Mexico pushes state-backed training to aid unemployed
President’s flagship scheme to tackle joblessness among the young is under scrutiny
Jude Webber, FINANCIAL TIMES, December 19, 2019
Like more than 5m young Mexicans, Fernanda Muñoz felt stuck. “I couldn’t find a good job and I didn’t have a clear idea about what to study,” she says. But in April, the 23-year-old joined a government apprenticeship scheme and now brims with enthusiasm.
Her training includes writing for, and distributing, an independent newspaper and cooking unwanted food from Mexico City’s central market and delivering it to people in need. She takes philosophy, art and other classes at the social enterprise where she works. Best of all, she has been promised a job when her one-year term is up.
Ms Muñoz is one of nearly 1m Mexicans enrolled in Young People Building the Future, one of President Andrés Manuel López Obrador’s flagship social programmes for unemployed young adults. He says the government has historically turned its back, allowing them to be labelled pejoratively as ninis, or neither-nors, when they are really victims of a lack of opportunities.
The programme comes as Mexico is struggling with a failing education system, illustrated by its dismal performance in the OECD’s Pisa assessments that compare the performance in member nations of 15-year-olds in reading, maths and science. At the same time, Mexico faces acute skills shortages: half of companies surveyed by Manpower Group complained in 2018 of having trouble filling jobs.
The programme had to hit the ground running when Mr López Obrador — who is on a breakneck mission to transform Mexico — took office a year ago.
It has suffered teething troubles. A scathing report in August by Mexicans Against Corruption and Impunity, a respected non-governmental group, found the programme’s data was “improbable, incomplete and unverifiable” despite laudable objectives.
The scheme matches would-be apprentices with employers — over 80 per cent are small businesses — for a year’s training and pays a 3,600 peso ($188) monthly stipend. Big businesses, which have publicly put qualms about the leftist populist president behind them, have also signed up.
Femsa, the Coca-Cola bottler that runs Oxxo, Latin America’s largest chain of convenience stores, took on some 400 apprentices, of whom it has hired 20. Some apprentices initially lacked the basic skills to succeed in job interviews.
“Without this programme, it would have been difficult for many of them to enter the formal labour market,” says Mauricio Reyes, a company representative. It has been a two-way street, he adds: “It has opened our eyes to a very different world.” While corporate HQ may have taken a dim view of would-be employees covered in tattoos, for example, “we realised they could relate well to many of our clients”.
Pablo González, chief executive of Kimberly-Clark in Mexico and head of the education committee at the country’s biggest business lobby, the CCE, says the programme offers a vital opportunity in a country where a fifth of the population is aged 18-29. “You can’t expect it to bear fruit overnight,” he says. “In a few years, this will change people’s lives more and more.” He agrees that while large companies can offer apprentices training in things like coding and English, smaller businesses lack resources, leading to patchy results.
“Some companies just use apprentices as free labour,” says Mr Reyes.
Raymundo Guzmán, 23, was assigned to a coach company where his job was to check vehicles were clean and equipped for each journey. He says he was verbally abused and asked to clean the buses and load luggage which he did, despite that not being part of the job. He has since left the apprenticeship.
About 4 per cent of 1m or more young people signed up for the scheme since its launch have dropped out.
“They don’t ask the impossible, but they do ask us to work and some people think that since it’s a government subsidy, all you have to do is turn up,” says Ms Muñoz.
Alexandra Zapata, deputy head of the Mexican Institute for Competitiveness, a think-tank, says the scheme will be judged a success only if it matches people with opportunities “to really learn” and if that then “translates into a better skillset to be really employable” — but that it ran the risk of being simply “adult day care”.
Some apprentices have also found they can make more money in Mexico’s black economy — more than half the economy is made up of enterprises that pay no taxes or benefits.
Horacio Duarte, labour undersecretary, says adjustments have been made to outlaw abuses — some companies tried to keep part of the stipend, for example — and make the programme more accountable. As the first 20,000 prepare to graduate in February, “we will judge success based on the numbers who get jobs afterwards and how many decide, if they can’t find jobs, to set up their own businesses,” he says.
“This [programme] is a help, of course,” says Mónica Flores, chief executive of Manpower Group in Latin America. “But the problem is much more complex than a one-year apprenticeship.”
Deported Mexicans provide lifeblood for domestic economic development
There, some of the 200,000 or more Mexicans returned every year exploit their skills in call centres by using fluent English and a bicultural sensibility that allows them to crack jokes or employ native slang.
For many, it is the first formal job they can aspire to in Mexico, which can feel more like a foreign country than home for some returnees. But high churn means an average worker lasts just eight months.
Yet with a talent pool of people who have often lived for years in the US and obtained a better education than may have been available at home, Mexico could and should do more to leverage their skills, says Eunice Rendón, a former government official and migration expert. She laments what she calls a “systematic failure to understand the added value they bring”.
English teaching is one of the obvious avenues open to returnees, such as Mauricio López, 25, who came back to Mexico nearly three years ago. “My mission is to give our community a tool so, that way, they don’t have to rely on call centres,” he says.
He lasted three months working the phones but quit to found an English school. “I have too many skills to be answering calls all day and helping foreign companies reduce their salary budget,” he says.
Many returnees possess skillsets that “Mexico isn’t very good at developing on their own, hence the reason that so many people have left over the years as migrants”, notes Benjamin Waddell, an expert on migration at Fort Lewis College in Colorado. “I think we’re only seeing the tip of the iceberg when it comes to their potential to contribute to Mexico’s development.”
New Comienzos, founded by deportee Israel Concha, helps match returnees with local opportunities and training. His organisation has helped them obtain certification for their English and other skills. He sees potential to put what they learned in the US to work in logistics, the car industry, agriculture, services, tourism and tech and online marketing sectors in Mexico. He has also been contacted by real estate and insurance brokerages that are keen to find a way to hire returnees.
Mr Concha recalls a former head of the Mexican adult education institute telling him: “You guys are the icing on the cake. You haven’t cost us anything [to train] and are fully bilingual or even trilingual.”
Speaking English can also give bright returnees the opportunity to fill Mexico’s deficit of software developers and engineers. Training venture Hola Code runs five-month boot camps based on a successful Silicon Valley model, and can boast an average 74 per cent employment rate at the end for the three cohorts it has taught to date.
“This generates social mobility,” says Aida Chávez, Hola Code’s head of student affairs, noting that graduates can earn five times as much as in a call centre. “It proves the theory that harnessing the skills of returnees and migrants can lead to very efficient integration,” she adds. “We have a flow of people that is a gift for Mexico
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