Shopping Cart: Comparison between the US and Mexico

Soriana is Mexico’s Wal-Mart. It sells everything from Mexican soccer team jerseys to eggs to mangoes to shampoo. While in Mexico last week, we went through the Soriana and recorded the prices of items that are commonly found on a very basic shopping list for a Mexican family of four. The analysis below considers these prices in relation to the income of a Mexican family whose primary breadwinners make minimum wage working in a maquiladora. Minimum wage is 57 pesos for an 8 hour day of work, or about 7 pesos an hour. The conversion between pesos and dollars is about 12.80 pesos for one dollar. This means that a maquiladora worker makes about 4.45 US dollars a day or 55 US cents an hour.

The first column of the table found at the top of this post lists the contents of a basic weekly shopping cart for a Mexican family of four. The second column in the table indicates the price in pesos of each product. The third column calculates the equivalent price in US dollars given an exchange rate of about 13 pesos per 1 US dollar. The fourth column calculates the number of hours a maquiladora worker would have to work in order to make enough money to be able purchase each product. This column was calculated by dividing the cost of each product by the hourly wage of 7 pesos. The final column indicates how much the product would cost in the US (in dollars) given that minimum wage is roughly 7 dollars an hour. It was calculated based on the number of hours a Mexican employee must work to pay for each product.

Example of calculation for beans:

Beans cost 15 pesos a kilogram.

15 pesos/13 pesos = 1.15 US dollars for a kg of beans.

Number of hours a maquiladora worker must work to buy a kg of beans = 15 pesos/hourly wage of 7 pesos= 2.14 hours.

Equivalent cost in US = number of hours a Mexican worker has to work to buy the beans in Mexico times the minimum wage in the US = 2.14 hours x $7 = $15 for a kg of beans in the US.

The same calculation was repeated for each column.

A Mexican family of four with two parents who work 8 hours a day five days a week in a maquiladora earning minimum wage, make 570 pesos a week. The shopping list in this survey indicates that food alone would cost this family 567 pesos a week. A single working parent would not be able to afford the contents of this minimal shopping cart.

With US dollars purchasing power, a US citizen could go to Mexico and purchase this shopping list for only $43.65. If prices are converted to equivalent prices in US dollars, though, the cost of this shopping list in US dollars goes up to 567 dollars, a price way beyond what US families would be willing or able to pay for food.

The result of these high prices is that many families in Mexico cannot afford a sufficient and well rounded diet. Many children suffer from malnutrition and anemia. There are organizations that provide children with at least one full meal a day, but there aren’t enough. The cost of food locks many families in to an inescapable poverty.

While in Mexico last week, we met two cousins about to walk through the desert to pick strawberries in California. We met a mother of three girls who couldn’t bear to watch her daughters suffer from hunger any more. We met another mother who told us: I can’t imagine a worse feeling in the world than watching your kids cry from hunger and having nothing to give them. People risk their lives in the desert coming to the US because they cannot afford to pay for food for their families in Mexico. The choice for many is between the following: risk dying in the desert to get to the US where you can make enough money to feed your family back in Mexico or stay in Mexico and watch your family die of hunger. It should not be surprising that so many choose the former.

It is clear that something needs to be done. Wages need to be raised or the cost of food needs to be decreased, so that people can feed themselves and their families without having to leave them behind in order to do so.