Asia, Mexico Learn to Work Together : Industry: Japanese and Korean firms are accounting for more of Tijuana’s jobs. But relations haven’t always been smooth.

Andres Trujillo, a 27-year-old electronics engineer, is glad for the growing number of Asian manufacturers in Tijuana. He has a good-paying job with Hitachi, the Japanese electronics company, which recently sent him to Japan for a month to learn television design trends and Japanese culture.

But workers aren’t so thrilled with Hyundai, a Korean manufacturer of steel shipboard containers and truck trailers, a low-tech operation here that employs teams of welders and riveters.

On March 1, more than 300 Hyundai workers walked off the job--a rarity at the foreign-owned factories in this Mexican border town--in a wildcat strike that was the culmination of two years of unrest over wages, safety issues and what was seen as managers’ abrasive style.

The experiences at the two companies illustrate the ongoing, often rocky, adjustment of Asian employers to Latin work forces and vice versa. It is a marriage of critical importance in this city whose Asian corporate citizens--including Sony, Sanyo, Matsushita, Hyundai, Samsung and dozens of their suppliers--account for an increasing share of the jobs at maquiladoras, the foreign-owned plants set up to take advantage of Mexico’s low-cost labor.

For engineer Trujillo and technicians like him, a job at an Asian plant is a ticket to the good life, with education and travel benefits--and wages starting at 10 times what production-line workers earn.

*

But at Hyundai, according to the Baja California government officials who investigated, employees endured long shifts without rest breaks and did hazardous welding and noisy riveting work with inadequate eye and ear protection. The workers also complained about abrupt, authoritarian bosses. At one point two years ago, company vice president In Chong Song conceded, there was a 20% monthly turnover rate at Hyundai, meaning the work force was essentially new every five months.

The two-day Hyundai strike, which ended after mediation by the Baja California state conciliation and arbitration board, was an unusual event in the 30-year annals of maquiladoras. Work forces at the border plants have tended to be relatively docile, grateful to have jobs. Those with grievances tend to just quit.

Still, despite the need for adjustment on the parts of both Asians and Mexicans, the relationship between the two is working well enough to keep the Asian manufacturers coming.

They now employ 20% of the 80,000 maquiladora workers here. Companies such as Sanyo and Hitachi that have been in Tijuana for years are rapidly expanding, and parts suppliers such as Daiho and Munakata--which up to now have stuck close to Japan with satellite operations in the Far East--are coming in droves.

All are spurred by the stronger yen and by provisions in the North American Free Trade Agreement that essentially require products to be made in North America if they are to qualify for duty-free status in the U.S.-Mexico-Canada trade zone that NAFTA created.

The Asian employers have had to accommodate work habits that are vastly different from those of Japan and elsewhere in Asia. On average, they face employee turnover of about 100% per year and an acute shortage of technical personnel, among other problems.

Young Kwon, president of Samsung’s Electro Mechanics America subsidiary in Tijuana, has operated Samsung plants around the world, and he says he has never seen turnover approaching Tijuana’s rate. “We are very careful about hiring because we can’t trust people to stay. People are not stable,” Kwon said.

But the Japanese and Korean manufacturers admit that some of the turnover has been of their own doing.

“Originally, when the Japanese first came into Mexico . . . their preference was that the Mexican worker be like the Japanese worker,” said Patrick Osio of Cohen, Osio & Associates, a San Diego-based consulting group that works with U.S., Japanese and Mexican companies.

The Japanese, who began arriving here in big numbers in the late 1980s, soon realized they would have to adapt to the culture, not the other way around. They began hiring Mexican administrative personnel, which proved a key to many companies’ success in Tijuana.

“They’ve found that overseeing is the name of the game, allowing Mexicans to do the management under their supervision,” Osio said.

Among workers now, Japanese companies are generally viewed positively because they offer good benefits and safe working conditions, said Tony Ramirez, vice president of Made in Mexico, a San Diego consulting firm.

But Korean companies such as Hyundai and Samsung do not get high marks, and they have been trying to smooth over what many of their employees believe is a harsh managerial style.

