Trump tariffs have resulted in the loss of thousands of jobs in a Mexican border town

Fabiola Galicia rose through the ranks of a beautiful ribbon business in Ciudad Juarez, which is located just across the border from El Paso, Texas, for 11 years. She began her career as a production line worker and eventually rose to the position of manager, supervising 30 workers.

However, her shift was reduced to three days per week in June. Then, in August, Galicia and around 300 other workers lost their jobs when a representative for Design Group Americas, which declared bankruptcy last month, closed its Ciudad Juarez factory.

In court documents, the business attributed some of its issues on tariffs that U.S. President Donald Trump had put in place. According to Galicia, a corporate official also pointed the finger at Trump. Galicia, whose husband was also laid off from the company, stated, “They told us the tariffs had affected the company.”

A request for comment regarding the layoffs was not answered by Design Group Americas.

Ciudad Juarez’s assembly facilities, which sell their final goods to the United States after importing raw materials primarily duty-free from throughout the globe, are in crisis. An sector already dealing with a long list of issues, such as growing wages and investor apprehension over reforms by Mexico’s ruling leftist Morena party, has been made even more miserable by Trump’s global trade war.

The plants, called maquiladoras, provide about 60% of Ciudad Juarez’s employment. One of Mexico’s most significant manufacturing centers for many years, the city’s industrial sector has prospered recently as several multinational corporations have relocated their operations to Mexico in order to avoid U.S. tariffs on Chinese-made goods, a practice known as “nearshoring.”

However, many plants are now laying off employees and in some cases closing completely after seeing rapid expansion and job creation.

According to Mexico’s National Institute of Statistics and Geography, the municipality of Juarez lost almost 64,000 factory employment between June 2023 and June 2025, including about 14,000 in the first half of the year.

“CHERRY ON TOP”

The widespread layoffs highlight the difficulties facing Mexico’s economy, which is reliant on free commerce with the United States.

Trump’s intermittent tariffs have caused businesses to struggle to stay afloat, causing projected GDP growth for 2025 to halt at less than 1%.

The maquila industry is in “crisis,” according to Maria Teresa Delgado, vice president of the INDEX Juarez maquila group. She and six other business experts blamed a number of issues, including tariffs, for the layoffs in Juarez.

They added that after a legally mandated hike in the minimum wage, factories saw a drop in their profit margins. Since 2019, the minimum wage in northern Mexico has increased from 22 pesos ($1.17) per hour to 52.48 pesos ($2.80).

Foreign investors were alarmed by the proposal made by Mexico’s former president in 2023 to replace appointed judges with elected ones, which threatened judicial independence and discouraged investment. This year, the reform was put into effect.

However, Delgado claimed that Trump’s trade war was the decisive factor. Although most Mexican exports are duty-free when they reach the United States, the automobile sector and goods like steel, aluminum, and certain textiles are subject to significant tariffs.

Regarding the layoffs, Delgado remarked, “Trump’s tariffs were the cherry on top.”

The first quarter of 2025 saw a 21% decline in foreign direct investment in Mexico as compared to the same period the previous year. Ciudad Juarez is located in the state of Chihuahua, where manufacturing foreign direct investment fell 56% from $800 million to $348 million.

“The business environment is being impacted by uncertainty,” stated Ulises Alejandro Fernandez, the Secretary of Innovation and Economic Development for Chihuahua. “Until it is clear what will happen with trade policy, companies are delaying decisions and new investments.”

As they relocate to nations with cheaper labor costs or choose to invest in the United States to avoid tariffs, some businesses are already leaving Ciudad Juarez.

Lear Corp, a manufacturer of auto parts, said earlier this year that it will move some of its production lines from Ciudad Juarez to Honduras as part of a larger cost-cutting plan in response to changing demand and growing salaries in the northern border region of Mexico.

By the end of this year, Lacroix, a French electronics maker, intends to close its Ciudad Juarez facility. The company’s main justifications for leaving North America were significant losses and trade uncertainties.

According to Thor Salayandia, president of the regional business organization Border Block Trade, he has been forced to lay off workers at his nail-making hardware firm in Ciudad Juarez. According to him, he now employs 20 people, compared to about 90 in 2023.

“Clients are reducing expenses. They place an order one day and then not the next.