Worker Displacement in the US/Mexico Border Region: Issues and Challenges.

Author:Pedace, Roberto
Position:Book Review

Worker Displacement in the US/Mexico Border Region: Issues and Challenges, edited by Jose A. Pagan. Northampton, Mass.: Edward Elgar Publishing, Inc. 2004. ISBN 1843767651, $65.00. 144 pages.

The purpose of this book is to analyze worker displacement in Texas along the USA/ Mexico border. This edited volume is a collection of work from scholars in various fields of social science. It provides a rare interdisciplinary view of worker displacement causes, effects, and solutions in a unique regional labor market. Jose Pagan argues that the USA/ Mexico border region deserves special attention because the education, training, and English language skills of the labor force are below the national averages. In chapter 1, the introduction, Pagan also claims that this border region has disproportionately suffered from import competition, business relocation/closures, and the overall effects of NAFTA. While many of the displaced workers in the border region have qualified for training and education through Trade Adjustment Assistance programs, these efforts have been largely unsuccessful.

In chapter 2, Cynthia J. Brown and Marie T. Mora illustrate the specific characteristics of the border region which challenge the existence of a well-functioning labor market. Several characteristics of this area that must be considered include a high fraction of high school dropouts, a lack of English language proficiency, and high structural unemployment resulting from abrupt industrial shifts (from manufacturing to service).

In chapter 3, Alberto Davila and Andres Rivas examine the characteristics of displaced workers and their subsequent re-employment. Using data from the Current Population Survey (CPS), the authors discover that the border region suffers from less re-employment (after displacement), more unemployment, and less labor force participation. Interestingly, gender differences in these labor market outcomes are larger relative to the rest of the country, but the racial/ethnic differences are significantly smaller.

In chapter 4, Pagan utilizes input-output modeling to illustrate the direct and indirect effects of worker displacement. The estimates suggest that for every three jobs lost directly (mostly due to plant closings/relocations), two additional jobs are lost due to indirect effects from reduced spending. Direct job displacement has greatly affected the manufacturing industry, but the indirect effects on the trade, finance/insurance/real estate...

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