The Sociodemographic Effects of the Crisis in Mexico

Chapter Four: Survival Strategies in an Era of Crisis Low Income Households in Mexico City Rodolfo Tuirán

Introduction

The sudden outbreak of the economic crisis in 1982, combined with adjustment policies, stabilization policies and structural reform that were put into effect in Mexico during the eighties has stimulated a good deal of interest on the part of scholars and researchers to find out about the social costs of the crisis, as well as about the responses on the part of households. It is important to know answers to some important questions. What impact has the economic crisis had on the well being of the Mexican family? Have living standards fallen proportionately to the fall in individual or family incomes? What measures have household units taken to try to cushion or counter the effects of the crisis?

This chapter is a report on research that attempts to answer these questions. It extends the results of studies done in Mexican cities such as Guadalajara, Oaxaca, Querétaro and Tijuana. These studies have provided us with good and varied data, which, despite their fragmentary nature lend support to general hypotheses that underlie this p[resent research. The Tracking Survey on Low Income Families' Food Budgets and Jobs in Mexico City[1] which has been run by the National Consumers' Institute since June of 1985 has provided the greater part of the data which are studied in this chapter.

The Macroeconomic Situation.

One can identify three clear stages in the recent history of Mexican economic development, (1) stabilizing development (desarrollo estabilizador), which lasted from the 1950s to the 1970s, 2) a period of shared development, one of transition and economic instability, with a severe recession from 1975-1977 with an oil-based recovery at the end of the decade, and 3) the deep crisis of the 1980s which broke out toward the end of 1982 and which has obliged the state to undertake a whole series of stability and adjustment programs, whose logic seems to point to the creation of a new model of accumulation, export oriented and involving a reduction in the activities of the state.

The crisis along with the successive application of programs of adjustment and stabilization has meant a reduction in the demand for labor, and a reduction as well in the proportion of GDP going to wages, as well as an accelerated drop in real wages. Mexicans have felt, as well, the weakening of the role of the state as the provider of basic services reducing its investments in those areas which directly affected the population, such a health education and housing.

Public Expenditure.

As a result of the policy of adjustment which was put into place after 1982, public expenditures went down by an average rate of 10 per cent per year between 1982 and 1988 (Cortés and Rubalcava, 1991b). Education was particularly affected: it had gone up from 140 to 181 billion (1980) pesos from 1980 to 1982, but by 1988 expenditures for education were only 88 per cent of what they had been in 1982. As a proportion of total public expenditure, they went down from 15 percent in 1980 to 11.2 percent in 1982, to 6.2 percent in 1988.

Expenditures for health and housing followed a similar pattern; as a proportion of all public expenditures, health and housing accounted for 2.1 percent in 1980, 1.4 percent in 1982 and 1.0 percent in 1988.

The severity of the adjustment policy reduced the coverage of national health programs. The construction of hospitals and clinics was effectively suspended, as were the enlargement and remodeling of those that already existed. In the national hospital system of the Mexican Institute of Social Security (IMSS), reductions in such things as hospital beds, operating theaters, clinics, doctors and nurses all declined (de la Peña, 1990). At the same time the number of patient treatments increased from 1400 to 1633 per thousand subscribers. In this way the health care delivery system had to respond to an increasing demand for medical services in the face of budget cuts, and reductions in personnel, equipment and facilities.[2]

During the years of the crisis there was a slowing in the rate at which school enrollments had been increasing at all ages, which is associated with the decrease in public investment in education, as well as the dramatic decline in wages. (Padua, 1990). From 1971 to 1981 the percent of graduates from primary school that go on to secondary education grew from 62.2 percent to 86.8 percent. But beginning in the school year 1982-83 the percentage leveled off at first, and then went down to 82.9 percent in the school year 1984-85, where it remained.

Employment.

The changes in the Mexican economy over the past decade had had a notable impact on the labor market. The gravity of the economic crisis which began in 1982, and the severity of the adjustment and stabilization programs put into place during the eighties decreased the ability of the economic system to generate new jobs in the formal sector. And this happened at the very time when the population in the employable age range was increasing rapidly as a result of the historically high fertility rates of two decades before. Drawing upon different studies one can see the effects of three closely linked phenomena:

a) the manufacturing sector lost its dynamism and was unable to absorb new entrants into the work force. This tendency was reinforced by the continuing rate of technological modernization of selected industries (automobiles and electronics), the closing of some uncompetitive plants, and bankruptcy of others because of lack of the demand for their products. The manufacturing sector has seen regional changes and changes in the composition of the work force, having been especially affected by the development of the maquiladoras, and other export-oriented activities. There have been strong regional effects from these changes, but the net result has been a reduction in employment in manufacturing.

