Capitalism grows in Mexican desert

JUAREZ, Mexico

Just a year ago, this was wild, open desert, featuring nothing more than scattered shrubs and occasional funnel clouds that kick up blinding dust storms.

Now, a $100 million factory rises from black asphalt, a young tree planted near its entrance. The Electrolux plant has done many things: It has taken away jobs from Greenville, Mich., where Electrolux closed a plant before moving here. The plant and other factories have transformed Juarez and the Chihuahua desert into a bustling crucible of capitalism, and changed the lives of many Mexicans.

Andres Lozano, 27, was hired at Electrolux in December as employee No. 2319. The plant employs slightly more than the Michigan operation and promises to be twice as large.

Based on an exchange rate of about 11.5 pesos to the dollar, workers in Juarez earn in a day what workers in Greenville made in an hour or less. For corporate numbers crunchers, the math was easy.

Mr. Lozano supports his wife, Alma, who does not work outside the home, and two children, Iban, 4, and Evelyn, 6 months. His pay, which has risen quickly to 100 pesos a day, is enough to support the entire family.

In his old job as a meat wholesaler, he made about the same amount of money but worked twice as long, usually 12 hours a day, seven days a week. He sold and delivered processed meats, mostly to large grocery chains, working on commission.

Because he works less now, he has fewer problems at home. He has time to shop, see friends, go to the movies and to flea markets, make repairs around the house. He is a man more at ease, his posture relaxed, with a smile that comes more easily.

With his salary, and with help from a government loan program, he was able to buy a two-bedroom home for about $20,000.

“My kids will have what I didn’t have,” he said. “They’ll have more of everything. They’ll go out more. They’ll have more things.

“I had the chance to go to college, but I had to work. I want my kids to go to college. I don’t want them to be [machine] operators.”

Industrial boom

Electrolux and the other factories, known as maquiladoras, are a magnet for workers. Since 1990, the population of Juarez has grown from about 800,000 to 1.3 million, and about a third of its residents came from outside Chihuahua state, where it is located.

With a growth rate that is almost three times the Mexican average, Juarez is now Mexico’s fourth-largest city, growing much faster than El Paso across the bridge in Texas.

There is no sign the growth will end soon. Juarez is bounded to the north and east by the U.S. border, and blocked to the west by mountains. But the south, where Electrolux built its plant, presents no barriers and land is plentiful. It is expected that Electrolux suppliers of foam, plastic and electrical parts will build plants nearby.

Story Continues →