Mexico is quickly becoming the world’s main go-to manufacturing hub, boasting close proximity to the U.S., Canada and other important markets, as well as fewer restrictions, much better working conditions and more competitive labor costs than China. Growth in the nation’s manufacturing sector indicates that more international companies than ever before are moving operations to Latin America’s second largest economy.
“Mexico has a unique opportunity to steal the thunder of no less a giant than China,” stated acclaimed British economist Jim O’Neill. “Mexico’s weight in the world economy, especially in manufacturing, is already considerable.”
Fact #1 – It’s Easy to Operate a Business in Mexico.
Although China has long been hailed as the undisputed world leader in manufacturing, it is actually much more difficult for a business to establish a business here, not to mention the many restrictions that are associated with keeping it running over time. In fact, according to a recent report by the secretary of the economy, Mexico has less than half the number of required procedures necessary to open a business than China. As a result, it also takes much less time to get a business launched in Mexico, with the average being 9 days, compared to 22 days in China. Construction permits are also much easier to obtain in Mexico, with an average of around 69 days, compared to 270 days in China.
Fact #2 – Mexico Has a Superior Workforce
Mexico has a much younger and more highly skilled workforce than China, with many well-educated young people coming out of tech schools and universities ready to work the nation’s booming high-tech manufacturing sector. In fact, businesses in Mexico have introduced a growing number of positions in recent years that require a B.A. or higher in engineering; a trend that shows no signs of slowing down. In addition, labor costs in Mexico are expected to be much lower than China in the very near future, and are already more than competitive – especially when you factor in the geographical advantage of doing business in Mexico.
Fact #3 – Manufacturing in Mexico Promotes U.S. Job Growth
It’s hardly a secret that Mexico’s economy is closely linked to the U.S., but many don’t realize that businesses operating south of the border are also helping to stabilize economic conditions to the north in a mutually beneficial relationship. In fact, as industries from Canada, the U.S.,Europe and other nations expand operations in Mexico, it is becoming clearer than ever how important cross-border cooperation is for both nations. According to the U.S. Chamber of Commerce, there is an average of $135 billion in total two-way trade dollars changing hands every single day, including the movement of imports and exports like computer equipment, ores and minerals, motor vehicle parts, iron and steel, chemicals, seeds and grains, oil and a variety of general purpose machinery.