b) Increased terciarization of the work force has taken place (Garza, this volume). In the decade 1970-80 the tertiary sector of the work force, for the first time in recent decades began to grow faster than the work force in the manufacturing sector. (See, for example, García, 1988; Oliveira and García, 1990b; Rendón and Salas, 1989, 1991a, 1991b). In the eighties this tendency increased; according to Rendón and Salas (1991b), in 1989 commerce and services accounted for two thirds of total employment and more than one half of employment in the formal sector.

c) the process of formalization of the work force leveled off, and began to recede. Brígida García (1988) reports a decrease in the formalization of the work force in the seventies. More recently, Rendón and Salas (1991b) indicate that the period 1985-89 saw a marked increase in the number of firms, but a reduction in their average size. There is some evidence that the process of deformalization and downsizing were not just statistical artifacts. As Rendón and Salas report (1991b:23) "eighty percent of the employees hired before 1985 had formal jobs, while only 44% of the jobs were formal in 1989."

The changes in employment in the modern sector were not consistent during the period, but went up and down in accordance with the overall rate of economic activity. The records of the Social Security Institute (IMSS) indicate that the number of both permanent and temporary (eventual) workers with social security began to go down in 1982, and continued falling in 1983. Unskilled temporary workers were to first to fall. At first the formal sector was able to hold its own, and through 1985 it was able to absorb more workers, only to find that their numbers declined in 1986 and 1987. The major metropolitan areas of the country were the most affected, as well as the cities where there was a good deal of either heavy industry, or production of consumer durables. The agricultural areas were less affected, as were those areas were nondurable goods were produced. (Samaniego, 1990)

In line with a reduction in formal sector employment, the country experienced an increase in informal sector workers. (Mertens and Richards, 1987; Jusidman, 1989; Samaniego, 1990).[3] The length of the contraction and the absence of unemployment insurance helps explain the rapid expansion of the informal sector a well as the relatively low rates of open unemployment that were experienced during the period 1983-87.[4] The official rates published by CEPAL indicate that Mexico underwent a drastic restructuring of employment . [5] The reasons for the expansion of the informal sector included the following: 1) workers were being fired from jobs in the formal sector, 2) workers were compelled to moonlight in the informal sector because of the loss of value of real wages, and 3) new entrants to the work force could not find formal sector employment.

Many commentators have noted that the drop in the value of wages encouraged both women and children to enter the work force. (González de la Rocha, 1986, 1987; de Barbieri and Oliveira, 1987; Pacheco, 1988; García and Oliveira, 1990a). In the past decade the increase in female participation which had been documented from the 1970s in some sectors like homework, began to take on a new profile. For the first time factors like having children which traditionally had inhibited entry began to lose their force. (García and Oliveira, 1990b).

Wages

The abrupt decline in the value of wages is another distinguishing characteristic of the crisis of the 1980s, since they were the most important determinant of the decline in the conditions of social reproduction of the work force. As I noted earlier, from 1977 the Mexican government followed policies aimed at systematically reducing wages: and wages at first declined slowly, but after 1982 they dropped dramatically, and as a result of this policy, by 1986 the urban minimum wage was only 43 percent of what it had been in 1976, in real terms, and 60 percent of what it had been in 1980. This decline did not affect all branches of the economy in the same way. Between 1981 and 1986 average wages in the electrical sector fell 45 percent, while in construction the decline was 38 percent and in manufacturing as a whole it was 33 percent (Rendón and Salas, 1989).[6] These different rates of decline led to sectoral homogenization, so much so that Cortés and Hernández Laos (1990:290) were able to report that among social security members "wages had tended to be more equitably distributed between 1982 and 1986 even though everyone suffered declines, which tendency was consistent with the strategy of the export oriented model of development."

In order to appreciate the loss of purchasing power in Mexico, it is useful to real wages to the costs of the typical market basket for the family. Using the compositions of the Canasta Normativa de Satisfactores Esenciales (CNSE) as defined by the government agency COPLAMAR, Botvinik (1989) estimated the price of both the CNSE and the Canasta Normativa Subminima (CNSM) which includes only the subtotal for food, housing, health, hygiene and education. By comparing the costs of these market baskets with the minimum wage Botvinik could identify three periods, which were clearly different:

1. Between 1963 and 1977 it the number of minimum wages required to purchase the CNSE fell from 3.4 to 1.6, while the number to purchase the subminimum CNSM fell from 2.3 to 1.0.

2) Between 1978 and 1982 the number of minimum wages required for both increased, but only slightly from 1.6 to 2.8 in the case of the CNSE, and from 1.0 to 1.1 in the case of the subminimum CNSM.

