Mexico hourly wages now lower than China's by 1/5

[HiPointDem]

Mexico's hourly wages are about a fifth lower than China's, a huge turnaround from just 10 years ago when they were nearly three times higher, according to new research by Bank of America Merrill Lynch.

Stagnant salaries in Mexico, fueled by strong population growth, will give Latin America's second-biggest economy an edge over China in the U.S. market, Bank of America Merrill Lynch economist Carlos Capistran said on Thursday. Average hourly wages are now 19.6 percent lower in Mexico than China whereas in 2003 they were 188 percent more costly, according to the Bank of America study.

Mexico can maintain that competitive advantage (sic) for at least five years, thanks to a growing labor market that puts downward pressure on wages, Capistran said.

The demographic bonus from its young population will help boost Mexican growth to 4 percent this year, he added, and is even more important to juicing the economy than a raft of reforms proposed by centrist President Enrique Pena Nieto, who took office in December.

Mexico's wages as a proportion of economic output are lower than those in Indonesia, the Philippines, Thailand, South Korea, Hungary, Poland and Brazil, where labor costs have risen dramatically.

http://www.reuters.com/article/2013/04/04/economy-mexico-wages-idUSL2N0CR1TY20130404

oh frabjuous day

[Kolesar]

1. NAFTA put a million Mexican maize farmers out of a job

It may have been millions. They could not compete with subsidized American agribusiness prices .

[fasttense]

2. That is stunning.

The poverty in Mexico must be out of control horrible.

Spiraling downward salaries while corporations are making more "profit" than ever before. Do you see the correlation?

Capitalism requires ever lowering wages so capitalist get to keep ever increasing portions of other people's hard work. While lowering your wage and the entire county of Mexico's wages, CEO and boards of directors give themselves vast pay increases and bonuses. While destroying entire nation's economic progress, corporation reap huge profits. They have no right to that profit. It is the worker, who works for so much less than the value of their labor, who allows those corporations to be successful.

Workers need to kick out CEOs and boards of directors and put themselves in charge of the things they make, put themselves in charge of corporations. Capitalism is not working. It is broken and devouring itself.

[FreakinDJ]

3. Free Trade Race to the Bottom - "Enjoy the Ride Suckers"

[bahrbearian]

4. Coming soon to America.

[gejohnston]

5. pull out of NAFA and GATT

now, and tell the WTO to go fuck themselves.

[treestar]

6. So then shouldn't outsourcers relocate

By their logic, lower wages and savings on transportation costs. China is far away. Amazes me it was cheaper to transport widgets that were very cheap so far rather than use American labor.

[HiPointDem]

11. so why aren't they?

[treestar]

15. Maybe they will

or the treaties and some such affect things.

I would think it would be an improvement - fewer undocumented aliens as our jobs are shipped from China, but Mexico being nearby, we could in theory get some back.

[dawg]

7. Eventually, pay rates will more or less equalize.

Even for Americans.

It is an economic eventuality.

Some say we need to embrace it and get used to having a greatly reduced standard of living for most working class people.

Others say we need to redistribute a portion of the gains made by the wealthy from globalization so as to soften the blow to ordinary families.

This is *the* issue of our times. Everything else is just a distraction.

[HiPointDem]

12. nope, they won't.

[dawg]

14. What's gonna stop them?

Democrats?

[Blue_Tires]

8. So? Mexican citizens make up the difference with the guns and drug trade

[xchrom]

9. Du rec. Nt

[Brickbat]

10. "Give an edge," "more costly," "competitive advantage," "demographic bonus," "juicing the economy."

Fuck the bullshit.

[Yavin4]

13. Yet Another Strong Global Deflation Signal

The global labor force is getting poorer and poorer and that is killing demand. The Fed can only sustain prices for so long until they fall through the floor. What is desperately needed is fiscal action. Money needs to be put into the hands of the people to spend.

[NightWatcher]

16. How long before plastic Mexican crap replaces Chinese crap in Wally World?

In the race to the bottom, we all lose.