NAFTA

When Ross Perot ran for president in 1992 he said that NAFTA would create a giant sucking sound of jobs moving to Mexico and it appears that he was on target. During the more than two decades under the North American Free Trade Agreement (NAFTA, entered into by the United States, Canada, and Mexico), Mexico’s light vehicle production more than tripled—from 1.1 million units in 1994 to nearly 3.5 million units in 2016. Moreover, Mexico’s light vehicle exports increased from 579,000 to 2.8 million units during the same period. These are cars that would have been made in the US and hurt the middle income people in manufacturing jobs. During this same period NAFTA's implementation has coincided with a 30% drop in manufacturing employment, from 17.7 million jobs at the end of 1993 to 12.3 million at the end of 2016.  Profits for US auto makers have increased do to lower cost production of cars in Mexico. While the average manufacturing wage in the United States is nearly $21 per hour, the average manufacturing wage in Mexico is just over $2 per hour, an historic low. This does not include the cost higher benefits paid in the USA, things like health care and pensions.