Jobs generated by the USMCA have been 154% more in the United States than in Mexico, according to Marcelo Enrard, Secretary of Economy.

This treaty entered into force in July 2020, replacing the North American Free Trade Agreement (NAFTA), in force since January 1994.

The USMCA arose as a demand of Donald Trump in his first term as President of the United States. Trade openness remained the same, with a virtual elimination of tariffs. But Trump included new provisions, such as stricter rules of origin in the automotive sector. A labor dispute settlement mechanism and a review clause for the new treaty were also introduced, among other changes.

Jobs generated by the USMCA

Since Trump’s triumph for his second term as President, Ebrard has vehemently defended the USMCA.

“This is working, look at this data: if we take 131 jobs in Mexico created as an effect of the Treaty, in the United States companies have created 333 jobs,” Ebrard said as part of a presentation at the GZERO Summit Latam, an event organized by Eurasia Group.

“This is impressive, because rules of origin were changed, many changes were made,” added the official 

Automotive Industry

The T-MEC, like its predecessor, NAFTA, continues to be key to the success of the automotive industry, according to a recent report by the United States Trade Representative (USTR). The report notes that free trade in originating vehicles and parts has strengthened the integration of production in North America. In addition, the agreement’s rules of origin have encouraged greater investment, increased regional content and created more jobs in the region’s automotive sector, significantly improving its competitiveness.

An economic model developed by an automotive industry association points to relevant data on vehicle content. For example, it is estimated that 50% of the content of automobiles assembled in Canada comes from the United States. Likewise, approximately 35% of the content of vehicles produced in Mexico originates in the United States.

The industry believes that these high levels of U.S. content in Canadian and Mexican vehicles illustrate the positive impact of the USMCA. This agreement has reinforced the benefits of an integrated North American automotive supply chain, providing a competitive advantage for the region in global markets.