The industrialization of Mexico was centered in Mexico City, which until recently was the country’s principal manufacturing center. Table 3 shows the regional distribution of manufacturing employment in Mexico for the period 1930 to 1993. Mexico City’s share of the national manufacturing labor force rose from 19.0% in 1930 to 46.0% in 1960. Over that 30-year period manufacturing employment in Mexico City grew at an average annual rate of 6.7%, compared to 2.4% in the rest of the country (Garza, 1985).

Since 1980, industrial activity in Mexico has shifted to states on the U.S.-Mexico border, diminishing Mexico City’s role in the national economy. These developments have coincided with the opening of the Mexican economy to foreign trade and investment.

Region 1930 1940 1950 1960 1970 1980 1985 1993
Border 18.6 21.0 23.5 29.8
North 5.5 5.1 5.4 6.0
Center 21.8 22.9 27.6 27.4
Mexico City 19.0 24.7 25.0 46.0 47.3 46.4 37.4 28.7
South 6.8 6.2 6.1 8.1

Between 1980 and 1993, the share of national manufacturing employment in border states rose from 21.0% to 29.8%. Recent foreign direct investment in Mexico is concentrated almost entirely in the border region. The decline of the Mexico City manufacturing belt has been as dramatic as its rise. Between 1980 and 1993 the region’s share of national manufacturing employment fell from 44.4% to 28.7%, as employment in the region actually declined by 1.9%. Mexico’s new industrial centers are located in northern cities such as Ciudad Juarez, Monterrey, and Tijuana, which are physically close to the United States. finance