Maquiladoras, Human Rights, and the Impact of Globalization on the US-Mexico Border

Mia Alemán, Editor

Along the U.S.-Mexico border, the maquiladora industry has created unique transnational communities in direct response to retailers’ and governments’ globalizing activities. The industry has reduced retailers’ dependence on the simultaneous development of crucial supporting actors, primarily ocean shipping, increasing the efficiency and timeliness of all aspects of production, distribution, and sales. The concern over costs and time ultimately feeds back to the labor cost in every link in the supply chain.[1] One of the primary reasons the Mexican government established the maquiladora industry and made contracts with foreign suppliers was so retailers could escape the high cost of American and European labor, thus incentivizing Mexican industry. However, despite the benefits for foreign retailers and Mexican maquilas, working conditions and wages are strongly affected by retailer practices and the exploitation of loosely enforced regulations. Together, the impact of poor working conditions and external pressure on workers highlights human rights concerns throughout the maquila industry and reveals the actual cost of such a unique form of global logistics.

  A maquiladora, or maquila, is a factory or manufacturing plant in Mexico owned by a foreign entity. The Spanish term ‘maquiladora’ refers to millers charging a maquila, a miller’s portion, for processing grain. In 1965 the Border Industrialization Program (BIP) ushered in a new era for development in Mexico, encouraging foreign investment. The same year, Mexico’s Secretary of Industry and Commerce, in conjunction with the Secretary of Finance and Public Credit, issued a set of guidelines further specifying the terms under which the BIP was to operate.[2] Raw materials, components, and the capital equipment used to process them could be imported into Mexico duty-free to be assembled and subsequently re-exported as finished products if they remained in-bond while in Mexico. The establishment of this framework of operation marks the birth or creation of the maquila industry, with the term “in-bond industry” used as its official designation. The maquila industries may also hire technicians and other foreign personnel required to manage and maintain the plants. However, these operations would only be allowed within a 12.5-mile strip along Mexico’s northern border with the U.S. and were limited to PRONAF administered industrial parks.[3] Over 3,000 maquiladoras exist along the 2,000 mile-long United States–Mexico border, providing employment for approximately one million workers and importing more than $51 billion in supplies into Mexico.[4]

Mexican labor must remain cheap and competitive with other major export countries to attract foreign investment. To keep production costs low, maquila workers suffer the consequences as middleman minorities, operating under harsh work environments with low wages, forced overtime, and illegal working conditions for minors. While Mexico has an advanced system of labor laws, enforcement in the maquiladora industry is lacking. Most maquiladora employees are women, who typically work for cheaper wages and make it easier for male employers to impose poor working conditions.[5] Some employers even admit a preference for women who are more ‘patient’ and ‘dexterous’ while performing the highly standardized and repetitive work on an assembly line. However, once hired, women workers routinely suffer a unique form of discrimination: the maquiladoras require pregnancy testing as a condition of employment and deny work to pregnant women. If a woman becomes pregnant soon after gaining employment she may be mistreated or forced to resign.[6] Based on these conditions, the maquila industry has been repeatedly accused of sexual exploitation of women.

Maquiladoras operate in enclosed facilities with a large workforce, and the impact of these conditions on workers is often significant. During the global pandemic, the leading human rights abuses in the maquiladora industry include massive job losses, extensive wage reductions, unsanitary working conditions, and consequent deaths from the virus. The rise in disease transmission in the border region has been attributed to maquilas claiming to suspend operations for three or four days while remaining active without proper health measures. Even more concerning are the accusations against large corporations who have been illegally incentivizing a return to work during the pandemic, including Foxconn, who offered to double the wages of staff willing to work during quarantine.[7] Maquiladora industry representatives in the city of Juárez have even created a group called Task Force, encouraging staff in the maquilas to return to work for economic recovery in spite of the health risk, which has the potential to  become more damaging than the coronavirus itself.[8] The combination of local incentives and international pressures for production led to the vaccination efforts for maquila workers in South Texas, but in reality this is another example of the longstanding abuse of workers in the industry.

  While advantageous in the newfound expansive global economy, the existence of maquiladoras questions the role of human rights in the economy. The large foreign corporations could lift their maquila employees out of poverty, yet they have not even begun enforcing the most basic standards amongst their maquilas. When companies make profits at any cost, they end up with impoverished and unhappy populations, resulting in continued violence and unrest. Inhumane working conditions are not only human rights abuses, but it is also bad business practice. The future of the global market must include a system that rewards ethical behavior and punishes unethical behavior. However, for this future to become a reality, consumers must demonstrate that a guarantee of workers’ rights is vital, and they will pay for better practices. Workers in maquilas and beyond have labor rights and the right not to be exploited; therefore, worldwide standards upholding accountability, reporting, and transparency are necessary for the future of globalization.

Works Cited

[1] Bonacich, Edna, and Gary G. Hamilton. “Global Logistics, Global Labor.”

[2] Hansen, Lawrence Douglas. “The Origins of the Maquila Industry in Mexico.” Comercio Exterior 53, no. 11 (November 2003). Pg. 10.

[3] Hansen, Lawrence Douglas. “The Origins of the Maquila Industry in Mexico.” Pg. 10.

[4] Richards, Howard. Understanding the Global Economy. Santa Barbara, CA: Peace Education Books, 2004. Pg. 333.

[5] Richards, Howard. Understanding the Global Economy. Santa Barbara, CA: Peace Education Books, 2004. Pg. 333.

[6] “Sex Discrimination in Mexico’s Maquiladora Sector.” Human Rights Watch. Human Rights Watch, August 1996. https://www.hrw.org/legacy/summaries/s.mexico968.html. 

[7] López, María Encarnación. “The Lives of Mexico’s Maquiladora Workers Are Being Put at Risk by Lax Covid-19 Rules and the Demands of International Trade.” LSE Latin America and Caribbean blog, August 19, 2020. https://blogs.lse.ac.uk/latamcaribbean/2020/05/25/the-lives-of-mexicos-maquiladora-workers-are-being-put-at-risk-by-lax-covid-19-rules-and-the-demands-of-international-trade/.

[8] López, María Encarnación. “The Lives of Mexico’s Maquiladora Workers Are Being Put at

Risk by Lax Covid-19 Rules and the Demands of International Trade.”

[Image Credit: Andy Wallis, CC BY-NC-SA 2.0]