Friday, May 06, 2011

Outsourcers of the World, Unite

Here's a scene from Querétaro's May Day parade (which was somewhat overshadowed by the beatification of Juan Pablo II) - a sign protesting the scourge of outsourcing, which "enslaves the workers and impoverishes the family - We Want Them Out!" All of which we agree with, generally, except this seems to misunderstand somewhat the basis of Querétaro's economy, which consists largely of assembly jobs formerly done by Americans, Canadians and Europeans, but are now performed by Mexicans for two bucks an hour.

We're thinking maybe the UAW snuck this banner into the parade.


Mexfiles said...

I think you misunderstand how "outsourcing" is used in Mexico. The English word is used because this new form of tax avoidance,has no Spanish word.

Employee benefits are not a tax deductible expense, and Mexican workers are entitled to profit sharing — so "outsourcing" was invented to screw the workers (and avoid unionization).

Major corporations have, technically, no employees. The most notorious is Coca-Cola, whose entire payroll is made up of executives. The workers are employees of "outsourcing" companies, which happen to be owned by Coca-Cola. And Coca-cola, by writing off the costs of the "outsourcing" avoids both taxes (services are deductible) and employer contributions to IMSS (which are based on the number of employees on your payroll). As "employees" of "outsourcing" companies, the workers are kept in smaller units, which hinder unionization, and, incidentally, rob IMSS of its funding, which most of us who live here depend upon for our health benefits.

Burro Hall said...

See, I knew you'd explain this. I just didn't feel like sending a private email.

Kind of amazing there's a form of tax avoidance for which there's no Mexican word, though. It's not exactly a new concept here... said...

My friend Wil who works for Hutchinson in Reynosa makes about $60 a week for his regular hours of M-Th, 7 AM - 7 PM. That's $1.25 an hour. He has to work Friday and Saturday for overtime to survive. Everyone else I know who works at a maquila make about the same. I'm not making a judgment or throwing out my opinion. I'm just sticking to the facts.