Thread: U.S. slowdown squeezes Mexico's migrant worker bounty

By Jason Lange
Wed Jun 18, 10:30 AM ET



TONATICO, Mexico (Reuters) - The mountain of cash sent home by Mexicans in the United States is shrinking for the first time in over a decade, putting the dampers on Mexico's economy as a U.S. slowdown takes work away from immigrants.

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In rural towns like Tonatico, in central Mexico, where about half the men are in the United States, rodeos and country dances are being canceled and restaurants, which play U.S. hip hop music brought home by returning sons, are languishing.

Migrant remittances have brought a major injection of dollars in Mexico over the last decade, and forced belt-tightening by the millions of families who depend on money transfers is hurting the economy's important retail sector.

"We have to be a lot more careful with our money," said Jaime Trujillo, a town councilor who depends on family members in the United States to send money that pays for oxygen tanks for his ailing grandmother.

"People aren't buying anything, and it's been a long time since we've had a rodeo," said Trujillo.

Mexico's migrant bounty, which last year totaled nearly $24 billion, slipped 2.4 percent during the first four months of this year -- the first sustained fall in remittances since the central bank started measuring them in the mid-1990s.

The money flow had risen every year, but growth slowed in 2007 and analysts expect the tighter U.S. job market to continue hurting remittances in the months ahead as Mexican get less work in jobs ranging from gardeners to factory workers.

Both economists and migrants say a U.S. crackdown on illegal migration is also making it tougher to get work, while a sharp drop in the dollar's value means money sent home doesn't go as far as it used to.

"It's a double whammy for Mexicans," said Eugenio Aleman, a senior economist at Wells Fargo in Minneapolis.

All this puts extra pressure on an economy that is already cooling.

"Overall, less money from migrants means the economy won't grow as much," Aleman said. Mexico's government sees growth slowing this year to 2.8 percent from 3.2 percent in 2007.

RAIDS, LESS OVERTIME

Remittances are a lifeline for many of Mexico's poorest families, who have incomes of just a few dollars a day, often spent on basic necessities like food and clothes.

In Tonatico, surrounded by farmland some 60 miles southwest of Mexico City, residents say fewer hours on the punch clock and rising U.S. gasoline prices leave their relatives in the United States with less money to send home.

"All their overtime hours have been taken away," says Jonathan Mendoza, whose parents work in a Chicago suburb and send money so he can go to college. He used to receive $135 each week but the amount has dwindled to $50.

"Sometimes I don't pay the rent on time," Mendoza said.

Mexico's government reckons more than 11 million Mexican-born workers are working north of the border in anything from carpentry to health care. A little more than half are there illegally.

The U.S. slowdown has been hard on them, especially at building sites where 152,000 Mexican-born laborers lost their jobs last year as the housing crisis kicked in, according to a study by the Pew Hispanic Center, a Washington think-tank.

Some researchers think Mexico's falling birth rate could also affect the flow of remittances. The average size of Mexican families shrank dramatically in 1970s and 1980s.

"There are fewer young pairs of arms looking for work," said Gustavo Verduzco, who studies remittances at Mexico City's Colegio de Mexico university.

A few young people set out for the border every week from Tonatico, but a decade ago the number was in the dozens, said Trujillo, as he sat at a plastic table swapping stories with friends about running from the U.S. Border Patrol.

Lately, an uptick in immigration raids in the United States and more intense patrolling on the border has also kept people away from work, Tonatico residents say.

"The bosses will say you shouldn't come into work next week because migration authorities could be coming," said Jose Maldonado, a town official who says most of his childhood friends are in the United States.

While migrant labor is controversial in the United States and the government is building a 670-mile border fence to keep foreigners from entering illegally, Mexico largely regards migrants as heroes.

Still, President Felipe Calderon says Mexico needs to create more jobs at home so workers don't have to leave. He is currently trying to convince Congress to pass an oil sector reform which he says would boost economic growth.

"Contrary of what some people think in the United States, we aren't looking to get more remittances sent to us, nor are we betting on it," Calderon said last week.

