The Gilded Cage

THE WORD ON Nogales, Sonora, streets is the once-nationalistic Mexico is resembling the new South Korea. With the maquiladora industry outpacing tourism dollars brought to Nogales and nearly 45 percent of the workforce having maquila ties, it appears everyone is making out just fine.

Maquila execs secure five- and six-digit salaries, while line workers garner two times the Mexican minimum wage. The Casas de Cambio pockets a 1 percent spiff from cashing pay checks after hours. And Ley and EconoMax supermarkets are seeing profits rise thanks to maquila food coupons. Even local suppliers win contracts with the multi-national corporations.

Glossy trade mags sport pages of women with mile-wide hair, shiny lips and business suits, and headlines proclaiming "Maquila Women Climbing the Ladder of Success," or the less sexy "Maquila of the Month."

And while the financial crisis of the peso crash forced 55 Nogales businesses closed last year, the foreign-owned maquilas hired 5,000 new workers. Only two Mexican-owned factories still survive in the border town with a couple dozen workers in each.

The swollen dollar has allowed the maquilas to boom, as the crippling effect of inflation has enticed physicians, psychologists and teachers into second and third shifts inside the faceless monoliths. A continuous supply of applicants from the South streams into the pastel-colored plants tucked discreetly outside the city's tourist district.

Illiterate labor is turned away.

Economic development types north of the border speak of Nogales' role in the global economy, worker career trajectories, and high-tech jobs. They insist the local maquilas are no longer Dickensian.

Yet the industry stonewalls questions about operations. The average quoted turnover rate still hovers at 10 percent in spite of worker bonuses, free healthcare and rides to work.

Ensconced in his hilltop Nogales Chamber of Commerce office north of the border, director Fred Johnson says the press have "burned the maquilas." Arranging a tour might be difficult. As expected, Johnson has a reputation for pushing alarming news off front pages.

For just as Mexico's neoliberal economics have created dependency on swings in the U.S. economy, Nogales, Arizona, has become desperately reliant on maquila workers spending their pay on its north-of-the-border streets.

ON THE PARCHED hills of Nogales, Sonora, live the recipients of the maquila industry's supposed $29-billion-a-year prosperity. In Colonia Los Encinos, a community of some 2,000 makeshift shelters, Yolanda Estrada and her extended family won electricity and intermittent running water after a squatter's sit-in grabbed headlines and then official attention.

The two families share a cramped three-room palette and cardboard house materials "courtesy" of the maquilas. Geranium, spider and ice plants thrive in old paint cans across from the outhouse. A Cabbage Patch doll dries on the clothesline. Estrada's youngest daughter Bobby, finishes washing her long, thick hair with a yard hose over a Johnson Floor Wax drum that's floated off the maquila black market.

Like many agriculture workers 10 years ago, Estrada left a life replanting seeds behind a mule-drawn plow. She would no longer make the early morning trip into the fields to weed cotton, or worry about clothing and feeding her children on sporadic work around the southern Sonoran town of Baco Bampo.

Bobby was five when her 33-year-old mother sold their kerosene gas tank and bought an 11-peso bus trip to the border promised land. She tearfully departed with one dress, leaving the children behind with her mother.

Estrada arrived in Nogales four years after the '82 maquila labor strikes that had all but silenced union activity. She accepted her first job with Jeffel de Mexico assembling transistors for gringos north of the border. Unlike many migrants who slept in tunnels or around the railway station, Vega found a family that took her in with the promise of sharing her first maquila pay check. She ate fried gristle and fat.

One by one, Estrada sent for her children in Southern Sonora. All four have now worked in the maquilas. So has her long-time companion, Elias Islas, who landed higher-paying jobs driving maquila trucks due to his English-speaking ability.

The wiry Estrada flashes a partially capped smile as she gratefully recalls her first maquila job twisting electrical wires with latex-tipped fingers. When her calluses turned raw, she requested another work station and was assigned to inspecting tiny numbers on color-coated wires. As she describes the irritating eye strain, Estrada laughs self consciously.

The 43-year-old Estrada and others her age no longer seek work in the maquilas. Labor activists say that although there are no legal age cutoffs, the industries prefer to hire young and malleable workers. It helps if they're less informed of their rights.

A spokesman for the maquila industry doesn't deny the majority of workers span ages between 18 and 25 years. Although she was legally underage, at 14, Bobby quit school, took a pre-hire dexterity and pregnancy test and went to work at a maquila. Estrada supported her daughter's choice. The cost of uniforms and books was becoming prohibitive and the gang scene was worsening at school. The decision caused friction between Estrada and Islas, who knew from experience that education is a ticket out of minimum-wage work.

