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Baja California’s Booming Economy

Baja California

Baja California

In the third quarter of 2011, Baja California recorded a 5.58% unemployment rate, the lowest along the U.S.-Mexico border.

This may seem great to Americans, but, historically, Baja California has averaged 1.5% to 2% unemployment.

The main factors that keep a low unemployment are public policies and the Baja California’s attractiveness for foreign and national investment.

After an economic crisis in 2008 and 2009, economic activity fell considerably, but in 2010 Baja California showed some recovery with the economy growing by 4%—something the United States should envy.

Baja California’s strong economy is due partly to growth in the manufacturing sector, commerce and services. Mexican government spending also stimulated the economy by building infrastructure such as hospitals, roads, sports and cultural centers.

Still, some sectors are lagging behind, mainly construction, which was affected by the U.S. mortgage crisis.

Agriculture, cattle ranching and the extracting industries—those that extract natural resources—have also slowed.

The tourism industry, including medical tourism has also slowed down.

But there seems to be an upside to these lagging indicators.

In the last few years Mexicali has lowered its dependence on the maquiladora (manufacturing) industry and grown in the service sectors. Before, the maquiladora industry represented 50% of the economy—now it represents only 27% of Mexicali’s economy.

In addition, the gas is only about $2.40 a gallon, poultry and beef are untainted by growth hormones and antibiotics, and housing is inexpensive.

Come on down!

Things are looking great for Baja California!

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