The suspension of economic activities in United States that caused the covid-19 pandemic in early 2020 led to a severe contraction in employment of immigrant mexican workers. From December 2019 to April 2020 said employment —measured with seasonally adjusted data— was reduced by 1 million 225,326 jobs, although as of May 2020 it began to recover and by December 2021 it reached 7 million 039,031 people, already exceeding its level at the end of 2019 of 6 million 966,203 workers, that is, before the Covid-19 pandemic.
Analysis of the salary mass of Mexican immigrants
Such an evolution of employment in the United States had as a counterpart a similar behavior of the salary mass obtained by the immigrant mexican workers. Thus, from January 2020 to April of the same year, said monthly salary mass was reduced by 5,820 million dollars, with decreases of 3,499 million for male workers and 2,321 million for women. As of May 2020, as the employment of immigrant Mexican workers began to recover, so did their wage bill, albeit with ups and downs, and in December 2021 it reached an unprecedented monthly amount of 25.73 billion dollars, of which 6,902 million were obtained by women, 26.8% of the total.
In 2020, the annual wage bill of Mexican immigrant workers in the United States totaled 256.876 million dollars, which implied a reversal of the upward trend that had begun in 2012. However, the job recovery of these workers and the increase in their average remuneration meant that in 2021 this wage mass reached 282,820 million dollars, with 79,460 million obtained by women (28.1% of the total).
Wage bill and remittances from Mexicans
In the last two years, the upward trend that began in 2016 in the percentage of the wage bill obtained by Mexican immigrant workers that is sent to Mexico as remittances has been accentuated. In 2020 and 2021, Mexico’s income per remittances from the United States resulted in 38,765 and 48,959 million dollars, respectively, amounts that in relation to the wage bill of Mexican immigrant workers were equivalent to 15.1% and 17.3%, respectively. That ratio was 16.6% in the first half of 2021 and rose to 17.9% in the second half of the year.
It must be recognized that the Mexico’s income from remittances was also favored by financial supports granted by the US government to individuals and households in that country, including immigrants of Mexican origin.
A part of these resources financed the sending of remittances. Surely in 2020 and 2021, there was a significant number of Mexican migrants who sent higher percentages of their labor income than those mentioned above, but this was offset by others who sent lower percentages and by those who did not send.
It is convenient to dimension the salary mass obtained in the United States by Mexican immigrant workers when comparing it with some indicators of Mexico. In 2021, this annual salary mass of 282.820 million dollars was equivalent to 179% of that obtained by the total number of workers insured in the IMSS (158.078 million dollars), with percentages of 200% in the case of men and 141 % for women. Likewise, the aforementioned salary mass was equivalent to 21.9 percentage points of the Mexico GDP.
Solidarity through remittances
The significant increase in the percentage of labor income sent as remittances by the group of Mexican migrants reflects their fundamental aspect, which is to help compensate for the disadvantaged income situation of their relatives in Mexico. It is an action of solidarity of immigrants with their relatives affected by the crisis in Mexico. This disadvantage worsened in 2020 and 2021 if one considers that in Mexico in 2020 the drop in economic activity and household income was very severe and the recovery in 2021 did not compensate for the contraction of the previous year. In this way, the gap between the mexican economy and the North American and among its products per capita continued to expand.
*Jesús A. Cervantes is a member of the Economic Studies Committee of the IMEF and director of Economic Statistics at the Center for Latin American Monetary Studies (CEMLA). Rodolfo Ostolaza is a senior economist at CEMLA.
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