Report: Trade with Mexico supports 95,000 local jobs, but faces threats

A new report from the World Trade Center of San Diego underscores the importance of cross-border trade to the local economy but warns of growing threats.

The report found that nearly 97% of the $34.5 billion in annual foreign exports from San Diego and Imperial counties is destined for Mexico, supporting 95,000 local jobs, according to the latest data.

This is due to the success of the North American Free Trade Agreement, and later United States-Mexico-Canada Agreement (USMCA), which have created a binational economy serving 7.1 million people, according to the report’s authors.

But, they warned, “despite significant strategic and economic advantages, the Cali Baja cross-border ecosystem faces headwinds from U.S. policy shifts, global trade uncertainty, and infrastructure gaps that threaten its continued growth.”

The World Trade Center, which is an affiliate of  San Diego Regional EDC , primarily used data from the World Bank from 2022 in preparing the report. The study was underwritten by Mexican software company ITJ, sponsored by the San Diego County, and drew on research support from SANDAG, the Tijuana EDC, UC San Diego, and other partners.

Among the key findings:

• Growing trade between the United States and Mexico reduces reliance on China. Mexico has emerged as a dependable, highly technical manufacturing partner, and is now responsibe for more trade with the U.S than China.
• Services constitute the fastest-growing sector in U.S.-Mexico trade. There is growing demand both for traditional sectors like IT support, call centers and financial services, as well as for high-value activities such as engineering, R&D and software development.
• Binational trade fuels jobs and economic growth in San Diego and Imperial counties, especially in critical industries like aerospace, medical devices, and semiconductors.
• Baja California is diversifying and moving up the value chain. Beyond traditional maquiladoras and electronics, the region now exports higher-value goods across multiple industries. Tijuana alone is home to more than 150 software firms.
• The Cali Baja region serves as a vital link in North America’s automotive supply chain. Major automakers like Ford, GM, Hyundai, and Toyota leverage this proximity and the benefits of the USMCA to optimize production — as exemplified by Toyota’s Tacoma plant in Tijuana.

The report didn’t specifically mention the Trump administration’s tariffs and economic threats against Mexico and Canada, but warned that the USMCA must be preserved.

“Supporting and strengthening the USMCA framework is urgent to ensure that North America remains globally competitive, resilient, and secure — protecting jobs, innovation, and prosperity on both sides of the border,” the authors wrote.

“The USMCA is not simply a trade agreement — it is the backbone of North America’s competitiveness in a turbulent global economy.”