Labour and Economic Integration: The Case of the Electronics Sector in Mexico

Abstract

The North American Free Trade Agreement (NAFTA) represents a very different response to the globalization process than the European Union (EU), and the contrast between the two regions is exemplified by the approach to labour issues. Both regions have had to face global demands for increased competitiveness, but while the EU has adopted a series of institutional measures which seek to prevent the downward harmonization of wages and labour standards, for example in the form of regional and structural funds, the Social Charter, and the Social Dialogue, such initiatives are practically absent in NAFTA. Besides the weak ‘parallel agreements’ on labour and the environment which were attached at the very last minute to an otherwise purely commercial and financial treaty, there is no institutional framework in NAFTA designed to discourage downward competition on wages and labour standards (as opposed to competing in product design, quality, production capacity and so on), nor to alleviate the consequences for workers as they experience the adverse pressures of the free market.