Sources say minors frequently falsify their age on maquila applications. The summers clog the maquila job market with schoolchildren from the south trying to earn cash for fall school supplies. One worker says even with a contact, he couldn't find a job during his first summer in Nogales.

Bobby's one-year work history resembles a classic study of the insidious industry burnout. Repetitive tasks, whether sorting coupons, stitching fabric or entering data, wear most workers toward early retirement. Of course, that helps keep the maquila's pension payouts to a minimum.

Bobby punched the clock in four other maquilas before she got her current job as a clothes inspector at the Minsa plant.

The Estrada family lives within walking distance of the Minsa plant. Bobby leaves their hillside home by dawn. She eats the plant's inter-American breakfast of cornflakes, tortas and cheese. It costs one third of her daily income. Lunch, however, is free.

Once social security taxes are stripped from the top, Bobby's nine-hour day of inspecting clothes for blemishes is rewarded with $3--a wage that has dropped since 1983, according to a report distributed by Collectron Maquila Access Services. If she clocks in promptly, there's a $3 bonus.

Given the drudgery of maquila work and the low pay, what are Bobby's maquila job aspirations? The teen answers in Spanish, "Ironing is the best job."

Even though it pays the same as inspecting, she says "it's the most fun."

IT TAKES SIX minimum-wage incomes to run one Nogales household, says Elias Islas, in the excellent English he learned around Mexico City. Proponents of the current maquila wage structure boast that with bonuses, the average entry-level pay ranks two-to-three times the Mexican minimum wage, which is about $3.30 a day.

To survive, the Estradas share meals and their improvised home with Bobby's friends, Ramon, Adelina and their 3-year-old toddler, Paloma. With inflation estimated by the government at 48 percent in the last 18 months, many families cross the border for the lower prices on milk, cheese, rice and beans. Vegetables generally cost less in Mexico.

Adelina recently hired into her first 28-day contract with Minsa. At the end of four weeks, she must iron 311 garments a day or face termination. Such contracts are commonplace in the maquilas. Community activist Teresa Leal says six-month contracts also serve as a legal means of muscling productivity out of line workers.

Adelina has yet to reach her production quota. Her arm and thumb ache. But she says, through a translator, "Some people iron 500 pieces in a day."

Including attendance and production bonuses, and a small food coupon for Ley or EconoMax supermarkets, Adelina takes home $43 a week--less than one dollar an hour.

Supervisors are known to make three times this wage. Executive annual salaries range from $4,500 for nurses to $130,000 for plant general managers, according to In-Bond Central, Inc. But the majority of the maquila force are worker bees.

The maquilas legally skirt the Mexican labor law by offering pay incentives through tax-free food coupons, attendance and production bonuses. Bonuses aren't considered wages, so they can be cut. If a worker is one hour late or misses one day for a sick child, she falls short of the weekly productivity level, and the bonuses are lost.

And as for daycare, only four of some 81 Nogales maquilas offer the service. Even though the government takes a cut of Adelina's pay for social security benefits which include child care, she hasn't been able to book a slot in the crowded federally-funded centers. While working the day shift, she leaves her baby with Estrada, who also earns a bit of a living practicing folk medicine.

"Some people lose half of their (weekly) pay for missing one day," says Leslie Gates, board member of the Coalition for Justice in the Maquiladoras. And if workers function as a team and one person misses time, the entire team loses the bonus.

The so-called company frills are offered to employees because it's illegal to reduce pay for any reason, she says. Yet bonuses can be withheld.

Critics say food vouchers, health services and company warehouse-style housing with accompanying bedtime curfews smack of sharecropping days. But with several plants offering a full menu of medical services, including free dental, medications and an on-site doctor or nurse, many workers laud in-house health programs. Private doctors are too expensive for most workers, and government health department visits can span an entire day.

Since pregnant workers cost the maquilas 12 weeks in social security taxes and maternity leave, family planning has developed into one of the maquila's biggest medical services. Even government workers are pulled into the deal, offering clinic time in the factories.

In other border cities, pregnant maquila workers often are forced into harder tasks to encourage quitting, says LaShawn Jefferson of Human Rights Watch. In some maquilas, quarterly pregnancy tests are routine. But maquilas on the Arizona-Mexico border were not studied by the human rights group, says Jefferson. Tijuana, Ciudad Juarez and Matamoros seem to attract more attention since they maintain up to six times the maquila workforce of Nogales.