3) From 1983 to 1987 the number of minimum wages required for both baskets rose quickly so that by August of 1987 3.5 minimum wages were needed to purchase the CNSE, and 2.0 to purchase the CNSM, which put the households at the same level they were at in 1983.

Changes in the Poverty Line and in Marginalization

Another way of appreciating the effects of the crisis and of the programs of stabilization and adjustment is to see how many families dropped below the poverty lines defined by the CNSE and the CNSM. I will call households whose total wages were insufficient to purchase the CNSE "poor", and those who were unable to purchase even the CNSM, "marginalized". One can, as Hernández Laos (1991) has done, estimate the number of households in conditions of poverty and marginalization in different moments of the period 1963 to 1988. Using the information derived from the survey of incomes and expenses (Ingresos y Gastos) Hernández Laos maintains that:

1) With the advent of the crisis there was an absolute increase in the number of households below both poverty lines, as well as a percentage increase. According to the figures of Hernández Laos, in 1981, 52.5 percent of the households were below the poverty line, while in 1984 this figure had increased to 62.0 percent and it was 62.5 percent in 1988, while the absolute number of households increased from 6.9 million in 1981 to 10.9 million in 1988. The percentage of households in the marginalized group also increased from 30.9 percent in 1981 to 34.8 percent in 1984 with a slight drop to 32.4 percent in 1988. In absolute numbers, the marginalized households increased from 4.0 million in 1981 to 5.7 million in 1988.

Income Distribution

Other studies, using other methods, have arrived at the same conclusion, i.e. that the poverty had increased during the 1980s. (Botvinik, 1989). Measures of the inequality of income distribution, like the Gini coefficient, have been surprising, for they show that this index did not change in the period from 1977 to 1984. [7] Many analysts have assumed that the program of stabilization of adjustment would lead to increased inequality in income distribution from 1982 on. But the measurement of the inequality has shown that no increase is to be noted. On the contrary, Cortés and Rubalcava (1991a:11) maintain that this surprising stability is owing to the fact that "the change in household income distribution not only register the effects of official policy but also the strategies of the householders who attempt to offset their losses. These are two opposite tendencies, one which tends to concentrate income, and one which tends to increase total income through the householders' efforts."

Households did suffer a decline in total income during the period, an 11.6 percent drop from 1977 to 1984 according to the estimates of Hernández Laos (1991), but the tactics employed by the lower income strata tended to offset some of their wage losses, more so than in the middle and upper strata. This has led Cortés and Rubalcava to conclude that "the relationship between higher incomes and greater concentration, which was characteristic of the period of stabilized development has given way too a period in which lower incomes are associated with unchanging inequality.

Household Strategies in a Time of Crisis

The importance of social expenditures, employment and unemployment as well as wages, and the study of the way they fluctuate over time derives from the key role that they play in the process of the reproduction of the labor force. As is well known, the maintenance of workers and their families depends on 1) the availability of employment and the wage levels, which determine the quantity and quality of the goods that can be purchased in the market; 2) the set of activities that are performed in the household from the purchase of commodities to their transformation into consumption items; and 3) the availability of services provided by the state to the household in the areas of education, health, social securities as well as the subsidies that reduce the prices of basic consumption items (productos básicos) (De Barbieri and Oliveira, 1987). The available evidence shows that both the services and the subsidies were reduced during the crisis years, with consequences for the social relations of the community, as well as on the will of community members to mobilize themselves for political action.

In the sociodemographic literature it has been argued seriously that domestic units tend to organize strategies to confront phenomena like unemployment, falling wages, and falling family incomes. In the literature the claim is made that the survival tactics of the householders is able to offset the deterioration in welfare caused by the recession of the eighties and the policies of stabilization and adjustment. As Cornia (1987) has stated, "many of these strategies, and probably the majority of them are not new, and many poor people have adopted them throughout their lives. Still, it is clear that families will have recourse to them during periods of general economic crisis". Under these circumstances, some of these strategies may well function to cushion the effects of the ,re difficult living conditions. Many analysts have questioned the use of the term "strategy", interrogating its suitability for this discussion. Some have discussed the many ambiguities and paradoxes that the use of the term implies, such as Argüello, (1981), Escobar and De la Peña, (1990), González de la Rocha, Escobar and Martinez (1990), Selby, Lorenzen, Murphy, Morris and Winter, (1990). Many of the studies that have used the concept have placed an exaggerated emphasis on the capability of the domestic group for rational adaptation, as well as in the supposition that there exists an active form of solidarity among its members. It has been argued, for example, that this line of argument has placed too little emphasis on the analysis of conflict within the household, as well as conflict in work relations and the labor market. (González de la Rocha, Escobar and Martinez, 1990). As Escobar and De la Peña have stated "the inhabitants of the country have not been passive victims of the 'crisis', inert objects dragged under by waves of migration, buffeted by the vicissitudes of an erratic labor market, and the inadequate and unjust provision of services."

