A silent integration: North American labor market undergoes significant change.

Since the arrival of the North American Free Trade Agreement (Nafta) in 1994, we have seen a substantial increase of trade between the United States and Mexico. However, the public, the media and political actors in both countries continue to debate whether Nafta has been a critical factor in this growth. In the meantime, while the rest of North America argues about Nafta's successes and shortcomings, a quiet, consistent, and potentially equally relevant process has been taking place: the integration of a binational labor market.

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In the last 10 years, an amazing number of Mexican nationals have moved and settled in the United States. According to the U.S. Census Bureau 2000 Report, 10 million Mexican citizens have changed their residence to the United States. The Mexican-American community makes up by far the biggest ethnic majority in the United States. Some key data helps us grasp the importance of the Mexican-American community today and the potential they project in the near future: (1)

* Hispanics are the largest minority in the United States with a population of 38.8 million (between 50 to 60 percent Mexican nationals or Mexican-American).

* There are more than 1.2 million Hispanic-owned businesses that generate more than US$200 billion a year and employ more than 1.3 million people.

* 28 percent of Hispanic-owned firms are owned by women.

* Hispanics have a purchasing power of about US$540 billion.

In addition to these permanent settlers, more than 400,000 Mexican workers are employed in the United States for temporary periods of time. (2) Mexican migrants are now present in practically all of the states in the United States and, although they are still heavily concentrated in California, Texas, Arizona and Illinois, there are other U.S. states and regions experiencing a rapidly increasing Mexican population.

Even though a substantial part of this massive movement of people takes place in an unlawful way, the number of U.S. visas issued to Mexican nationals is among the largest in the world. The numbers on the following page represent the business and working visas that were issued to Mexican citizens during the fiscal year 2003. (3)

The Mexico-U.S. border is considered the busiest border in the world. More than 350 million crossings take place each year through 23 ports of entry. (4) In this region, a region, a real, intense and vibrant binational economy works along its numerous twin cities. Thousands of Mexican and U.S. citizens commute daily and work on each side of the border.

The increase in international trade and competition has resulted in the need for businesses to have a presence throughout North America. Office work, manufacturing, sales efforts, business meetings, training programs and implementation of after-sales service contracts--all of these activities and more are taking place on both sides of the border now more than ever.

In the global economy in which we live, where there is fierce competition between all countries in the world to attract new investments, access new markets and develop new technologies, the mobility of human talent is a critical factor. Last year, 15,794 visas (5) were issued by the U.S Embassy in Mexico City and U.S. consulates throughout Mexico to intra-company transferees (6) of companies working in both countries.

Also, in January 2004, Mexico was liberated of burdensome restrictions in obtaining TN status to work in the United States. Generally, TN non-immigrant status may be available for Mexican and Canadian citizens who are members of the professional occupations listed in Appendix 1603.D.1 to Annex 1603 of Chapter XVI of Nafta. From the enactment of Nafta in 1994 until 2004, Mexican citizens were treated as substantially different from Canadians in obtaining TN status.

Prior to January 2004, Mexican citizens, unlike Canadians, were required to have an approved petition from the former U.S. Immigration and Naturalization Service and a certified labor condition application from the U.S. Labor Department, before applying for the TN visa at a U.S. consulate. Additionally, there was an annual numerical ceiling of 5,500 TN visas issued to Mexican citizens.

As a result of the previous restrictions, the numbers at right clearly demonstrate that the use of these visas has been overwhelmingly low by Mexican professionals as compared to Canadians, who were never subject to such restrictions:

Effective January 1, 2004, these burdensome restrictions and the numerical limitation have been removed and an increase in the number of TN visas issued to Mexican citizens can be anticipated. Today, to obtain a TN visa, the Mexican citizen need only present a passport, a visa application form and a letter describing the professional occupations, along with evidence of his/her professional and academic qualifications. As a result, Mexican professionals and technicians included in the list of activities and specialties described in Annex 1603 are eligible to be hired in the United States in a much more flexible and expeditious manner. These changes need to be recognized, understood, and approached as an opportunity for the business communities on both sides of the border.

However, do we have Nafta to thank for the growth in cross-border contributions to the economy? Regardless of Nafta's success or failings, and despite the politics involved in discussions between Mexico and the United States to reach a new migration agreement, the fact is that today we have a real binational labor market, in which certain segments of the U.S. economy have a systemic dependence on foreign workers, many of them Mexican nationals.

The hospitality, construction, nursing, meatpacking, and agriculture industries are some of the areas which continue to require the hiring of a labor force beyond the U.S. borders, and many of these shortage occupations are not covered by Nafta. Additionally, we need to think not only of the low-skilled, low-paid segments of the U.S. economy as the only market in which this labor integration is happening. The United States and Mexican business communities are already benefiting from the recruiting, training, and seasonal allocation of managers, technicians and skilled professionals.

As has happened in other regions of the world, economic integration is followed by a complementary and specialized labor market. Mexico and the United States are not an exception. The challenge both countries face is how to collaborate and think strategically to maximize this huge economic potential. As the communities continue to merge, we must strategically design recruitment and employment methods with a regional view that transcends national borders.

Non-Immigrant Visas Issued to Mexican Citizens

Fiscal Year 2003

TN Class--Family      436
TN Class            1,269
L Class--Family     8,274
L Class            15,794
H Class--Family     6,330
H Class           106,638
E Class             4,694
B-1               438,316

SOURCE: USCIS

Note: Table made from bar graph.

TN Visas Issued--1999-2003

         Temporary Visas Issued
         Mexico       Canada

1999     1,278        67,076
2000     2,059        89,720
2001     2,571        92,915
2002     1,821        71,878
2003     1,269        58,172

Note: Table made from bar graph.

Footnotes

(1) United States Hispanic Chamber of Commerce

(2) National Population Council of Mexico (Conapo)

(3) Immigration Statistics--Fiscal Year 2003, United States Citizenship and Immigration Services (USCIS)

(4) Colegio de la Frontera Norte, A.C.

(5) Immigration Statistics--Fiscal Year 2003, USCIS

(6) An Intra-company Transferee, or L-1 visa, is available to a non-U.S. employee who has been employed for at least one continuous year out of the previous three years at an affiliate outside of the United States who seeks to enter the United States temporarily in order to continue working for the same employer, or a subsidiary or an affiliate, in a capacity that is primarily managerial, executive, or involves specialized knowledge.

By, Mohar Quan & Fanning Law Group

Gustavo Mohar, Kimberley Fanning, Eric Chelini and Stephanie Tanger of the Mohar Quan & Fanning Law Group collaborated on this article.