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activities. Although productivity as a whole has
fallen by 0.23 basis points, there are 16 economic
activities showing productivity growth. Four of
them with significant numbers: Telecommunications
(4.19), Massive media management (2.71), Courier
and parcel delivery (1.99) which are innovative
industries of recent arrival. Other traditional
industries included Mining (0.34), Financing
activities (1.54) and Vehicle manufacturing (0.84).
But then, industries whose growth has exploded
because of North American Free Trade Agreement
(NAFTA) such as electronic devices manufacturing
have marginal positive numbers anchored in transfer
pricing regulations.
Some of those results are highly conclusive. For
example: electronic equipment manufacturing has
grown at an average of 12.44% per year, while its
capital consumption did at a rate of 0.67%, labor
at a rate of 0.35% and materials at a pace of 8.82%
each year, showing that revenues surged in market
growth as sales went into materials, not into labor
retribution. Within those numbers an explanation
arises, research and development in electronic
devices is collected by means of paying for the
imported components, manufactured abroad, that
are to be assembled domestically.
But when data is analyzed otherwise, several
conclusions can be exposed. One of them stems
from constructing a cumulative growth indicator,
settling the index at number 1 in year 1991, and
making it grow compounded yearly at the real
growth rate reported for each KLEMS factor at each
economic activity. What is to be found out could
be the comparative growth rate of Production
Output versus growth in Capital Investment, Labor
Retribution or Materials Consumption.
In the economy as a whole, results show production
output reaching a 2.056 factor, capital growth at
1.390, labor growth is 1.093 and productivity as
mentioned before reduced in this case to 0.918.
Imagine a linear graphic in which capital growth
line has an inclination of 39 degrees and labor of
9.3 degrees. That pattern repeats itself in most
industries.
Taking an average point of view another graph can
be constructed in which the X axis shows average
growth in capital and Y axis average growth in labor
retribution. At the right extreme, financial activities
settle the record with a 3.84 annual percent growth
while labor in this industry grew 0.52%. Using
this graph to identify corresponding point for 26
industries and inserting a linear adjustment line, its
equation shows that for each unit of capital growth,
labor grew 0.114.
Of course opening markets to global commerce has
been a success. Leveling pillar 8, Financial market
development (35) sets Mexico at the brink of the
34 countries that compete among the Innovation
driven economies stage, but then, there is the Labor
market efficiency pillar that reports place 105 that
diminishes place number 11 in market size.
Why is that so? Because of income distribution.
Assembling components labor cannot be rewarded as
inventing and manufacturing technological devices
are. Machine manufacturing also, both involve
innovation, which is the clue to productivity based
on higher education; thus this pillar still qualifies
in number 80. Another source of little or even less
value added jobs are informal market activities,
such as street commerce or standing food services.
They are simple jobs that grew fast while financial
crisis arose but that must be overcome by newer
generations of business. These informal activities
still account for 59% of Mexico´s labor force.
The
next
decade
brought
several
root
accomplishments. A new labor law, which
emphasizes Productivity and dignified salaries was
approved in 2012. This regulation includes the
design of a National Productivity Council in which
four parties participate: Government, Academy,
Unions and Business representatives. It started to
work with quarterly conclusive meetings facing
budget restrictions in every single resolution -and
there have been several-, with no financial backing,
just collaboration agreements.
Another important step forward is to be singled out.
Ruling PRI party at the beginning of its 2012-2018
term accomplished a leapfrog initiative setting a
Pact for Mexico, with the two other leading parties
PAN and PRD that turned out in several structural
industrial reforms in order to get rid of antique
mindsets. One of the so called profound reforms
that has -up to now- obtained important investments
is the Energy Reform, allowing exploration and
productive capabilities in association of private
and public investors with foreign investments.
Other reforms include the education system and
the telecommunication in order to melt down
monopolistic privileges acquired decades before, as
this industry was privatized.
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