(Editing by Kieran Murray)

http://news.yahoo.com/s/nm/20080618/us_ ... igrants_dc

Some researchers think Mexico's falling birth rate could also affect the flow of remittances. The average size of Mexican families shrank dramatically in 1970s and 1980s.

That's odd, mexicans living in the US are having babies in record numbers.

By Jay Root and Constanza Morales, McClatchy Newspapers
Wed Jun 11, 3:34 PM ET



UCACUARO, Mexico — More than a decade has passed since Petra Chavolla's children began leaving. Like most kids from this impoverished patch of Michoacan , they followed friends and relatives to Texas , where jobs and a better future awaited.

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But she knew times had changed this past Mother's Day . Instead of the extra cash she almost always received from her children, she got a phone call. Hit by hard economic times, rising gas and food prices, and a dwindling number of jobs for undocumented workers, Chavolla's children in Fort Worth said they couldn't scrape together any extra money this time.

"I could tell they wanted to cry," said Chavolla, 62, fighting back tears herself. "I told them, 'If you can't, well, you just can't.' "

The challenges the Chavollas face tell of a looming financial crisis that reaches across Mexico , where families who depend on money sent from relatives in the United States — called remittances— are opening up lighter envelopes or waiting longer to get them.

Remittances to Mexico hit $23.7 billion in 2006, more than double the amount reported in 2002 and representing the country's second-largest source of foreign income, behind oil.

But after years of double-digit increases, the cash sent back home dropped 2.9 percent in the first quarter of this year. The Bank of Mexico , which tracks the international transfers, predicts that remittances will register a 1.5 percent decline by the end of this year. That would be the first annual decrease since modern recordkeeping began in 1995.

Jesus Cervantes , the director of statistics for the central bank, attributed the drop to reduced migration to the U.S., a crackdown on illegal laborers there and rising unemployment among those in the U.S., where construction jobs— which employ nearly a quarter of Mexican migrants— are in short supply.

Those problems are compounded by what Mexicans living in the United States say is a run-up in prices, led by increases in gasoline.

Graciela Mendoza works in a mattress factory in Fort Worth , making $7.75 an hour. She said she tried to send $300 every other week to her mother and 14-year-old son, but that often she could afford to send only $150 .

Mendoza said the expenses of raising her four children had doubled in the past year while her salary had remained the same.

"These are hard times for everybody, but it is worse for us because we have the responsibility to take care of people that don't have anything else but our money to survive," Mendoza said.

Michoacan , the south-central state where Chavolla lives, receives more remittances than any other Mexican state— more than $500 million in the first three months of this year. But that's down 3 percent, about the national average, compared with the same period last year.

In the town of Zamora, where an Elektra store handles Western Union wire transfers from the States, manager Manuel Basurto said it had gotten so bad that he'd seen families sending cash to struggling relatives in the United States .

"It's only a handful of cases, but in the three years I've been working here, I've never seen that," he said.

He once had 10 people a day coming to pick up money from the U.S., but he said that he now saw about seven on average.

In tiny Ucacuaro , a farming village of some 600 residents about two hours east of Guadalajara , it's next to impossible to find anybody who doesn't rely on money sent from the U.S.

Some of the houses here, built with the proceeds of migrant labor, look as though they've been plucked from an American suburb and dropped onto well-tended yards.

But many are empty, cared for by elderly couples who find themselves with no children left in Mexico . If the kids aren't U.S. residents or citizens, chances are good that they haven't been home in years.

Chavolla, who lives in nearby Maravillas , hasn't seen her youngest son since he went to Texas seven years ago at age 17. Two other brothers left 11 years ago. With no guarantee of getting back across the heavily patrolled U.S. border, they haven't been back since.

It's a similar story at the Ucacuaro home of Salvador and Juana Pulido . All five of the Pulido children live and work in Fort Worth . None has been back home in years.

Martin Valdez , who owns a tortilla shop in Ucacuaro , said he'd seeing a growing number of young Mexicans returning to the village. Some have been deported. Others couldn't find decent jobs in the U.S. Others found the search for work just wasn't worth the hassle.

"Personally, I know 10 people that haven't gone or . . . came back from the States," said Valdez, who graduated from Arlington Heights High School in Fort Worth . "A lot of them prefer to stay here and just tough it out here in Mexico ."

