Cheap Labor
Maquilas and the search for cheap labor in a globalized economy

by Lou Schoen

Over the past several years, The Episcopal Peace and Justice Network for Global Concerns (EPJN) has been studying the social and economic impact of the maquiladora industry in Mexico and Central America with the aim of educating ourselves and the church about the issues involved. Maquilas are factories where workers make products for huge foreign-owned firms. They use parts or materials made elsewhere -- often in the U.S.

As our work progressed -- in addition to visiting maquilas, their workers, labor organizers and church and community leaders in Mexico, Honduras and El Salvador, EPJN members toured chicken farms in Delaware and Maryland and met with living-wage activists in Los Angeles (see TW 1/2 2000) -- we soon became aware that the subject was broader than the North American Free Trade Agreement (NAFTA) and the relationship of the U.S. to its southern neighbors. Today's interconnected, interactive, mutually reinforcing global economic reality encompasses maquiladoras, minimum-wage policies, legal and illegal immigration, racism and xenophobia. Our site visits to Mexico and Honduras convey something of the range of issues and challenges we encountered.

Matamoros

Matamoros, Tamaulipas, lies across the Mexican border from Brownsville, Tex. Here our delegation witnessed young children scavenging the smoking solid waste dump for recyclable trash to sell and for building materials to strengthen the shacks in which their family lives. We were shocked by the scene, repelled by the toxic stench.

This family at the dump had been attracted to Matamoros -- as have hundreds of thousands more to other communities lying northwestward along the 1,951-mile U.S./Mexico border -- by the mushrooming maquilas. Jobs near the border comprise a powerful magnet for families whose traditional livelihood, dependent on farming or fishing, has been undermined or destroyed. Hog, cattle, poultry, fruit, vegetable, fishing, textile and timber industries in this globalized economy increasingly seek vertical integration to control and minimize costs of supply, processing and packaging. Producers favor mechanizing production and keeping the various components in close proximity -- unless they can find labor that is cheap enough to offset the costs of equipment and/or transportation. Maquilas provide such a labor force. Here workers often earn less for an entire day's work than a U.S. minimum-wage employee makes in an hour, an amount far less than a sustainable income. The widespread fear is that if they try to force an increase in these wages, or if the maquilas are required to improve working conditions or limit pollution, the companies owning the plants or using their products will take their business to Asia.

The mass migration from rural areas to the border has overwhelmed public services in 14 pairs of cities across the U.S./Mexico border. On the Mexican side, the newly arrived migrants' hope for a productive new life is quickly replaced by despair as they take up life in squatter settlements and compete for jobs that are restricted mostly to women between 18 and 30, whom managers regard as more compliant and as having greater finger dexterity. Many soon see brighter prospects across the border in El Norte. High proportions of workers in food-related and other industries throughout the U.S., in fact, are recent immigrants, many of dubious status under U.S. immigration laws. Some, from points as distant as the Balkans, South America or East Asia, as well as from Latin America, have paid huge fees or deposits to labor brokers to help them get green cards certifying legal residence. This process takes years, however, for the U.S. Immigration and Naturalization Service (INS) has an enormous backlog of requests. Many are readily sold on the alleged ease of bypassing this tedious system by hiring smugglers to deliver them to a workplace.

Smugglers have been known, however, to abandon illegal migrants in remote places after taking their money -- often with fatal results. Bodies are regularly found in the mountains and deserts of the southwest, as well as in the Caribbean and in holds of ships bound from China. One smuggler was convicted in Texas of taking the cash and killing his client.

The INS has an aggressive catch-and-deport program, increasingly well-funded by the current Congress. Its detention centers are usually filled to capacity and, like one which EPJN visited near Harlingen, Tex., expanding rapidly. Children are separated from their families during detention, and placed in nearby foster homes where their language may or may not be spoken.

San Pedro Sula

We sat in a circle of chairs at the edge of the nave in the Episcopal Cathedral at San Pedro Sula in Honduras. A nervous reserve characterized the five young Hondurans assembled by their pastor from a nearby suburb to describe to us their maquila work experiences. Their anxiety was transparent as the tales unfolded. Although conditions were variable, they complained of high pressure, verbal abuse from supervisors, physically harmful job environment, sexual harassment, highly variable supervisory behavior, intense performance pressures including mandatory overtime (with overtime pay a constant source of dispute), lack of support for education or career growth, inadequate medical care, dismissals during pregnancy, and lack of public enforcement of legal labor standards. When one of the workers complained to a supervisor, he was told, "There are lots of others outside the gate who want your job."

Another summarized: "They want you to give up your life while you're young."

Our pastor-host admitted that she feared speaking out about such injustices lest she impair her son's work opportunities. "We could have the whole country here, giving witness," another of the workers said, "but they're afraid of losing their jobs."

But labor leaders continue to work for change. Our delegation was able to meet with more than 30 plant organizers, eager to present a similar list of complaints.

"This is the first time a group of North Americans has come to listen to us," they exclaimed, pleading for international support.

Collective bargaining, however, while making progress, is doing so slowly. Labor federations are in place (sometimes competing for members, as unions often did in their early development in the U.S.). With few exceptions, mainly in Mexico, most bargaining agendas are limited to working conditions and have not yet gained wage contracts. An official union, sanctioned by the Mexican government, is widely seen as a tool of management, not truly representing workers -- although they have to pay it dues. Strikes have had mixed success. Local union and activist leaders and workers acknowledge the need for the jobs maquiladoras provide.

Promising signs: the Gap and the churches

In an attempt to answer charges of poor working conditions, former U.S. Labor Secretary Robert Reich initiated a code of conduct in collaboration with the apparel industry, which dominates maquilas in Central America. It calls for an independent monitoring process, but this is most often controlled by manufacturers, using public relations and accounting firms. Recently, however, the Gap, a major customer of apparel-making maquilas, has stepped outside the industry norm. It is working with independent monitoring groups in Honduras and El Salvador, the majority of whose members are representatives from local non-governmental organizations including churches and human rights groups. The Episcopal Diocese of Honduras employs the monitor there. Initial results in both countries are limited, but look promising.

Numerous churches continue to engage the power structure in Central America. Leo Frade, the Bishop of Honduras, is facing down regional officials to build a housing development for victims of Hurricane Mitch. Medardo Gomez, the bishop of the Salvadoran Lutheran Synod, supports a human rights ministry and was a leader organizing an international pilgrimage to mark the 20th anniversary of Archbishop Romero's assassination on March 24.

The bitter byproducts of economic globalization tend to be hidden from the investors who profit handsomely and from consumers who save money at the expense of millions of families living on the edge or dropping over. Global trade policies will support this process until international institutions advancing labor and environmental agendas are empowered to balance the business trading agenda.

Leading activist groups for justice in this new environment include the American Friends Service Committee, the National Labor Campaign, Global Exchange, the Fair Trade Certified Coffee Campaign, and others. Many groups collaborate in the Coalition for Justice in the Maquiladoras, which focuses on the Mexican context, and Sweatshop Watch, which also follows experience in Central America and elsewhere. The Interfaith Center for Corporate Responsibility is a point group for faith communities seeking leverage against corporations and public policy. Each group is accessible on the world wide web.

Lou Schoen is a Minneapolis consultant and writer who represents Province VI in the Episcopal Peace and Justice Network for Global Concerns, one of the networks associated with the Episcopal Church's Peace and Justice Ministries office, <LOUSCHOEN@aol.com>. Photographer Dick Kerner, the convener of EPJN, lives in Dallas, Tex. EPJN is preparing to a detailed report on its maquiladora study and multi-media resources for church-based study groups that will be available from the national church.