blamed for the nation's stagnating workforce: Monopolistic companies like Telmex, the Carlos Slim-owned company that controls 94 percent of the country's fixed telephone lines, have little incentive to offer competitive salaries, analysts say. And unions get blamed for squeezing new jobs because hard-won worker benefits, such as generous pensions and severance packages, make it too expensive for many smaller firms to hire new workers.

Calderon defends Mexican migrants

Border fence between US and Mexico
Calls have grown in the US for tighter border security
Mexican President Felipe Calderon has called on US presidential hopefuls to stop verbally attacking illegal Mexican immigrants to score political points.

Candidates were taking Mexicans as "symbolic hostages" in speeches and debates on immigration issues, he said.

Mr Calderon said he was worried by what he called the "growing harassment" and "persecution" of Mexicans in the US.

Illegal immigration is among US voters' top concerns and is set to be a key issue in the 2008 presidential poll.

It is estimated some 12 million illegal immigrants live in the US, many of them from Mexico.

In a speech to an agency representing migrants, Mr Calderon said his government's duty was to protect the rights of Mexicans living abroad.

"I am especially concerned at the growing harassment and in recent days the persecution of Mexicans in the US," Mr Calderon said.

"It is my duty to call respectfully but firmly on the candidates of the political parties in the US to stop taking Mexicans as symbolic hostages in their speeches and strategies."

Immigration reform

Mr Calderon's remarks seemed aimed both at the hard line some candidates have taken on the immigration issue and the reluctance of other candidates to take clear positions in the debate, correspondents say.

There are consequences to open borders beyond the 20 million aliens who have come to take our jobs
Tom Tancredo
Republican presidential candidate
The Mexican president outlined steps his government planned to take to help Mexican migrants, including a project to expand shelters for people deported back across the border.

His government would also launch media campaigns to increase the awareness of the contributions migrants make to US society, Mr Calderon said.

US President George W Bush's attempts to overhaul immigration laws collapsed amid heated debate in Congress earlier this year.

The question of how to address illegal immigration, without alienating the large Hispanic electorate, is a tricky political issue for candidates.

Rhetoric

The debate has also touched on questions of national security, with several candidates arguing there is a need for tougher border controls to prevent potential terrorists entering the country.

Among them is Republican outsider Tom Tancredo, who this week released a hard-hitting campaign advertisement that appears to associate illegal immigrants with extremism.

The advertisement shows images of a hooded man in a crowded shopping centre and clips of bombings in Europe as the narrator says:

"There are consequences to open borders beyond the 20 million aliens who have come to take our jobs.

"Islamic terrorists now freely roam US soil, jihadists who froth with hate, here to do as they have in London, Spain, Russia.

"The price we pay for spineless politicians who refuse to defend our borders against those who come to kill."

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