In times past, Canada was the main supplier of manufactured goods to the US. Particularly when it was experiencing slow economic growth, a weak dollar, and low oil prices (as it is currently), Canada was the most attractive place for American manufacturers to send their work.

Not so anymore. Over the past 20 years, companies have begun to favor Mexico over Canada, and as a result, Mexico is the new king of manufactured goods. In fact, since 2008, Mexico’s non-oil exports have increased by 50%, whereas Canada’s have dropped by 10%.

Mexico’s new-found manufacturing status can be traced back to a shift in government policy. In the late 1980s and early 90s, Mexico underwent an economic transformation designed to open up its economy and encourage industrialization and exports.

As part of that transformation, Mexico negotiated 11 separate free trade agreements—more than any other nation on earth. Involving 44 countries, these agreements give Mexico duty-free access to almost 60% of the world’s economic output! As a result, Mexico’s global exports soared by almost 500% between 1994 and 2011.

Moreover, Mexico’s sinking peso, low wages, and low energy costs with respect to China have combined to make it an ideal place for manufacturers to set up their business.

Hiring Challenges

As appealing as it is, there’s no doubt that the trend of setting up manufacturing in Mexico will continue. That of course means a demand for skilled labor to maintain plants, but North American companies have found it challenging to hire staff with the necessary skills. In fact, in 2015, Mexico was cited as one of the top ten countries having difficulty filling skilled positions.

In a global survey of 42,000 hiring managers, 54% in Mexico have reported difficulty finding staff with the right skills (compared with the global average of 38%). In particular, companies are desperate for skilled trades, engineers, machine operators, and technicians, which is notable because these are exactly the people required to maintain complex machinery of the type found in manufacturing plants.

The talent shortage, as it is called, is a very real problem for manufacturers who want to set up in Mexico. One way around it, of course, is training general maintenance workers to solve the complex electrical problems that can bring production lines to a halt.

The Language Barrier

There is another factor that complicates matters still more: the language barrier. Most of the North American staff that could train new hires in Mexico are English-speaking, but English proficiency in Mexico is very low. (According to the English Proficiency Index, Mexico ranked 40th out of 70 countries surveyed.)

So how can companies moving to Mexico (or any other Spanish-speaking country) equip new employees with the necessary skills in their native language, in an efficient and cost-effective manner?

Simutech Multimedia

Simutech’s Troubleshooting Skills Training System™ is a software training solution for both the lack of skilled labor in Mexico, and the need to train employees in Spanish. Simutech’s practical, simulation-based software training program equips electrical workers and general maintenance staff with the skills they need to troubleshoot electrical problems and reduce costly production line downtime.

The modular training software teaches employees a systematic, methodical approach to electrical troubleshooting, providing users with theory, practical experience, and skills testing in a safe, simulated environment.

Now Available in Spanish

And now, in response to customer demand, the Simutech program is being translated into Spanish! In the spring of 2016, the first course of program (Troubleshooting Electrical Circuits [TEC]) was released in Spanish, and by the fall, the complete Spanish program will be available.

Companies that want to set up manufacturing in Mexico need no longer worry about the labor shortage or the language barrier—with Simutech’s Troubleshooting Skills Training System™ new employees can be trained efficiently, effectively, and safely, in their own language.

Sources:

  1. “How Mexico’s manufacturing sector is eclipsing Canada’s.” Canadian Business. Sept. 9, 2015. http://www.canadianbusiness.com/global-report/how-mexicos-manufacturing-sector-is-eclipsing-canadas/
  2. “Mexico’s Manufacturing Sector Continues to Grow.” Forbes. April 8, 2015. http://www.forbes.com/sites/stratfor/2015/04/08/mexicos-manufacturing-sector-continues-to-grow/#283cf7823c9e
  3. M. Angeles Villarreal. Mexicos Free Trade Agreements. Congressional Research Service. 2012. https://www.fas.org/sgp/crs/row/R40784.pdf
  4. Why GM Will Make the 2016 Cruze in Mexico. Forbes magazine. April 14, 2015. http://www.forbes.com/sites/greatspeculations/2015/04/14/why-gm-will-make-the-2016-cruze-in-mexico/#2a141f837247
  5. Peter Coy. “Four Reasons Mexico Is Becoming a Global Manufacturing Power.” Bloomberg Business, June 27, 2013. http://www.bloomberg.com/bw/articles/2013-06-27/four-reasons-mexico-is-becoming-a-global-manufacturing-power
  6. George Friedman. “The PC16: Identifying China’s Successors.” Stratfor. July 30, 2013. https://www.stratfor.com/weekly/pc16-identifying-chinas-successors
  7. Manpower Group, “2015 Talent Shortage Survey.” http://www.manpowergroup.com/wps/wcm/connect/408f7067-ba9c-4c98-b0ec-dca74403a802/2015_Talent_Shortage_Survey-lo_res.pdf?MOD=AJPERES&ContentCache=NONE
  8. EF English Proficiency Index 2015. http://www.ef.com/ca/epi/regions/latin-america/mexico/
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