Structural change in Mexicos employment and the impact of Nafta

Mexican society and economy are at an extremely complex historical crossroads.The Mexican liberalization strategy, as in many other Latin American countries, hasprivileged macroeconomic aspects, ignoring crucial issues such as savings and domesticinvestment, growth and employment, among others. The results of this strategy areunsustainable and present several weaknesses, as was evident in the crisis of December 1994.An important aspect of this situation is that the private sector is at the center of the crisis.Only a few economic activities have been able to generate employment opportunities abovethe minimum necessary for Mexican society. Several time series models demonstrate thatGDP growth is fundamental for job creation; however, it is difficult to imagine that it ispossible to achieve an annual GDP growth greater than 10%, the level necessary to absorbthe growth of the economically active population. To mitigate this situation, a profoundreformulation of the liberalization strategy and an explicit job creation policy are suggested. JEL Classification: F62; F43; F36.