Impacts of USMCA on Labor
NAFTA was based on safety as well as more open access in the three nations. In the last twenty-five years, NAFTA has been used not only to cut tariffs between the three nations but also assisted in dealing with issues such as labor, border issues, environmental issues, manufacturing among other aspects. Generally, consumers in the three nations were supposed to enjoy the benefits of the agreement through a more effective and efficient distribution of resources. Over the years, NAFTA has tremendously reduced prices of consumers goods and particularly food products. Further, NAFTA has also seen a significant reduction in the prices of oil across the United States. USMCA changes NAFTA in several ways. Moreover, change is inevitable and a lot had changed in the last twenty-five years that needed to be depicted in the trade agreement for the benefit of not only the united states but also Mexico and Canada.
Labor is one of the core areas that USMCA significantly changed. This essay will look at the diverse ways that labor terms were improved under USMCA and its impact on different industries such as manufacturing and agriculture. Further, the essay will also discuss the impacts of NAFTA on immigration and how USMCA has sought to solve the problem. Many people from Michigan, Texas, California and other states where manufacturing was concentrated lost their jobs. Although there were, some jobs that were created around the borders this could not be compared to the losses that many people in the manufacturing industry who were rendered jobless. However, USMCA seems to have changed that and now many manufacturing jobs will be returning to the United States one's again.
Under the new policy more of a vehicle's value will be manufactured in the united states or Mexico for the car to be tariff-free. This policy increases the threshold from the previous NAFTA of 62. The steel, manufacturing, glass and plastics industries will require more people working in their manufacturing plants as well as in the production and mining of the minerals thus creating more jobs for Americans and Mexicans. Conversely, NAFTA had strengthened the ability of United States employers to force workers to accept lower wages and benefits. Immediately after NAFTA became law many corporate managers took advantage of the new law and started threatening their employees that their companies were intending to move production to Mexico where the cost of production was cheaper unless the employees were willing to accept lower wages and benefits to lower the companies cost of labor.
Hakobyan & McLaren, (2016), claim that these threats by many employers tremendously weakened the bargaining power of many workers in the United States. Many companies used similar threats to ensure that many of their employees did not participate in labor unions. Although many manufacturing jobs were shifted to Mexico that came to with its challenges to the people of Mexico. The Mexican workers were exploited under NAFTA as they were forced to work in for low wages. Further, in Mexico, union representation is very little and this contributes massively to the exploitation of poor workers who have to work for long hours. Gonzalez, (2017) alleges, the workers could sometimes work for over 12 hours and most of the time would not be paid for overtime.
The employees would be forced to work for long hours cheaply assembling products, which would be exported, back to the United States. According to one report, women in Mexico are sometimes mandated to take pregnancy tests before getting employed (Gonzalez, 2017). Under the new policy, the three countries have the right to sanction each other on labor violations. Agriculture Agricultural development is one of the core principles of UMSCA. The new deal protects the rights of farmers in the three nations. Conversely, USMCA has not only increased job opportunities in the automobile manufacturing industry but also in the agriculture industry. 2% one of the lowest in the region. In a period when Latin America has experienced exponential expansion the growth rate of Mexico after NAFTA remains similar in the last two decades as unemployment has increased in Mexico regardless of the country exporting a lot of agricultural products to the united states.
Thus NAFTA is one of the primary causes of unemployment in Mexico. According to some researchers instead of satisfying, its promise of providing Mexicans with cheaper food NAFTA actually increased Mexico's dependency on food imports. Mexico was left unprotected from volatility in international food prices as well as exchange rates. Although not straightforward USMCA has the ability to impact Mexican workers positively by improving their working conditions. The new deal requires Mexico to abolish child labor this would translate into more jobs for the jobless adults in the nation. Furthermore, the new deal proposes that people working in the automobile industry should be paid at least $16 an hour (Lobosco, 2018). When this change is effected employers in other sectors of production will be forced to improve working conditions for Mexican workers.
This includes agriculture. The disparaging effect on Mexican agricultural and small-scale businesses caused by NAFTA has over the years led to the dislocation of millions of Mexican workers and farmers with their families. Many of the Mexican workers who have been rendered jobless have been trying to cross the border looking for jobs in the United States illegally. This has led to an increase in the number of undocumented immigrants in the nation. This results in more pressure on the United States wages mainly in the already lower wage market for less skilled individuals. On the other hand, the deal laid a foundation for many other trade agreements between different nations. " USMCA wants to protect the American workers and other workers in the three states from exploitation from other nations such as the China.
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