4/26/2019 – Bloomberg
By Nacha Cattan
Mrs. Martínez earns $79 for a six-day week working in the produce section of a Walmart in Mexico City. A labor union bargained with the retail giant to get her that salary, but she’s never met a representative. She didn’t want to be named for fear of reprisals, but she says she hasn’t even heard of the union.
“Bargaining” is a stretch to describe what the union actually did, which is more like rubber-stamping. The collective contract that covers Martínez’s store allows starting salaries around the minimum wage, which has fallen so far behind inflation that few in the capital actually work for it. Walmart Inc. pays dues on workers’ behalf.
That’s not how unions are meant to work. But in Mexico they do, and not by accident. Low pay has been central to the country’s economic strategy in the quarter-century since Nafta began, boosting its appeal as a cheap base for exports to the giant consumer market up north. Many businesses that took advantage of cheap Mexican labor were American, turning the wage gap into a bone of contention between the two countries. The United States-Mexico-Canada Agreement, negotiated last year to replace Nafta, has more worker protections. But U.S. lawmakers—particularly House Democrats—insist on proof that Mexico is finally serious about boosting wages and threaten to block ratification of the deal until they get it. Mexico’s new labor-friendly president, Andrés Manuel López Obrador, says he wants an economy that’s more driven by domestic demand anyway, which puts the unions in a political vise.