Of debt and investment...

Highlights of the 1st quarter balance of payments statistics...

-- Foreign direct investment (FDI) was US$4.99 billion, higher than any quarter of last year and 9% larger than in the 1st quarter of 2012.

-- Portfolio investment inflows of US$10.09 billion: 29% lower than last year's quarterly average but double 1st quarter FDI.

-- Debt: The US$18.09 billion of net new indebtedness was 25% greater than net new indebtedness in ALL of 2012. Commercial banks took on US$16.46 billion in net new debt in the 1st quarter. Last year, they repaid (net) US$3.21 billion.

--Mexican deposits in foreign bank accounts soared US$14.42 billion in the 1st quarter. The other major component of the "assets held abroad" account, Mexican FDI, was US$3.71 billion.

--Revisions to prior year statistics increased the current account deficit, typically by 0.1 percentage points of GDP. Revisions increased the 2012 current account deficit 23%, from 0.8% of GDP to 1.0% of GDP.

--The revised 2012 figures cut outflows in the errors and omissions account by US$2.05 billion. That is only marginally less than the increase in the current account deficit, suggesting that it is not easy to categorize flows.

Mexican immigration to the US

Research by Dr. Daniel Chiquiar of Banco de Mexico, Mexico's central bank, projects that about 260 thousand Mexicans will go to the US annually between 2011 and 2017. The heyday of migration was in the 1990's. It's not coming back.

His research divided the sectors of the US economy into three tiers, based on skill levels. In the 1990's all three skill tiers (low, medium and highly skilled) grew at roughly the same pace. Between 2000 and 2007, employment grew most rapidly for most skilled labor. Between 2007 and 2010, employment of the least skilled was hit hardest.

Mexicans have suffered from those trends. About seven of ten Mexican workers in the US fall in the "least skilled" tier. Only about 13% are in the "most skilled" tier.  

Security at any price?

Two of every five immigrants living illegally in the US have overstayed their visas, according to estimates quoted in the May 14, 2013 Washington Post. 

It seems there's been a law since 1996 that calls for the government to use biometric data to verify when visa holders enter and leave the US. It hasn't been implemented. Costs certainly played a role in the decision

The Senate committee pondering immigration reform today rejected an amendment that would have required Homeland Security to use biometric indicators to track visa holders' entries and exits. The bill does include a provision that would strengthen verification using biographic data like photographs.

If you're working in Mexico, odds are you're in the informal economy...

There are now two measures of the size of the labor force working in the informal economy in Mexico. The broader measure – 28.2 million people in the first quarter of this year - is the newer one, introduced in February with the publication of the fourth quarter 2012 unemployment statistics. The new methodology includes categories of workers who weren't counted in the existing measure of employment in the informal economy: household help, informal agricultural workers, and employees working in formal businesses, the government and institutions who weren't registered in the Social Security Institute (IMSS).

The traditional methodology, now called “employment in the informal sector”, put the number of people working in the informal sector at 13.7 million or 28.7% of the working population in the first quarter of this year. The new measure (the “informal labor rate 1”) more than doubled the number of people working in the informal economy, adding 14.5 million people to the informal economy. 

Almost three of every five (59.0%) Mexicans worked in the informal economy in the first quarter. Interestingly, the largest percentage of the 14.5 million people who are now counted as part of the informal economy are not maids or agricultural workers. People working informally in companies, the government (!) and institutions accounted for 23.2% of total workers in the informal economy. That's nearly half (45.4%) of the increment from the broader definition. Wouldn't it be interesting to see how many of those workers are in the government? Agricultural workers accounted for a fifth (20.6%) of the grand total (40.1% of the increment) and household help, 7.5% of the grand total (14.5% of the increment). 

The November elections and immigration reform in the US...

The perception that Republicans must broaden their base to attract Hispanic votes spurred the formation of the bipartisan "Gang of Eight" following the November US elections. Will the surprising information in a US Census Bureau report published today dampen interest in reforming US immigration policy?

It turns out that even though 1.4 million more Latinos voted in the presidential election in 2012 than four years earlier, not even half (48%) of the Hispanics who were eligible to vote in 2012 did. The number of Hispanics eligible to vote grew more -- 2.3 million more Hispanics were eligible to vote in 2012 than in 2008. That being said, time will ensure that Hispanics become a more important voting bloc in the future. Hispanics account for 24% of the under 18 population, compared to 17% of the total US population.

The turnout rate of Hispanics in last November's election was well below that of blacks (66.2%) or whites (64.1%). Hispanics' turnout rate last November was lower than in 2008, when 49.9% of those eligible to vote did, 1.9 percentage points higher than in the 2012 presidential election.