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April 1995, Volume 2, Number 4

Illegal Immigration and the Peso Devaluation

Experts predicted in 1994 that Operation Gatekeeper would reduce illegal immigration from Mexico. But then came the 50 percent devaluation of the Mexican peso, and the number of aliens apprehended jumped in January and February 1995 over 30 percent above year earlier levels, with especially sharp increases in apprehensions in Arizona.

The spring and summer of 1995 will provide a test of how well beefed-up US border controls can cope with sharp increases in Mexican emigration pressures. The peso has lost about 50 percent of its value since December 20, 1994, widening the US-Mexican wage gap from 8 to 1 to about 12 to 1 (wages in Mexico have been raised). In addition, up to 10 percent of the 10 million Mexicans who have formal sector jobs may lose them.

There have been several attempts to project Mexico to US migration in 1995. Princeton demographer Tom Espenshade, who puts the annual flow of unauthorized Mexicans in the US sometime during a typical year at 1.5 to 3 million, predicted for the US Treasury, an annual increase of 460,000 illegal border crossers including about 40,000 who would settle in the United States.

Most US migration researchers agree with Espenshade that unauthorized Mexico-to-US migration is likely to rise in 1995. Both UCSD's Wayne Cornelius and University of Pennsylvania's Doug Massey, for example, report that in the Mexican villages from which most migrants come "bags are packed" for the trek north--stepped up border controls, they argue, are not likely to deter migrants.

In a January 1995 survey, Cornelius found that 30 percent of the Mexicans questioned thought that "it was not at all difficult" to find a job as an illegal alien in the US, while 28 percent thought that it was "very difficult." Over 80 percent of the Mexicans interviewed by Cornelius had heard of Operation Gatekeeper, and 80 percent thought that it was now more difficult to enter the US, but over 70 percent of those who had worked in the US in recent years were thinking of migrating to the US in 1995.

INS Commissioner Doris Meissner on February 24, 1995 said that some of the undocumented immigrants being apprehended by INS agents have said they crossed the border because of plant closings or other job losses related to the peso devaluation.

Some Mexican researchers, on the other hand, argue that suddenly poorer Mexicans may not be able to finance the trip to the US. Jorge Bustamante, President of the Colegio de la Frontera Norte (COLEF), a Mexican research center in Ensenada, said the number might actually drop because the cost of traveling to the United States has increased by about 50 percent. In one report, the average cost of being smuggled from Tijuana to Los Angeles rose from about $300 to $450.

COLEF researchers monitoring illegal border crossings from Mexico report that, as a result of Operation Gatekeeper, aliens must often make four or five rather than just one or two entry attempts. However, there is no indication that the need to make multiple entry attempts has so far deterred large numbers of illegal entrants.

Cornelius emphasizes that so many migrants have left rural Mexico and settled in the US since 1986 that there is not much "migration potential" left in many traditional emigration areas. Moreover, settlement in the US has also reduced remittances to communities of origin, increasing the migration potential of those who remain.

There have been three major peso devaluations in the past 15 years, and each has produced a distinct migration response. In 1982-83, Mexico also experienced a sharp peso devaluation (70 percent), but much of the adjustment took the form of lower real wages in urban areas rather than open unemployment. In rural areas, it took 16 months of a cost-price squeeze on farmers to produce a significant increase in apprehensions.

In 1986-87, the US offered amnesty or legal status to practically any rural Mexican who had some US farm work experience. Because of US legalization, the mid-1980s peso devaluation was not associated with increased apprehensions in 1987.

In 1994-95, by contrast, Nora Lustig of the Brookings Institution notes that the adjustment seems to be taking the from of open unemployment in urban areas, as manufacturing and other firms announce bankruptcies and layoffs. Separations from good jobs seem to be concentrated in urban areas, while emergency programs to alleviate the effects of devaluation seem to be concentrated in rural areas. The Mexican government plans to temporarily employ 500,000 unemployed workers to build rural roads.

If more urban-origin migrants head north in 1995, then a new set of migration streams may be set in motion, promising more migration in the years ahead.

As the number of apprehensions along the US-Mexican border rose 38 percent to 118,000 in February 1995 in comparison to February 1994, US Border Patrol agents report that violence against them has increased. Seven of the nine US-Mexican Border Patrol sectors--San Diego and El Centro, California; Yuma and Tucson, Arizona; and El Paso, Del Rio, Marfa, Laredo, and McAllen, Texas--saw apprehensions rise (the Border Patrol divides US borders into 21 sectors). These stations had 3,750 agents--or 88 percent of all agents-- in September 1994.

Agents reportedly have more rocks thrown at them, encounter nails driven through boards to stop their vehicles, and often confront larger groups of aliens being smuggled into the US. Mexico has promised to expand its Grupo Beta, which seeks to eliminate border crimes committed against aliens, but not deter Mexicans from migrating illegally to the US, and to crack down harder on smugglers of aliens (coyotes).

The US and the Mexican governments have launched a three-part study of the magnitude, impacts, and solutions for unauthorized Mexico-to-US migration. The study was launched in February 1995, with Mexico and the US sharing its costs. The aim is to reach consensus at each phase of the study--numbers, characteristics, push-pull factors, impacts, and policy recommendations--before proceeding to the next phase.

Wayne Cornelius, "Impactos potenciales de la nueva ciris economica sobre la migracion a Estados Unidos," Nexos, May 1995, available in English or Spanish on request to; Sandra Sanchez, "Border Patrol Fighting Pitfalls of Success," USA Today, March 28, 1995. Scott Pendleton, "Border Arrests Increase as Peso Spurs an Exodus," Christian Science Monitor, March 10, 1995. Pamela Burdman, "INS Says Peso's Fall Being Felt at Border The San Francisco Chronicle," February 24, 1995. John Hiscock , "Britons caught in American purge on illegal workers," 1995 The Daily Telegraph, February 27, 1995. Border Control: Revised Strategy Is Showing Some Positive Results (GAO/GGD-95-30, Dec. 29, 1994).