In this section we propose to present some findings about the nature and effectiveness of the strategies deployed by low income households in Mexico City in an attempt to sort out the effects of the crisis. It is convenient to use the classification of households set out by Cornia (1987:114-127) who assigns the strategies to three categories: 1) strategies aimed at the acquisition of more resources; 2) strategies to increase efficiency in the use of available resources, and 3) strategies that involve changes in the structure, composition and organization of the family.

Acquiring New Resources

This kind of strategy has as its purpose the protection of a given level of household income (in money and in kind), or if not its maintenance, then the minimization of income reductions so as to enable consumption to satisfy the basic needs of the family (Cornia, 1987). With this purpose in mind, it can happen that households seek to intensify their labor force participation rate putting different members of the household into the work force and making new arrangements for household duties; all subject to the demographic characteristics of the household, the prevailing division of labor by sex, and the availability of paid employment in the local labor market. In order to increase the number of members in the work force households not only inserted adult men, when they were available, but also women in all stages of the domestic cycle, as well as the children and old people in the house. And, at the same time, household members held down two or more jobs, or combined their formal jobs and own-account work they did on the side, or they simply worked harder for longer hours.

There is a consensus on the fact that low income households put more members to doing tasks that earned money, thus obliging a contribution from all to the satisfaction of the basic needs of the family. But this was not true in all sectors of the society. According to Cortés and Rubalcava (1991b:21) in the middle and middle to upper income groups "the decline in the value of wages and salaries was as great as indicated by the fall in value of the minimum wage, which could indicate that these social group did not follow to strategy of increasing participation in the work force. And this was due to the fact that they could absorb their income losses without affecting basic consumption patterns." But as the crisis dragged on year after year, they exhausted their financial reserves, and as Cortés and Rubalcava note "they increased their informal activities to offset the reduction in income and took up activities like: selling fancy cakes and pastries, sweets, bows and the like which were produced by the wives and daughters of these families, as well as engaging in selling fine jewelry, clothing and shoes among their friends. The increase in these commercial activities was noted in the proliferation of garage sales in all the major cities of the Republic, which were attended even by professional people.

In Table 1 I have noted the index of labor utilization (by sex) of the households for the years 1982 and 1987[8] for the country as a whole. I register the percentage of households that use none of the males or females in a given age category, and the percentage that uses all of them. The first result to be noted at the national level is the high percentage of males ages 18 to 44 and 45 to 64 in the work force. There is little change from 1982 to 1987. This is not true in the younger ages from 8 to 17, where there is a marked increase from 1982 to 1987 in the participation rate for children and adolescents. In Table 1 one may note that even though the work force participation rate of women is decidedly lower than that of men, there have been considerable increases in the adult age groups, from 18-44 and from 45-64, and increases of a lesser degree among children and adolescents.

[Table 1 goes in here]

Similar patterns can be seen in the mostly rural communities of under 20,000 inhabitants, the urban communities of more than 20,000 inhabitants, and in the metropolitan sites. [9] It is worth while pointing out that households in cities with a very different productive and occupational structure like Oaxaca (Selby et al., 1990), Tijuana (de la Rosa, 1990), Guadalajara (González de la Rocha and Escobar, 1989) Velasquez and Arroyo, (1991) and Mexico City (Jusidman, 1989) have faced the crisis making inserting more members into the work force.

In order to evaluate the results of this family strategy, a governmental organism the National Institute for Consumer Affairs (INCO: Instituto Nacional del Consumidor) undertook from 1985 the Tracking Study of Food Consumption and Jobs in the Lower Income Population of the Metropolitan Area of Mexico City (Seguimiento de la Situación Alimentaria y Ocupacional de la Población de Bajos Ingresos en el Area Metropolitana de la Ciudad de México). They have completed four panels at the time of writing. Each panel consists of six interviews; at the end of the sixth interview the wave is considered complete and another household is chosen. In this paper I will use the information from the first panel; the households were interviewed in June of 1985 to February of 1988, the period during which a dramatic decrease in wages occurred. The households were selected by random sample and were subdivided into five strata according to two criteria: the sector (formal or informal) of the job of the head of the household, and three different income levels. The stratum "low income-formal" includes domestic units with incomes between 0.8 and 1.5 minimum salaries. The stratum middle income-formal includes households with incomes between 1.5 and 2.5 minimum salaries. The stratum upper middle income-formal includes households which earned between 2.5 and 3.5 minimum salaries. The stratum low income-informal includes households with incomes from 0.8 to 1.5 minimum salaries, while the middle income-informal households have incomes of between 1.5 and 3.5 minimum salaries. The sample is representative of the low income population of the area.

