Fri, Aug 01, 2008 - Page 7 News List

Mexico hurting as US migrants send less money home


The names of Mexican hometowns, possibly written by migrants waiting to cross into the US, are seen in a portion of the border wall separating Mexico from the US in the city of Tijuana on Feb. 19.


Mexicans working in other countries are sending less money home, threatening businesses, stalling construction and choking cash flow to hamlets where as much as half the population works in the US.

Analysts said stepped-up immigration raids and the slowdown in the US economy accounted for the drop in the payments, which many migrants use to sustain families back home.

The payments, or remittances, have fallen about 2 percent this year to US$11.6 billion, the first such drop in more than a decade since reliable records have been kept, Mexico’s Central Bank said on Wednesday.

And the buying power of this money has been battered by the weakening US dollar, which has lost about 8 percent of its value against the Mexican peso so far this year.

In Mexico, businesses that once thrived selling everything from beds to bricks to the families of migrants have laid off workers. In this town of verdant fields beneath the snow-clad slopes of the Iztaccihuatl volcano, there’s little left to rely on but small farms.

“There’s no money anymore,” Carlos Escalona said of his family’s business, which sells concrete blocks and bricks to help people build houses with the money migrants send home.

Sales have fallen by a third, forcing the business to lay off 70 percent of the staff.

Of migrant workers in the US, Escalona said, “They lose their jobs, and then they’re afraid to leave the house. It’s like they’re trapped.”

Bank of Mexico President Guillermo Ortiz said about 22 percent of Mexican workers in the US have jobs in construction, an industry that has slowed sharply.

About 152,000 Mexican immigrant workers lost US construction jobs last year, while overall unemployment for Mexican immigrants in the US rose from 5.5 percent to 8.4 percent over the year, a June report by the Pew Research Center said.

Gone are the days when migrants came back to Mexico each year flush with cash, then returned to jobs waiting in the US, as they did during the boom years of 2002 to 2006. Now, more migrants rounded up by US immigration officials are being sent home penniless. Others are returning for good, bringing as many household items as they can along with them and eliminating the need to buy much locally.

In Atotonilco, much of the business at Olivia Guzman’s hardware store used to come around Christmas, when returning migrants would buy electric cables and circuit breakers to power up new appliances for their families in Mexico before returning to jobs up north.

Now that business has mostly dried up. Where she once sold US$30 or so per day, she now sells as little as US$6, she said. Her business survives only because her father owns the building and doesn’t charge her rent, she said.

In small towns, about one in eight families gets money from workers abroad, the government estimates.

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