Border community activists attack the benevolent facade of maquila healthcare, saying the company-paid physicians may treat employees, but often fail to file reports with the state health department for job-related illnesses. In the April '95 issue of Multinational Monitor, James Shields writes that the maquilas must pay the Mexican government for each work-related illness. But maquila physicians are known to bury paperwork, allowing companies to avoid paying into the system.

According to Mexican labor law, after three consecutive sick days, work-related illnesses are awarded with 100 percent pay. Non-work related ailments garner only 50 percent of a salary. Yet without government notification, workers just plain lose out.

A meager number of non-governmental organizations have time for health and safety issues in Nogales' maquilas. The few grassroots groups taking up the cause are involved in other unrelated community projects. Reactions come in times of calamity.

Just because workers aren't complaining about occupational hazards in the maquilas doesn't mean they don't exist.

According to Gates, with the Coalition for Justice in the Maquiladoras, a planned maquila tour offers little insight into factory conditions. Workers tell local activists they are notified to clean up before Health Department inspections.

As reaffirmed In Chemical Week (June 19, 1996), laxity in enforcing environmental law in Mexico continues to provide a prosperous landscape for foreign investors eager to move south: "While some executives cite Mexico's increasingly stringent environmental regulations, the government's willingness to slap hefty enforcement violations on cash-strapped companies has been questioned. In fact, several sources privately say there is a tacit agreement between officials and the industry that the government, in deference to hard times brought on by the economic crisis, will look the other way if a company is not in compliance."

A spokeswoman for the independent environmental group Proyecto Comadres, says her organization has followed up on numerous health complaints from maquila workers. High blood lead levels were found in some workers in the battery industry--Prestolite de Mexico.

Nogales, Sonora, Chamber of Commerce director Francisco Trujillo says the reporting physician in that case eventually slipped back into silence. "Who knows where those people are?" he says of the original group of workers who complained their gums were turning black. "Maybe some of them have died."

Proyecto Comadres community activist Theresa Leal says she's met an entire line of workers who sew fiberglass materials at Samsonite that have skin lesions from reactions to the airborn fiberglass residues.

"I see women walking around covered with sores," she says. "The doctor at the plant infirmary swabs (the sores) with alcohol to stop the bleeding. They called it mange (and) said it wasn't clean enough at home. Another doctor called it psoriasis."

But lack of documentation limits hard evidence.

Community activists say a large proportion of maquila workers come from rural areas and are unfamiliar with industrial safety concerns. Others "are third-generation maquila workers," says labor activist Albert Morakis. They remember that their parents lost jobs when they protested and realize they have a lot to lose by rallying against the system.

In cities like Nogales, where labor movements have been all but crushed (See accompanying article) and blacklisting isn't uncommon, workers benefit most from learning the labor laws, says Gates. "Rather than organizing for a strike to vote in an independent union," she says, "workers are better off planning low-key actions to bring workplace environments up to legal standards." When such endeavors result in illegal firings, workers can be successful at winning money settlements from companies by taking their case to the state Labor Conciliation and Arbitration Board. "Through smaller actions, solidarity develops among workers, laying the groundwork to pressure factories to implement more ambitious improvements."

Workers interviewed for this article say it's often easier to go along with the system.

Sergio Navarro says something as simple as not wanting to work overtime can elicit an unrequested reassignment that doesn't appear like the demotion it is on paper.

OFF PARQUE INDUSTRIAL in Nogales, Sonora, Marco Valenzuela weathers the monsoon rains from one of the city's best appointed offices. With a laptop at the corner of a tropical hardwood desk and a glass of water near his right hand, the front man for the maquilas doles out guarded comments about the 54 out of 81 maquilas he represents.

Seemingly unfettered by the lights and air-conditioning vacillating with each nearby lightning hit, the affable executive director of the Maquiladora Association of Sonora indicates there will be no photos of the meeting--he'd have to receive permission, and it's touchy, don't you know. In perfect English he unequivocally states the only written information he can supply are a press release and a one-year-old brochure. He offers no maquila tours.

The press release announces that last year the maquilas contributed $186 million to the Nogales economy. The cash represents the usual salary, wage and tax considerations any business in Mexico might provide as an economic boon. Ironically the release includes fees for attorneys, water and environmental professionals as income generated for the city.

The maquilas' nearly decade-long exhibit of community altruism is distilled into a pictorial brochure with a dual mission of selling maquila association members on the charitable, tax-deductible "Nogales Project." A caption asks, "Why Should I Join?" In short, non-participating maquilas risk being invited to participate in the city-run "mandatory charitable programs." The other reason for joining: the "Project improves the image of the Maquila Industry...but more importantly enhances the image of the firm with its employees."