The results which came out of the first panel of the study are extremely interesting. They agreed with a large number of indicators and other data which will sustain some general hypotheses. According to the data from the INCO surveys, the incomes of the heads of households of all strata declined between June 1985 and February 1988. (See Table 2). Household heads in the formal sector and in the low-income-informal stratum did not fare as badly in terms of real decline (8, and 2.2 percent respectively). The decline was particularly severe in the middle income-formal and the middle income-informal strata. The behavior of wages of the head of the household is consistent with the tendency mentioned already of greater equity in income distribution. (Cortés, Hernández Laos and Rubalcava, 1990).

[Table 2 goes in here]

Table 2 also shows that the most common strategy employed by all strata to offset the decline in individuals' wages was the insertion of more household members into the work force. This pattern is more marked in the low income groups, as well as in the middle income informal stratum. The majority of these new entrants are women, although the incorporation of women into the work force is not as marked in the upper middle income (both formal and informal sector); but these were the very sectors with the highest rates of female labor force participation in 1985.

The increase in the number of wage earners came about principally through the incorporation of household members in unstable or casual labor, as in Table 3. This occurred mainly in the lower strata (low income formal, middle income formal and low income informal), and did not occur in the upper middle income formal or the middle income informal, who were earning up to 3.5 minimum salaries. The upper income formal group (2.5-3.5 minimum salaries) did not increase the number of members in the work force nor its occupational profile. The middle to upper income informal group did undergo changes: they moved from unstable employment to stable employment.

[Table 3 goes in here]

During the period it is worth noting that the number of men in stable occupations remained unchanged, and the increased employment of men took place in the unstable occupations, except in the middle and upper informal stratum. Women, on the other hand, increased their employment in unstable jobs, especially the new entrants from the less well off strata. (See Table 3).

The index of utilization of the work force in stable and unstable jobs confirms these findings, and at the same time permits us to quantify the proportion of households in each stratum involved in these changes. (Table 4). For example, it is estimated that around 72 percent of the low income formal households deployed all or almost all their available men into stable jobs in June, 1985. But, by February, 1988 only 43 percent of the households did. The same happened in the upper middle formal stratum: where the percentage went down from 50 percent to 23 percent during the same period. Contrarily in the lower income formal one does not observe a linear relationship over time, but ups and downs, albeit with a downward tendency over the period (Table 4). The decrease in these strata was not offset, initially, by a increase of the rate of insertion of men into unstable jobs. It wasn't until August of

[Table 4 goes in here]

1987 that one saw this tendency assert itself. In contrast again, the increased insertion of women from the low and middle income formal groups into both stable and unstable occupations was marked, while in the upper middle formal stratum the increase was not marked at all. (Table 4).

As a result of the increasing insertion of women into the work force, the contribution of women to the family income increased considerably during the period in question. If one examines the data on the contribution of wives of head of households, one notices immediately that there is a considerable reduction in the percentage of households reporting "no contribution" from the housewife ("ama de casa") as well as increases in the number contributing 26 percent or more.[10 ] This is particularly clear in the low-income formal, middle income formal and low income informal strata.

The incorporation of a greater number of household members into the work force, translated into a higher producer/consumer (dependency) ratios, as can also be seen in Table 5. A more detailed analysis of the data not included in the table shows that households were able to maintain current levels of income up to from June to November 1985, while in 1986 households with heads in the formal sector suffered to a much greater degree than those with heads in the informal sector. Throughout the period 1985-1988 low-income formal households, and middle to upper income informal households did better in getting through the crisis than the other strata. In these households the income losses were more than offset between June of 1985 and February of 1988 by income earned by other members of the household. The low and middle income formal sector strata only suffered a slight income loss during the period while the middle to upper income informal stratum actually recorded significant increases, only finally suffering losses in the last period, February, 1988. The middle income formal sector households kept their dependency ratios at the high levels of previous years, and as a result suffered rather badly so that by February 1988 their income had fallen 19 percent below the levels of June 1985. Per capita incomes had their ups and downs but, except for the low income informal sector households, everyone lost ground by February 1988.

