At least 30,000 workers at 41 factories in Matamoros, Tamaulipas, went on strike at 2:00pm yesterday after failing to reach an agreement for higher pay, triggering dire warnings from business leaders that the economic losses could be considerable.

The members of the Union of Laborers and Industrial Workers of the Maquiladora Industry (SJOIIM), are demanding a 20% salary increase and an annual bonus of 32,000 pesos (US $1,700).

In a letter sent to the companies that operate the maquiladoras, or factories, the union said the demand for a raise is independent of any salary increases as a result of the doubling of the daily minimum wage in the northern border area to 176 pesos (US $9.25).

At least 45 maquiladoras in Matamoros, most of which are in the automotive and electrical sectors, have been partially closed since January 12 as the SJOIIM negotiated with companies for increased pay.

The union reached agreements on behalf of around 2,000 workers at four factories – Polytech, AFX, CTS and Core – but the demands of around 30,000 more have not been met, precipitating yesterday’s walkout.

As a result of the labor uncertainty, one company, Cepillos de Matamoros, has announced that it is closing its factory and leaving the city, while another, engineering company Parker, appears to be doing the same although it has made no formal announcement.

At least two other companies have also signaled their intention to leave the northern border city and another has suspended work on the expansion of its plant.

Thousands of jobs are expected to be lost as a result of the closures.

The federal government tried to stop yesterday’s strike by proposing that negotiations between the union and companies be extended by 10 days.

But according to Juan Villafuerte, general secretary of the SJOIIM, the proposal made by Labor Secretariat undersecretary Alfredo Domínguez came too late.

Villafuerte said he expected at least three companies to leave Matamoros.

Domínguez told a press conference yesterday that the strike would not just have an impact locally but also at a national and even international level.

He said the union and affected companies would now have to negotiate at the Conciliation and Arbitration Board in the Tamaulipas state capital, Ciudad Victoria.

Abel Morón, president of the Matamoros chapter of the Mexican Chamber of Commerce (Canaco), estimates that monthly economic losses associated with the strike action could exceed 120 million pesos (US $6.3 million).

As many as 20,000 jobs could be lost and the labor market and local economy could take up to a decade to recover, he said.

Luis Aguirre Lang, president of the National Council of the Maquiladora Industry (Index Nacional), said the pay increases sought by the factory workers are beyond the means of the affected companies if they wish to remain competitive.

Speaking at an event in Ciudad Juárez, Chihuahua, Aguirre called for President López Obrador to mediate the dispute, explaining that Index Nacional has already requested a meeting with the president so that he sees “the transparent spirit with which our industry meets [the needs] of Mexican workers.”

In a Twitter post yesterday, federal Labor Secretary Luisa Alcalde said the government was involved in the negotiations even though she considered the dispute a state matter.

“With respect to the labor conflict in Matamoros, despite it being a state issue, the Secretariat of Labor and Social Welfare is contributing so that an agreement is reached. We’ve called on the parties to continue with dialogue for the good of the workers and the sources of employment,” she wrote.

A national business leader warned in a Twitter post that dozens of businesses, thousands of workers and Mexico’s reputation are at risk.

“It’s been a long time since Mexico experienced a crisis of this magnitude,” wrote Gustavo de Hoyos Walther, president of the Mexican Employers Federation, Coparmex.

Source: El Financiero (sp), Milenio (sp)