Money sent to the Mexican homeland by U.S. immigrants is soaring, busting monthly records as that country and its economy continue to struggle with the coronavirus pandemic.
This year for the first seven months, through July, the flow hit $28 billion, up nearly 24% from the same period last year, according to Mexico’s central bank. This past July, the flow of money known as remittances hit $4.54 billion.
What’s the driver?
Family ties during a time of need of the prolonged COVID-19 pandemic, say experts from the think-tank gurus to Dallas homemakers and construction workers.
“The ties of family are very deep for Mexicans and those ties don’t seem to fade, even … after a decade or two,” said Andrew Selee, president of the nonprofit Migration Policy Institute.
There are about 11 million foreign-born Mexicans in the U.S. and nearly 60% arrived more than 20 years ago, according to MPI. A large portion are here legally, Selee noted. About half of the Mexican foreign-born population is estimated to be in the U.S. lawfully and the rest is estimated to lack proper documentation.
The U.S. economy bounced back faster after the coronavirus slump and that rippled through the more established Mexican immigrant community of the U.S., Selee said. “Mexican immigrants in the U.S. have greater capacity to send money back home because they are working, and their families still aren’t,” he said.
“Mexican immigrants have remained remarkably consistent in sending remittances, even after they’ve been in the United States a decade or two,” Selee said. But at some point, Selee said, financial obligations will ebb for the established Mexican immigrant families.
The increased flow to Mexico and to other Latin American countries with high migration to the U.S. is “simply historic,” says Manuel Orozco, a remittance expert at Creative Associates International. Guatemala, Honduras and El Salvador have all had remittance increases of 25% to 30% this year. In a survey called “A Commitment to Family,” the Inter-American Dialogue research center found optimistic expectations of generosity among 1,100 immigrants from eight countries. But that has been exceeded by the results, Orozco said.
Some money could be sent south to pay off debts to coyotes — human smugglers — Selee theorized.
“At this point, I’m not sure how many Mexicans still use coyotes to try and cross,” Selee said. “They probably do, but Mexicans have greater familiarity with crossing the border and much more family and community intelligence about this.”
Myrna Mendez of Dallas is symbolic of the many Mexico-born immigrants sending money back to family in Mexico. She attributes the remittance increase to the pandemia. “This pandemia is something we haven’t ever lived through,” Mendez said in Spanish. “They say tighten your belt and help.”
And so she does.
Thanks to technology, sending money to an ailing brother in northern Mexico is even easier. Sums can go as high as $500 when there are medical expenses for her family. Her own family in Dallas lives from the wages of her husband, a construction worker with steady employment in the relatively healthy North Texas economy.
“We are blessed to bless others,” says Mendez, who has been in the U.S. for more than 25 years and is now a U.S. citizen.
Construction worker Ruben Salinas said work for immigrants, documented and undocumented, in North Texas is booming. That’s pumping up the flow of money to Mexico and countries like Honduras, Salinas said.
“The majority of factories and companies are employing thousands of immigrants and they aren’t sufficient,” said Salinas, a Mexico-born construction worker who sends money south to family in the state of San Luis Potosi. That’s meant pay jumps from $10 an hour to as high as $20 for construction workers, he said.
That’s meant jumps in remittances, or remesas as they are called in Spanish. Salinas believes immigrants on average send $500 a month and in these good economic times in Texas, the flow can be as high as $1,000.
“They are sending because there is so much work here,” Salinas said. “The work here is excellent.”
This past July, unemployment in the Dallas-Fort Worth area sunk to 5.3%, from the pandemic high of 12.5% in April 2020, according to the Bureau of Labor Statistics.
Texas is home to the second largest population of Mexico-born immigrants and the state is also the base for the second highest flow of remittances.
The pandemic has hit the Mexican economy harder than in the U.S., said Jennifer Apperti, the manager of the Mission Foods Texas-Mexico Center at Southern Methodist University.
“Sadly, a lot of people lost their jobs during COVID-19 in Mexico,” Apperti said. “And some people have been increasing the amount of money sent to families back home to help ease the situation.”
On average in July, there were 11.6 million persons who sent money to Mexico at about $390 each transaction. Increased use of electronic payment systems like PayPal makes easier for new generations to send money home, she said.
“Having grown up seeing a lot of tragedies like natural disasters, earthquakes and flooding, I feel like in times of great need people tend to pull together to help each other out,” said Apperti, who holds both U.S. and Mexican citizenship.
Apperti also noted that research done for the Texas-Mexico Center showed that an additional increase in remittances may have come from the Mexican peso weakening against the dollar during February through April. That means a U.S. dollar stretches further in Mexico.
Salinas, the Dallas construction worker, agreed. “When the peso rate is above 20-to-1 dollar, many people start to send more,” he said. “The dollar is being valued more.”
This story was corrected on Sept. 5, at 4:45 p.m. An earlier version incorrectly identified Southern Methodist University, as Southern Methodist Center.
