The trade pact being negotiated between the United States and Mexico gets a bit convoluted when it comes to North American content of cars manufactured in Mexico. The numbers are aimed at increasing content manufactured in the United States.
The Office of the U.S. Trade Representative said Monday that Mexico had agreed to ensure that 75 percent of automotive content be produced within the trade bloc (up from a current 62.5 percent) to receive duty-free benefits and that 40 percent to 45 percent be made by workers earning at least $16 an hour. Those changes are meant to encourage more auto production in the United States.
The interesting number here is $16 an hour…now of course this doesn’t insure that Mexican autoworkers will make at least that…they usually make far less…it is aimed at using more parts manufactured in the US…but could certainly be manipulated by Mexican autoworkers to improve their wages and working conditions…to keep manufacturing in Mexico.
But just curious…they US negotiators think $16 an hour is a cool wage…when we can’t get $15 an hour minimum wage enacted here. Hmmmph.