If the number of returnees grows dramatically, that could be a problem for Mexico , said Rodolfo Garcia Zamora , an economist and immigration expert at the Autonomous University of Zacatecas .

"The Mexican economy is not prepared for a massive return of immigrants from the United States ," Garcia said. "The government, on both the state and federal level, has not taken this problem seriously. In terms of social and political stability, it would be extremely delicate."

The remittance slowdown is sending economic shockwaves throughout Ucacuaro and surrounding villages. Salvador and Juana Pulido estimate that remittances from Texas cover half the costs of his small farming operation, now hit with higher prices for feed and fertilizer.

"I couldn't survive doing this without the help from my children," Salvador Pulido said.

Last year, after saving for years, he said, his kids sent him about $37,000 to buy a Case tractor. But in recent months, as their children struggle themselves, the Pulidos have been making fewer trips to the bank.

"Before, they would get together and send us money every month," Juana Pulido said. "Now it's more like every two months."

Valdez said business at his tortilla shop was way down.

"People that were buying three kilos are buying two. The people that were buying two kilos are buying one kilo," Valdez said. "You know, everybody is cutting down."

(Root and Morales report for the Fort Worth Star-Telegram . Morales reported from Fort Worth for this story.)


http://news.yahoo.com/s/mcclatchy/20080 ... hy/2963737

OH NO NOT THE RODEO!

Martin Valdez , who owns a tortilla shop in Ucacuaro , said he'd seeing a growing number of young Mexicans returning to the village. Some have been deported. Others couldn't find decent jobs in the U.S. Others found the search for work just wasn't worth the hassle.

THIS is good news. Those jobs belong to Americans, and thus should never be for people here to gain.

Gogo, about the rodeo, I thought the same thing, BOOHOOO!!!!! Guess living high on the hog off of ill gotten gains from America can only last so long.

So, maybe now Americans can stat affording to live beyon paycheck to paycheck with the illegals starting to give up? We can only hope.

Yeah, the rodeo thing jumped out at me too. There are a lot of thankful animals out there in mex right about now....

Remittances are a lifeline for many of Mexico's poorest families, who have incomes of just a few dollars a day, often spent on basic necessities like food and clothes.

Restaurants would be the LAST place I would spend money at, if my income were a "few dollars a day"!

In rural towns like Tonatico, in central Mexico, where about half the men are in the United States, rodeos and country dances are being canceled and restaurants, which play U.S. hip hop music brought home by returning sons, are languishing.

So what did these families do with the money sent home from their relatives working illegally in the US for decades? Spend it on rodeos, country dances and restaurants? Their houses may be falling down, but they got latest technology? Sucks for them, they should have invested in bettering their lives.

added to the homepage

http://www.alipac.us/article3318.html

Originally Posted by AE

Martin Valdez , who owns a tortilla shop in Ucacuaro , said he'd seeing a growing number of young Mexicans returning to the village. Some have been deported. Others couldn't find decent jobs in the U.S. Others found the search for work just wasn't worth the hassle.

THIS is good news. Those jobs belong to Americans, and thus should never be for people here to gain.

Gogo, about the rodeo, I thought the same thing, BOOHOOO!!!!! Guess living high on the hog off of ill gotten gains from America can only last so long.

So, maybe now Americans can stat affording to live beyon paycheck to paycheck with the illegals starting to give up? We can only hope.

Yes it is good news. Hey when gasoline is $4.60 a gallon here. Food prices are skyrocketing, how do they stay here on the slave wages the employers pay them?

Originally Posted by Gogo

OH NO NOT THE RODEO!

OH YES! BUT WHO GIVES A FAT BABY'S A**. YOU SEE HOW WELL THEY ARE MAKING LIFE FOR THEIR FAMILIES IN MEXICO WHILE WE THE PEOPLE ARE PAYING FOR THEIR MEDICAL CARE,FOOD AND IN SOME CASES THEIR RENT. OUR OWN GOVERNMENT HAS TURNED ITS BACK ON US WHILE THEY ARE PANDERING TO THOSE WHO ARE HERE ILLEGALLY. WOW WHAT A COUNTRY.