CROSS-BORDER WORKFORCE Yuma County positioned to receive manufacturers
With increasing political and economic tensions in Europe and Asia, companies are looking to reduce the risk by bringing manufacturing operations back to the U.S.
Yuma County is well positioned to take advantage of this reshoring trend with its unique location and relatively attractive real estate prices, according to a newly released study.
The Phoenix metropolitan area might be one of the first places they consider, but rising real estate prices are forcing them to look at other areas, including Yuma County.
The Greater Yuma Economic Development Corp. has been fielding calls from interested manufacturers, and there’s always one thing they want to know: Does the region have the necessary workforce to fill the jobs created by new and expanding companies considering the region? Many of these jobs are administrative and junior managerial positions that require technical skills and/or engineering degrees.
The answer is yes, according to the GYEDC. But the agency needed data to back up the claim.
“We have these mega projects knocking on our doors, and we need to put them at ease,” noted Julie Engel, president and CEO of GYEDC.
So GYEDC and several partners commissioned a binational workforce study to demonstrate Yuma’s ability to fulfill these jobs. Partners in the study included the Arizona Mexico Commission, Arizona Commerce Authority, Greater Yuma Port Authority, Yuma County and the communities of Yuma, San Luis, Somerton and Wellton.
On Wednesday, analyst Erik Lee Bedoya, an expert on U.S.-Mexico border trade and global markets, released the study results at the GYEDC Quarterly Investor Luncheon.
His research revealed that a plentiful supply of accessible workers is within reach of Yuma County, and the source might be unexpected. They are found across the border in Mexico. Mexicali and San
Luis Rio Colorado have a large manufacturer workforce, with many workers holding dual citizenship or qualified for visas that would allow them to work in the U.S. These cities also have strong technical degree programs that are already churning out a cross-border manufacturing workforce.
In his presentation, “The Border as a Resource: Yuma County’s Cross-Border Regional Workforce Dynamics,”
Lee Bedoya explained the very specific market conditions that make Yuma County attractive to manufacturing companies.
Asia had been the longtime choice of many manufacturers due to the low cost of labor and materials, but the COVID-19 pandemic has caused supply chain issues in Asia and political and economic tensions have become heightened between China and the U.S. These conditions are accelerating the nearshoring and reshoring of manufacturers.
The armed conflict in Europe has added “impetus to decouple” from the Chinese and Russian economic influence, noted Lee Bedoya.
“It’s in our interest to bring manufacturing closer to us where we can control the inputs better,” he said.
Phoenix is running out of industrial real estate, pushing manufacturing out to other markets that had never been considered before. This could potentially work out very well for the Yuma area, where cross-border traffic flows and supply chains were tested during the pandemic but still remain intact.
Hundreds of thousands of U.S. citizens living in Mexico have the required technical expertise and specific knowledge and skill sets. Just Mexicali and San Luis Rio Colorado have about 100,000 high-skilled technical and managerial positions.
The border region has four ports of entry already used daily by a large number of workers who live in Mexico and work in the U.S. The study found that during April 2020 up to 27,000 U.S. citizens and permanent residents crossed northbound on a daily basis.
Engel pointed out that even at the height of the pandemic, when the border was closed to non-essential business, 27,000 people crossed the border daily. She explained that April was chosen for this part of the study to isolate the sought-after workforce. If done earlier, agriculture workers would have skewed the numbers.
Mexico has an abundant postsecondary technical degree program related to manufacturing.
Mexicali has more than 47,000 enrolled students and more than two dozen higher education institutions with 9,355 new grads each year. Engineering, technology, manufacturing and construction majors account for 27% of the total.
San Luis Rio Colorado has more than 4,800 enrolled students distributed in higher education institutions with 800 new graduates each year. Engineering, manufacturers and construction majors account for 22% of the total.
“Mexico has a lot of problems. One problem they don’t have is producing engineers,” Lee Bedoya quipped.
In addition, Mexican institutions have U.S. citizens studying technical degree programs. The research indicates that about 240 U.S. citizens graduate from postsecondary technical degree programs in Mexicali and San Luis Rio Colorado annually. GYEDC is just starting to work with Mexican institutions to find these students.
This is only Mexicali and San Luis Rio Colorado and does not even consider other regional cities such as Hermosillo, Tijuana, Ciudad Obregon and Ensenada, Lee Bedoya noted.
Firms can use work visa programs to recruit talent in Mexico, however, with very little organized means for recruiting, there is a need for a formal placement or recruitment mechanism to match these workers with interested companies.
Several temporary work visas are available to people with college degrees, specialized expertise in specific fields or extraordinary or exceptional abilities. A visa is also available as part of the trade agreement between the U.S., Mexico and Canada.
Mexican degrees are transferable to the U.S. For example, for a trade agreement visa, a person needs to have a diploma and an employer ready to hire the worker.
The cross-border workforce is immediately available, but local efforts are also underway to grow the future workforce.
“Our ace in the holes are Arizona Western College and our universities that are creating that pipeline and listening to employers for what skillsets are needed going into the future,” Engel said.
“It’s astounding how we’re growing our own workforce,” she added.
Find the complete report here: https://tinyurl.com/5xvs8cw4.