McALLEN, RGV – Notwithstanding public safety concerns, business is booming in Reynosa, according to a maquila plant manager.
Mike Myers is general manager of Metal Industries, Inc., in Reynosa, and a board member for INDEX Reynosa, the maquila trade association. He spoke about the local economic climate at a recent McAllen Economic Development Corporation meeting.
“Business is booming. We can barely keep up. The majority of us are working overtime, we are hiring, bringing more stuff in and out, across this border. That is a great thing,” Myers said.
Myers did acknowledge that there are some negative currents swirling around.
“The negative stuff is the violence or perception of violence. And, I hate to bring in politics but fake news is also hurting us. There is not a lot of real news on the southern side of the border. So, people go to social media. Anyone on social media can write anything, they can create some crazy stuff.”
By way of example, Myers said he recently got a call asking if it was true that there would be no taxis or public transportation because of violence in the city.
“This is the kind of crazy stuff we have to deal with. We have to calm our employees down. At the end of the day it impacts their coming to work and going home from work. Our work is built on hours worked and products produced.”
Myers said when things are booming, maquila plant managers are looking at ways to increase efficiency. What can slow things down, he said, is a shortage of labor.
“The labor shortage is there. We are having problems bringing people up (from the interior of Mexico). When you have more jobs than employees they can take their pick. As the manager of an independent facility you have to be on your game. Pay is basically the same (in all the maquilas) so working conditions, soccer uniforms, what food you have available in the cafeteria, these things matter. You have to be on your game to keep your people and get people through the door,” Myers said.
In fact, he said, things are so much weighted for the employee right now that maquila companies are having to offer sign-on bonuses.
“We have to pay sign-on bonuses to bring our employees in to build our TVs, cars. Sign on bonuses to get employees through the door and stay with us for a certain amount of time.”
Myers acknowledged that with the Peso regaining strength in relation to the dollar, Mexico’s maquilas are not quite as competitive as they were. This is because maquilas purchase their raw materials in U.S. dollars. He also said one of the three trade unions in Reynosa is beginning to flex its muscles.
“There are three major unions in Reynosa and we are having problems with one of them right now. We think it is politics but it does not matter what we think. You cannot afford to be down an hour a day or half a day,” Myers said.
“But again, business is booming.”
Myers’ report to the McAllen EDC board reinforced a message given by IMMEX (Industria Maquiladora y Manufacturera de Exportación) last week. A new report by INEGI (Instituto Nacional de Estadística, Geografía e Informática) that was promoted by IMMEX showed employment in Reynosa maquilas in March 2017, at a record high. According to a study of IMMEX companies, Reynosa registered 101,861 jobs, which represents an increase of 1,593 jobs compared to the same month last year.
Previously, the largest number of IMMEX jobs in Reynosa – 101,589 jobs – was registered in October 2007, just as the 2007-2008 recession was getting underway.
Martha Ramos Morales, director of INDEX Reynosa, said because of the growth of maquila business, her group has contacted federal and state authorities to “work on special programs to ensure better services and more urban infrastructure in border communities.”
INEGI reported that in March 2017, 148 IMMEX companies were operating in Reynosa, while in Tamaulipas the number was 354. Tamaulipas ranks fifth in the nation for IMMEX employment. INEGI also reported that the number of jobs related to IMMEX industries in Mexico increased by 0.1 percent, reaching 2.3 million workers.
At the McAllen EDC meeting, Keith Patridge, the group’s president, and Ralph Garcia, the group’s vice president for business retention and expansion in Mexico, spoke about the state of the maquila industry in Reynosa.
Garcia said: “One of the cool things we are seeing is that, in the first quarter of this year, we have about one million square-feet of industrial space under construction in Reynosa. That is pretty high.”
Garcia singled out Ametek, which makes electric motors. The company is expanding by 90,000 square feet its plant in the Villa Florida Industrial Park in Reynosa. “They are exploring additional group options in Reynosa and other communities as business continues to grow,” Garcia said.
Garcia did acknowledge the security situation “has caused headaches for a lot of managers.” He said security impacts the ability to maquila plant managers to recruit new staff. people. “Long term, what the Governor is trying to accomplish will have a positive effect on the city and the community. But, currently it is impacting business.”
In his report, Patridge said there are about eight new companies McAllen EDC is working with on the Mexican side. “Two are under construction, building about 658,000 square feet of space. Six are at various stages of site selection. That would mean another two million square feet of space. These are big companies, big operations looking at establishing operations in Reynosa.”
Patridge added that he hopes the violence in Reynosa is over soon “so we can grow our businesses even more.”
Editor’s Note: The main image accompanying the above story shows Ralph Garcia, vice president of McAllen Economic Development Corporation, Mike Myers, board member of INDEX Reynosa, and Juan Rafael Zubiaga Gaytán, administrative director of COBIFER. (Photo: RGG/Steve Taylor)
