Thursday, January 29, 2009

Intro to Socioeconomics in Mexico

The other day, we went to the market for an activity in small groups.  We were supposed to buy certain items and price some others.  Then we did some calculations to figure out how many hours a person earning the Morelos minimum wage would have to work in order to be able to buy them.  Then we figured out the price U.S. consumers would have to pay if they had to work the same numbers of hours as a Mexican worker in order to purchase the same thing.  Here are the calculations from my group:

1 kilo of avocados = 25 pesos = $1.92 = 4 hours of work = $26.20
1/2 kilo of green chiles = 8 pesos = $0.62 = 1.3 hours of work = $8.52
Magazine "Uno más uno" = 10 pesos = $0.77 = 1.6 hours of work = $10.48
Kids school shoes = 120 pesos = $9.23 = 19.3 hours of work = $126.42
Shampoo = 50 pesos = $3.85 = 8 hours of work = $52.40
People think that the cost of living in Mexico is really low, but that is only because things are really cheap compared to what we earn in U.S. dollars.  In actually the cost of living here is really high if you are living off the wages paid here.  It is also estimated that 50% of Mexicans work in the informal sector, which means that they don't receive a paycheck or benefits.
The minimum wage in the state of Morelos is 49.5 pesos per day ($3.80/day), which is the highest minimum wage in Mexico.  So even if Mexican immigrants in the U.S. don't earn minimum wage (which many don't because they can't complain if they are undocumented), they can earn more money in an hour of work in the U.S. than for an entire day of work in Mexico.  And people wonder why they try to work in the states....