Kentucky voices

Ky. Voices: Mexicans staying home as economy improves, reforms

February 3, 2013 

Kristal Eldredge Alley

It's a great time for the U.S. to address immigration. Not only because it makes good political theater against a backdrop of changing electoral demographics, but because Mexicans are staying home.

Of the estimated 11 million illegal immigrants currently in the United States, well over half are from Mexico. By and large, they came to the U.S. pulled by the prospect of providing a better life for themselves and their children. One only has to read the inscription on the Statue of Liberty — "Give me your tired, your poor, your huddled masses yearning to breathe free" — to remember that the U.S. has always been a magnet for immigrants.

As former British Prime Minister Tony Blair once said: "A simple way to take measure of a country is to look at how many want in... And how many want out." According to a 2009 global Gallup survey, roughly 700 million adults worldwide would like to move to another country if given the opportunity, and 165 million of these picked the U.S. as their top choice.

Yes, despite our dysfunctional politicians and lackadaisical economic performance, we've still got it.

However, what is changing is the motivation for migrating from Mexico to the United States. Despite the constant pull of the U.S. magnet, according to studies by the Pew Hispanic Center, migration from Mexico to the U.S. has been net zero since 2007, and this trend shows no signs of abating. While the reason for the fall in net Mexican migration is perhaps largely due to the impact of the financial and economic crisis on the U.S. economy, things are also changing south of the border.

According to the Heritage Foundation's 2013 Index of Economic Freedom, Mexico's economic freedom score is 67 (out of 100) making it the 50th freest economy among the 185 countries ranked. Its score is 1.7 points better than last year, reflecting notable improvements in investment freedom, trade freedom, and monetary freedom.

While this is good window dressing, more importantly, the unemployment rate in Mexico fluctuated between 4.5 percent and 5.4 percent in 2012, and GDP continues to expand at about 4 percent per year — numbers the U.S. would be thrilled to boast.

Of particular interest for the future of the business and economic climate are reforms enacted as 2012 drew to a close. In December 2012, Mexico enacted a new federal labor law, the first major update in 40 years. It purports to provide stronger protections to workers and wider flexibility for companies to adjust to changes in demand. The law establishes provisions that allow companies to dismiss employees more easily and employees can now be promoted on the basis of merit instead of only seniority.

At the same time, Mexico became the 89th member and only third Latin American country to join the Madrid Protocol. The Madrid Protocol makes protecting trademarks easier for foreign companies doing business in Mexico and Mexican companies expanding abroad. For example, if an American company applies to WIPO (World Intellectual Property Organization) and receives approval, its brand will automatically be protected in Mexico.

Ultimately, these and other measures aim to support the creation of new and better-paying jobs and increase Mexico's global competitiveness. Reinforcing economic growth in Mexico will do more than walls, more razor wire or guns at the border will ever do. And, in the end, help put a win in America's bipartisan political column.

Kristal Eldredge Alley, a Lexington native and University of Kentucky graduate, lives in Mexico City and manages her own international consultancy.

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