[Table 5 goes in here]

One can add that family income derived from members with stable jobs fell significantly from November 1985 in all strata of the formal sector. This fall was offset in the low income stratum by the insertion of more workers into unstable jobs (Table 5). In contrast the middle and upper middle formal sector strata were unable to increase their incomes by this route, and indeed suffered losses. The informal sector strata are quite different from each other: the low income informal stratum gained income by putting household members into unstable jobs, while the upper middle informal stratum lost ground. This last stratum did well from inserting their members into stable occupations, unlike the other strata.

The nature and effectiveness of these strategies are intimately related to the stages of development of the domestic group in the domestic cycle (García, Muñoz and Oliveira, 1982; González de la Rocha and Escobar, 1989) have all shown that the stage of the domestic cycle has an important influence on the availability of members to enter the work force. The INCO surveys affirms earlier results that households in the earliest stages of development when there are small children, and in the most advanced stages, when the children have left the household are least able to put into place a strategy based on the intensification of labor force participation. The only households who were able to increase their incomes during this period were those with older children between the ages of 13 and 18, but, surprisingly, part of the income increase was derived from the head earning income outside his regular job.

Strategies for Increasing Efficiencies in Consumption.

Lastly we examine what Cornia (1987:123) has called "strategies aimed at preventing a deterioration of family welfare from a decrease in household income". The situation of the households in this regard depends on two factors: their socioeconomic position before the onset of the crisis, and the stage they are in of the domestic cycle. Here we examine the way in which households changed their global patterns of consumption, their purchasing habits, as well as the way the prepared and shared food within the family.

The information that we have suggests that the decade of the 1980s has seen a complete restructuring of expenditures in low and middle income households. These differences are to be seen both by stratum, as well as by region, with the north being able to maintain former patterns better than Central Mexico, and much better than in the southern regions of the country (de la Peña, 1990). The data show that the middle income sectors have followed the strategy of reducing consumption, cutting off avoidable purchases and services such as the purchase of sophisticated prepared foods, cosmetics, personal items, gifts, clothing, and restaurant meals. In the low income sectors the pattern was quite different, since in these groups the are very few expenditures that can be cut without seriously affecting household welfare.

In sites like Guadalajara the working class has managed to maintain their patterns of consumption to some extent. According to data from a panel study of low income families in this city, expenditures for food only declined slightly. However expenditures for education, and health feel alarmingly (González de la Rocha and Escobar, 1989). In low income households in Mexico City, a surprising process was set in motion: average weekly food expenditures and expenditures for food as a percentage of the family budget fell together. In the low income formal stratum, for example, the percentage of the household budget going for food fell from 68 percent to 46 percent between June of 1985 and February, 1988, while among middle and upper middle formal strata the percentage decline was less, from 48 percent to 37 percent in the first and from 40 percent to 37 percent in the second. Similar figures for the informal sector were from 60 percent to 45 percent for the low income informal sector households, and from 45 percent to 38 percent for the middle income informal group. We do not have information that would allow us to explain this change, but we note that it runs against the traditional hypothesis that as income falls, the percentage of the household budget spent for food increases.[11]

All strata tried to organize their consumption in order to obtain the maximum benefit from their expenditures. One notices especially a reduction in the consumption of meat and milk products and an increase in the average number of persons in the economically active age ranges. This data coincides with the reported increase in the frequency of extended households during the crisis (Selby, this volume). In June of 85, the INCO data revealed that there were only 17.8 percent of all households, but by November 1985 this figure had risen to 27.4 per cent, then in August 1986 to 30.9 percent, and finally by February of 1988 it had risen to 33.3 percent.

Many authors have suggested that the increasing percentage of extended households is because of the increased security that they afford to their members. However, the results of the INCO survey show that extended households with young children under the age of 13 years suffered a marked decline in income in 1986 with only a slow recovery after that date (Table 6 gives the figures for the beginning and the end of the period only), while households with older children, who would be putting more members in the work force saw the beneficial income effects which they enjoyed through 1987 evaporate by February 1988.

[Table 6 goes in here]

Conclusion.

The INCO data are extremely useful in permitting us to disaggregate the effects of the crisis in two ways. We can follow the impact over the different years and get a much more detailed picture of the ups and down of the period that we lump together in the term "crisis". Second we can see how the crisis made itself felt on different families in different economic and occupational niches in the economy.

It is data of this kind that will prevent any kind of revisionist interpretation of the crisis of he 1980s from making much of an impact in intellectual circles, and for this reason I hope it has been useful to present the data in this detailed form.

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González de la Rocha, M. and A. Escobar (1989) "Crisis y adaptación: hogares de Guadalajara." Memorias de la III^a Reunión Nacional de Investigación Demográfica en Mexico. SOMEDE, pp. 711-728.

