Export Assembly Plants for the United States

Maquiladoras in Mexico

Export Assembly Plants for the United States

By Matt Rosenberg

Geography Expert

There are over one million Mexicans working in over 3,000 maquiladora manufacturing or export assembly plants in northern Mexico, producing parts and products for the United States. Mexican labor is inexpensive and courtesy of NAFTA (the North American Free Trade Agreement), taxes and custom fees are almost nonexistent, which benefit the profits of corporations. Most of these maquiladora lie within a short drive of the U.S.-Mexico border.

Maquiladoras are owned by U.S., Japanese, and European countries and some could be considered "sweatshops" composed of young women working for as little as 50 cents an hour, for up to ten hours a day, six days a week. However, in recent years, NAFTA has started to pay off somewhat - some maquiladoras are improving conditions for their workers, along with wages. Some skilled workers in garment maquiladoras are paid as much as $1-$2 an hour and work in modern, air-conditioned facilities.

Unfortunately, the cost of living in border towns is often 30% higher than in southern Mexico and many of the maquiladora women (many of whom are single) are forced to live in shantytowns that lack electricity and water surrounding the factory cities. Maquiladoras are quite prevalent in Mexican cities such as Tijuana, Ciudad Juarez, and Matamoros that lie directly across the border from the interstate highway-connected U.S. cities of San Diego (California), El Paso (Texas), and Brownsville (Texas), respectively.

Maquiladoras originated in Mexico in the 1960s along the U.S. border. In the early to mid-1990s, there were approximately 2,000 maquiladoras with 500,000 workers. In just a few years, the number of plants has almost doubled and the number of workers has more than doubled. Maquiladoras primarily produce electronic equipment, clothing, plastics, furniture, appliances, and auto parts and today eighty percent of the good produced in Mexico are shipped to the United States. Ninety percent of the goods produced at maquiladoras are shipped north to the United States.

While some of the companies that own the maquiladoras have been increasing their workers' standards, most employees work without even knowledge of unions (a single official government union is the only one allowed) and some work up to 75 hours a week. Some maquiladoras are responsible for significant industrial pollution and environmental damage to the northern Mexico region.

Competition from China has weakened the allure of maquiladoras in recent years and some report that more than 500 plants have closed since the beginning of the decade, causing a loss of several hundred thousand jobs. China is bolstering its status as the world's cheap assembly export location.