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Latin American Workers
in US Send Less Home
Havana - The recession that has hit the United
States economy since 2008 has also brought about a
sharp drop in remittances to Latin American
households as immigrants from that region are among
the greatest victims of the global crisis.
About 75 percent of the remittances that Latin
American households receive annually come from the
United States. However, those who have relatives
living in other countries are also getting less
money.
According to a report released by the Latin American
Economic System, remittances to the region will fall
by seven percent this year as a result of the global
economic crisis. Those funds are expected to amount
to 64 billion dollars by years end, down from 69
billion dollars in 2008.
The figures were confirmed by the World Bank, the
Inter-American Development Bank's Multilateral
Investment Fund and a study on Migration and
Remittances in Times of Recession recently released
by the Center of Studies of the Inter-American
Dialogue.
Only 40 percent of the unemployed will keep sending
money home while 25 percent of those still employed
will send about 10 percent less than what they used
to send their relatives, added the source.
With the construction industry plummeting and an
unemployment rate above 11 percent among Hispanics,
that community is already feeling the effects of the
US recession. Latin American households will feel
the heaviest blow from falling remittances
especially in the second half of the year when
growing unemployment in the region will add to their
burden.
The United Nations Economic Commission for Latin
America (ECLAC) and the International Labor
Organization (ILO) said that over a million working
age Latin Americans may join the unemployed by the
close of the first quarter of the year.
According to those sources, urban unemployment in
Latin America and the Caribbean rose to 8.5 percent
in the period from 7.9 percent a year earlier.
Both ECLAC and ILO stressed that those figures
reveal the drama of millions of Latin America and
Caribbean men and women for whom the futue remains
rather uncertain.
This means that between 2.8 and 3.9 million people
are likely to join the 15.9 million unemployed in
urban areas at the close of 2008, according to the
report.
Before this discouraging situation arose,
remittances were registering a two-digit growth rate
fueled by an growing Latin American community in the
United States.
However, loss of jobs, falling income and slowing
migration have been hitting those who left their
native countries in pursuit of the American dream.
Haiti, Honduras, Guyana, Nicaragua, and El Salvador
are among the nations worst-hit by plunging
remittances while over 50,000 households will lose
an important share of their income for the same
reason. In statistical terms that share will account
for some one percent of the Gross National Product
of those economies.
Despite such dim prospects, unemployed immigrants in
the US are taking some of their savings to send
money back home while they are increasingly
marginalized as a result of the crisis, according to
human rights groups.
The good side of this story is that for millions of
those who send remittances home, the crisis has
resulted in a depreciation of their nations
currencies that is making their foreign money more
valuable than the other. This is one of the reasons
why between 10 and 30 percent of Latin American
youths keep thinking of migrating to the United
States.
It must be recalled that the unemployment rate among
Hispanics rose to 12.7 percent last May, when the US
overall jobless rate was 9.4 percent, a 26-year
high.
Statistics released by the US Department of Labor
show that the number of unemployed Hispanics climbed
from 2.521 million last April to 2.843 million a
month later, confirming the economic predicament
facing several minorities in the United States.
The world's largest economy has lost some six
million jobs since it went into recession in
December 2007, pushing the total of jobless people
to 14.5 million.
But the crisis has also caused unprecedented shifts
in the complex world of migration as remittances in
non-traditional corridors are on the rise while
Latin American immigrants are ready to travel within
their new country in search of a job, something many
native workers are not so willing to do.
Rises have also been reported in remittances from
Canada to the United States, proving that many
emigrants travel to Canadian territory looking for
opportunities to make some money to send to their
relatives back home.
Remittances are particularly important to Mexicans
as they work like a lever supporting domestic
development and greater production in poor rural
areas, despite the fact that those funds have fallen
by 10 percent this year.
The falling trend of those funds has accounted for a
931.4 million dollar-drop in remittances, according
to statistics released by Mexico�s Independent
Union of Agricultural Workers and Peasants (IUAWP).
IUAWP recalled that the number of Latin American
households that received remittances grew
significantly since the early 1990s, climbing from
660,000 to 1,252 million in the 1992-2000 period.
At a time remittances reached a level equal to 58
percent of Mexico's oil export earnings and for 98.7
percent of all money transfers.
Moreover, remittances were 35.3 percent higher than
the total foreign direct investment and 89.2 percent
greater than the country's tourism earnings.
Those statistics show that as it is increasingly
difficult to find a job, a large number of Latin
American immigrants living in the United States and
other wealthy nations are taking informal jobs at
home or resorting to self-employment as a survival
strategy for themselves and their relatives at home. |
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