“The Koreans are making the same mistakes the Japanese did when they first entered. They’ll change. It’s an evolution,” Osio said.

Hyundai officials now admit they made mistakes and say they are correcting them through better wages, safety measures, regular employee meetings--plus Spanish classes for managers, few of whom spoke the native language. The Baja California state officials who investigated the March strike say Hyundai has learned a lesson.

Hyundai also acknowledges that it compounded the problems by, for example, failing to tell employees of the pressure the company was under to fill orders quickly for its custom-built containers and trailers.

“We didn’t understand the problems of the workers, and they didn’t understand ours,” said Hyundai’s In Chong Song. “I regret it. Better communication between workers and managers is the most important thing. If there is no language, there is no word, and as the Bible says, the word comes before everything.”

The communication effort seems to be working: Hyundai said it has lowered its monthly employee turnover to 5% from the 20% of two years ago.

What other lessons have been learned?

Employers such as Sanyo and Matsushita stopped insisting that employees show up early for morning exercises, a traditional Japanese pre-work warm-up activity that did not go over well with the Mexican rank and file. (Many Japanese companies encountered similar resistance to regimentation--uniforms and exercises, for example--from U.S. employees when they began locating in the United States.)

Samsung stopped demanding overtime work with little or no notice, realizing that workers put their families above all else. Koreans and Japanese are slowly coming around to the realization that few cultures, Mexico’s or any others, can match their dedication to work.

“Their culture is completely different from ours in all the respects--food, behavior, social organization and unity,” Hitachi engineer Trujillo said of the Japanese. “To see how they work and how they have risen is really something.”

Sony used to bemoan the fact that many employees did not return to work after the Christmas holidays. Then the company found that many of the absentees were workers who went to the interior of Mexico for the holidays and stayed. So Sony hired buses to bring them back.

*

For their part, the Mexican workers have had to adjust to more rigid, work-centered employers who frown on Latin workers’ tendency to mix their personal lives with their jobs, said Jose Ibarra, general administration manager at Hitachi, where he has worked for 17 years.

“Workers want to take off to pay the rent or take care of civil obligations, and the Japanese don’t allow that,” Ibarra said.

Some of Hitachi’s workers grumbled about working Thursday and Friday of Holy Week last month--but nonetheless showed up for work on a day that most Mexicans had off as holidays.

Yet nothing seems to eradicate chronically high worker turnover. For example, Sony’s Video Tec de Mexico manufacturing operation offers employees benefits ranging from free transportation and matched savings to on-site medical care and education incentives--and still has an 8% monthly employee turnover rate, which is about average for maquiladoras.

“The root causes are that most people are new to Tijuana and are in a constant state of moving to the North or resettling in Tijuana,” said Luis Zuniga, head of Sony’s Video Tec facility in Tijuana. “People will change jobs to be closer to home, to work where friends work, to be able to share transportation, all kinds of reasons.”

Maquiladora managers said there is far less turnover among their higher-paid personnel, such as engineers and technicians--good-paying jobs that are increasing as the infusion of Asian investment continues to bring better employment opportunities to Tijuana. Companies are adding design and production of more sophisticated products to their maquiladora operations.

The demand for these workers has led to intense recruitment for graduates at the four Baja California college campuses with engineering programs.

If Hitachi’s Trujillo has any regrets, it is his 60-hour workweek. Typical of the long hours that Japanese firms demand of their top employees, it is a commitment that keeps him from his wife and infant daughter. But the big-screen TV designer seems resigned to the pace--and happy to be among the 1,100 workers at the Hitachi plant situated on a dusty mesa overlooking this border city.

“There is a lot of opportunity here,” Trujillo said. “The Japanese are very systematic, and there is an objectivity about what you are doing.”

As far as Tijuana Mayor Hector Osuna is concerned, these high-paying high-tech jobs--regardless of who provides them--will make a difference for his community.

“A good friend of mine, an industrial engineer, right now has one of the best-paying jobs in Tijuana,” said the youthful mayor. “He is manager of a Sanyo plant. . . . And that is just one example. There are many people like him who are developing knowledge or skills.”