González de la Rocha, M., A. Escobar and M. Martinez (1990) "Estrategia versus conflicto: reflexiones para el estudio del grupo doméstica en una época de crisis" in de la Peña G. et al. (eds.) Crisis, conflicto y sobrevivencia: estudios sobre la sociedad urbana en México. Guadalajara. University of Guadalajara/CIESAS.

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	TABLE 1
	Percent of HH Males & Females in Force
National Sample	AGES
Percent males in force	8-11	12-14	16-17	18-44	45-64
None (1982)	97.5	88.1	55.2	7.0	6.2
None (1987)	92.1	78.5	56.9	6.0	6.1
100% in force (1982)	1.9	1.05	31.6	85.5	91.5
100% in force (1987)	6.3	18.8	40.5	89.2	91.5
Percent Females in force
None (1982)	99.0	95.3	81.6	88.6	79.8
None (1987)	96.8	89.8	77.8	57.9	59.5
100% in force (1982)	0.9	3.5	15.3	21.5	19.4
100% in force (1987)	2.8	9.2	19.7	32.1	29.0

TABLE 2

Household Characteristics by Sector

		Wages		% of '88	Num in House		N Inc Earners
Sector		June '85	Feb '88		June '85	Feb '88	June '85	Feb '88
Low Income Formal		8,042.	7,402	92%	5.22	5.71	1.26	1.76
Middle Income Formal		10,770	9,185	85%	6.21	6.16	1.63	2.06
Upper Middle Formal		16,149	11,791	73%	5.61	6.24	1.93	1.97
Low Income Informal		5,937	5,805	98%	6.06	6.65	1.47	1.97
Middle Income Informal		8,933	6,967	78%	6.31	6.37	1.86	1.93

	TABLE 3
Number of Employed by Stratum, Stability of Occupation and Sex
Stratum	Stable Occupation	Unstable Occupation
		June 1985	Feb. 1988	June 1985	Feb. 1988
Low Income Formal		1.03	0.90	0.23	0.81
Middle Income Formal		1.16	1.22	0.42	0.66
Upper middle formal		1.41	1.37	0.43	0.53
Low Income Informal		0.58	0.54	0.85	1.38
Middle & Upper Informal		0.70	1.24	1.16	0.69
Number of Employed by Sex and Stratum (Men Only)
Stratum		Men in Stable	Men Stable	Men Unstab	Men Unstab
		June 1985	Feb. 1988	June 1985	Feb. 1988
Low Income Formal		0.94	0.12	0.12	0.40
Middle Income Formal		1.00	0.88	0.26	0.34
Upper Middle Formal		1.02	0.90	0.25	0.43
Low Income Informal		0.42	0.33	0.58	0.74
Middle & Upper Informal		0.42	0.72	0.82	0.48
Number of Employed by Sex and Stratum (Women Only)
Stratum		Women Stable	Women Stable	Women Unstb	Women Unstb
		June 1985	Feb. 1988	June 1985	Feb. 1988
Low Income Formal		0.09	0.19	0.12	0.40
Middle Income Formal		0.16	0.34	0.16	0.31
Upper Middle Formal		0.39	0.47	0.18	0.10
Low Income Informal		0.17	0.21	0.26	0.64
Middle and Upper Informal		0.28	0.52	0.34	0.21

				TABLE 4
Percent of Men and Women/ Household Employed in Stable and Unstable Jobs by Stratum
		MEN				WOMEN
		STABLE		UNSTABLE		STABLE		UNSTABLE
Stratum		June '85	Feb. '88	June '85	Feb. '88	June '85	Feb. '88	June '85	Feb. '88
Low Inc Formal
None		11.8	28.6	88.2	69.0	91.2	83.3	88.2	61.9
51% or more		73.5	42.9	7.4	19.1	0.0	4.8	5.9	14.3
Mid Inc Formal
None		11.6	26.0	76.7	75.1	86.0	65.6	83.7	71.9
51% or more		48.8	39.5	2.3	3.8	4.6	6.2	4.7	9.4
Upp-Mid Formal
None		15.9	26.7	79.5	66.8	85.9	63.3	84.1	90.0
51% or more		52.3	26.6	11.4	13.4	4.6	3.3	2.2	6.7
Low Inc Inform
None		60.0	73.0	40.0	36.1	84.9	82.1	77.4	43.6
51% or more		18.0	13.5	44.0	48.6	5.7	5.2	11.3	25.7
Upp-Mid Inform
None		64.6	46.4	33.3	50.0	74.0	55.2	70.0	82.8
51% or more		20.8	28.5	43.8	32.1	8.0	6.9	12.0	6.9