In eight years, participating maquilas boast they've kicked in a whopping $300,000 to community improvements. Nearly 20 percent of that cash went toward constructing a fire substation conveniently located south of the Industrial Park. Of course, maquila workers say they have not seen the likes of the fire trucks in their colonias, where blazes routinely incinerate the wood and paper shacks.

Another tax-deductible $12,000 was plunked down for computers for the Instituto Tecnologico de Nogales, where engineering and business graduates often feed directly into the maquila system. The balance of contributions was spent on 12 remaining projects, ranging from basketball courts, sewer piping, house-building kits, and an elementary school's water cistern.

By appearance, the largest contribution to date went toward the home-building project for maquila workers. Beginning in 1988, "a few generous people from the largest firms in Nogales" assisted in funding the construction of 18 homes. Last year, 200 homes were sponsored. This year, 1,000 starter homes are planned east of the railroad tracks. With a view of San Carlos Industrial Park, the dream homes come with a promise of curbs, dust-proof roads, water and sewer.

Given the $2,000 down payment required to get into one of these places, it stretches conventional thinking to imagine the average line worker benefits from the project.

Valenzuela glosses over this, insisting the computation shows five minimum-wage earners can foot the monthly interest-free payments once the down is settled.

From his modest office across town, Chamber of Commerce director Francisco Trujillo laments the decades that rolled by when the maquilas contributed nothing but pollution and latchkey kids to Nogales. But, he says of the proposed housing for a fraction of the 25,000 maquila workers and their families, "It's never too late."

When the maquilas hit town in the mid-'60s, he says, Nogales was a small hamlet of about 50,000--a good place to live. But now with several hundred thousand more people, municipal services are stretched beyond belief. After the rains, sewage flows down fissured hills propped up with old tires for erosion control. Too many people live without electricity or still buy drinking water from tanker trucks depositing the precious liquid in old chemical drums.

The few taxes required of the maquilas are sent to Mexico City and then are distributed to cities around the country according to a decade-old census, says Trujillo. For Nogales, that means funding for 128,000 people, when the unofficial population is 350,000.

SANTA CRUZ COUNTY economic development promoter Steve Colantuoni insists the Nogales maquilas now epitomize paradise compared to U.S. factories during the industrial revolution. The self-professed Massachusetts liberal says the multinational corporations across the border are the biggest thing going between the two Nogales bordertowns, known historically as twin-plant cities because production used to be shared on both sides.

Colantuoni admits the maquila system isn't perfect. Wages could be higher. "But if (maquila) workers are punctual, they don't have to be (line) operators their entire life," he says.

More industrial-skilled opportunities exist in the Mexican border city than in Nogales, Arizona, he says, where workers must settle for service jobs like taking orders at Yokohoma Rice Bowl.

"I get envious when I go over there, " says Colantuoni, when he speaks of Hasta-Mex, a maquila with a mere 1 percent turnover rate. He describes clusters of young workers dressed in white lab coats learning about the latest mechanical instrument introduced in the plant. Each worker learns every plant job, he says, and with each new job comes a pay increase.

Colantuoni exuberantly rattles off other worker enticements, yet he doesn't mention that "perks" such as vacation, Christmas bonus, double and triple overtime are required by Mexican labor law anyway.

But despite all the bonhomie about career breaks in the Nogales maquilas, Colantuoni says one thing is clear. The natural progress of industrialization will eventually lead to wage increases, just as they doubled in South Korea. Already, wages in the border town are higher than inside the country. Workers refuse to hire on for less, because cost of living is higher on the border than farther south.

Development types north of the border seem to think the lack of telecommunications and microwave hookups in the south will slow down maquila development in Mexico's interior.

Besides, they say, U.S. maquila managers always prefer living on the border so they can live in the states and send their kids to school there.

But maquila exec Marcos Valenzuela says the trend is to hire more Mexican managers into the hierarchy. Undeniably, he says, as the border infrastructure continues to grow in the next five years, more businesses will be moving to the country's interior in pursuit of lower-cost operations.

Valenzuela recently returned from a reconnaissance trip in the south, where the impact of the peso devaluation is so severe that Oaxacan workers will eagerly hire on for the Mexican minimum wage.

And in 2001, economists predict, the maquilas will shift from cost to profit centers. With more Mexican managers running operations and "Made in Mexico" stickers sealed onto newly assembled goods, what really will be more attractive for the multinational corporations--extending career trajectories for border maquila workers, or building low-budget operations in the south?

Editor's note: Maquila workers' names were changed for this story. TW

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