1,037,900 Jobs Deficit: U.S. Created 16x as Many Jobs in Mexico as Mexico in U.S.

By Terence P. Jeffrey | June 12, 2015 | 3:17pm EDT
(AP Photo)

(CNSNews.com) - U.S.-majority-owned multinational enterprises employed 1,106,700 in Mexico in 2012 (the latest year on record), according to data released by the U.S. Bureau of Economic Analysis, but Mexican-majority owned enterprises employed only 68,800 in the United States that year.

That means that U.S.-controlled multinationals employed 1,037,900 more people in Mexico than Mexican-controlled multinationals employed in the United States.

Put another way, multinational enterprises that had a majority U.S. ownership employed 16 times as many people in Mexico as Mexican-controlled multinationals employed in the United States.

Forty-nine percent of the jobs--546,500 of 1,106,700--that U.S.-controlled multinationals maintained in Mexico in 2012 were in manufacturing, according to the BEA. (See Table 5.2 in the August 2014 BEA report "Activities of U.S. Multinationl Enterprises in 2012.")

Those 546,500 Mexican manufacturing workers employed by U.S.-controlled multinationals included at least 100,000 in transportation equipment manufacturing, 71,300 in food manufacturing, 53,700 in computer and electronic products manufacturing, 34,000 in machinery manufacturing, 32,200 in chemical manufacturing, 30,500 in electrical equipment, appliances and components manufacturing, 18,600 in primary and fabricated metals manufacturing.

Of the 68,800 that Mexican-controlled multinationals employed in the United States in 2012, 56,200 were in manufacturing, according to the BEA.

The 546,500 that U.S.-controlled multinationals employed in manufacturing in Mexico was almost 10 times as many as the 56,200 Mexican-controlled multinationals employed in manufacturing here.

The overall number of workers that U.S.-majority-owned multinationals employ in Mexico has been increasing.

The BEA has published the total number of all Mexico-based employment by U.S.-majority-owned multinationals (including banks) since 2009. In that year, U.S.-controlled multinationals employed about 969,000 in Mexico—or 137,700 fewer than the 1,106,700 they employed by 2012. (The BEA has not yet published numbers for 2013 and 2014.)

By contrast, Mexican-controlled multinationals employed about 52,000 in the United States in 2009—or 16,800 fewer than the 68,800 they employed by 2012.

In the four years from 2009 through 2012, U.S.-controlled multinationals hired 8 net additional employees in Mexico for each net additional employee that Mexican-controlled multinationals hired in the United States.

In 1993, the U.S. Congress approved the North American Free Trade Agreement (NAFTA) using a fast-track procedure. The agreement, negotiated by the Clinton administration, was designed to remove tariffs between Mexico, the United States and Canada. Under fast-track, Congress was allowed to approve the deal by a simple majority vote in both houses and neither house was allowed to consider amendments to the deal. NAFTA took effect at the beginning of 1994.

In the four years leading up to and including 1994, according to data published by the Census Bureau, the U.S. ran a surplus in its bilateral trade in goods with Mexico. But in each of the 20 years since then (1995-2014), according to the Census Bureau, the U.S. has run a trade deficit with Mexico.

The overall volume of bilateral U.S.-Mexican trade in goods has increased massively during that time period, but the balance of trade has shifted dramatically in Mexico’s favor.

In 1993, the year before NAFTA took effect, the U.S. exported $41,580,800,000 in goods to Mexico and imported $39,917,500,000. Thus, the U.S. ran a 1993 trade surplus of $1,663,300,000 with Mexico.

Similarly, in 1994, the first year of NAFTA, the U.S. exported $50,843,500,000 in goods to Mexico and imported $49,493,700,000—running a surplus of $1,349,800,000.

In 1995, the U.S. trade in goods with Mexico slipped into the red. The U.S. exported $46,292,100,000 to Mexico and imported $62,100,400,000—for a deficit of -$15,808,300,000.

In 2014, the U.S. exported $240,248,700,000 in goods to Mexico, but imported $294,074,100,000—running a trade deficit of $53,825,400,000.

That deficit was almost 40 times larger than the last trade surplus the U.S. ran with Mexico in 1994.


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