TABLE 5
Dependency Ratios, and Income Measures by Stratum
	Dependency Ratios		Income (All job types)		Family Income
Stratum	June '85	Feb. '88	Fam Inc[12

	]Per Cap Inc	Stable	Unstable
Low Inc Form	4.48	3.68	109	94	84	260
Mid Inc Form	4.34	3.32	97	99	90	104
Up Inc For	3.47	3.73	81	72	81	99
Low Inform	4.53	3.85	115	109	78	151
Up Mid Infor	4.03	3.85	96	93	160	50
Total	4.21	3.68	97	90	93	106

TABLE 6
Changes, Contributions of Real Income, Household Members (June '85=100)
Households with Children < 13 Years of Age
Income Source	Income 6/85	Income 2/88[13

	]% Change	% Contrib '85	% Contrib '88
Head of House	10,131	7,841	77.4	64.9	47.4
Housewife	1,433	4,213	294.0	9.3	25.5
Children	--	--	--	--	--
Other Kinfolk	4,029	4,477	111.1	25.8	27.1
Family Income	15,613	16,631	105.9	100.0	100.0
Households with Children > 12 Years of Age
Head of House	8,128	6,885	84.8	39.5	38.4
Housewife	1,681	1,058	62.9	8.2	5.9
Children	7,508	7,227	96.3	36.5	40.4
Other Kinfolk	3,240	2,737	84.5	15.8	15.3
Family Income	20,555	17,907	87.1	100.0	100.0

[1] La Encuesta de Seguimiento de la Situación Alimentaria y Ocupacional de la Población de Escasos Recursos del Area Metropolitana de la Ciudad de México.

[2] Information derived from field work indicates that during the period 1982-85 there was a resurgence of some infectious diseases in some parts of the country. This appears to be related to failures in the medical care system, as well as the deterioration of water quality, wear and tear in water systems and in insufficient power generation.

[3] According to the estimates made by CIEMEX-Wharton, formal employment in 1986 was practically the same as it had been in 1982, despite an increased of four millions in the work force.

[4] For example in 1983, Mexico City had an open unemployment rate of 6.2 percent, while Guadalajara's rate was 7.4 percent and Monterey's 9.8 percent. By the end of the period rates were tending down to about 4 percent.

[5] According to these statistics, between 1980 and 1987 the urban informal sector increased from 24.1 percent to 33.3 percent of total employment. In contrast salaried employment in large private corporations fell from 29.1 percent to 21.6 percent, and in smaller enterprises from 24.9 percent to 19.8 percent.

[6] This tendency continued from 1987 to 1990; according to official statistics the minimum wage in this period dropped 27 percent.

[7] Estimates of the INEGI-SPP based on the data from the Survey of Incomes and Expenses (Encuesta de Ingresos y Gastos) show that the Gini coefficient went from 0.488 in 1977 to 0.469 in 1984. Hernández Laos (1991) comes to a similar conclusion, after he has made different adjustments to the figures to ensure comparability between surveys, with estimates from the INEGI method leading to a Gini coefficient of 0.496 and 0.477, and the with his own adjustments from 0.462 to 0.461 for the years 1977 and 1984 respectively.

[8] Tables 1 and 2 were constructed from the National Demographic Survey in 1982 (Encuesta Nacional Demográfica), and the National Fertility and Health Survey for 1987. Both are household surveys. The question about work force participation referred to the 12 month period previous to the survey.

[9] The disaggregated figures for the different sized cities are not reported here. A recent study by García and Oliveira (1990:5) has noted, however, that there are problems of comparability between the 1982 and the 1987 surveys. Despite them the authors conclude, with support from other sources that "the increase in the work force participation rate of women was at least double from 1970 to 1987."

[10] The relevant figures are:

Percentage of Housewives Contributing to Household Income by StratumStratumLow Inc Formal.

Mid Inc FormalMid-Up Formal

Low Inc InformMid Up InformNone> 50%None> 50%None> 50%None> 50%None> 50%June 198588.25.986.09.384.16.971.716.966.018.0Feb 198863.49.867.712.983.36.755.316.979.317.2

[11] According to S. de la Peña (1990), it is possible that this situation is owing to the fact that expenditures for some goods and services are inelastic, because they do not depend on personal decisions. For example transport costs, housing and energy costs whose prices rose quickly during the period. The one area where reductions can be made is food, so long as these reductions do not place the family in jeopardy of malnutrition. This elasticity occurs by substituting cheaper foods for more expensive ones.

[12] For income measures June 1985 = 100.

[13] Real income in 1985 pesos