Every two weeks, Juan Ayala pulls $400 out of his wallet and wires it to his wife and four children in Mexico.
Ayala is among the millions of Latino immigrants who sustain the economies of their native countries by sending money home on a regular basis.
Mexican and Latin American immigrants living in the United States will send $30 billion in remittances to their relatives back home in 2014, according to a new survey by the Inter- American Development Bank.
“My family depends on me,’ said Ayala, 50, a Muscoy resident who illegally crossed the border four years ago. “I don’t know what would happen to them if I didn’t work.’
Ayala earns about $400 a week as a construction worker. Half the money goes to his family. The rest pays for his rent and food.
“My kids are in school and they have a lot of expenses,’ said Ayala, who rents a two- bedroom house with a brother and friend. “Back home, I did the same job but got paid a lot less. I wouldn’t have been able to afford their education.’
About 60 percent of the 16.7 million Latin America-born adults in the United States send money regularly to their families abroad. Remittances typically go to low-income people in economically disadvantaged areas, according to the survey.
One in seven Latin Americans, or about 75 million people, are supported by remittances, which constitute 50 to 80 percent of their household income, said Donald Terry, manager of the Development Bank’s Multilateral Investment Fund.
“It can mean the difference between abject poverty and having some decency in their lives,’ Terry said.
The money transfers vastly surpass all foreign aid provided to their homelands by developed nations, according to the survey of 3,802 Latin American immigrants in 37 states and the District of Columbia between January and April.
California sent the most money, $9.6 billion. The average remittance in the Golden State was $235 each month. Most immigrants send money at least once a month and use transfer companies, the survey shows.
Mexico topped the list of receiving countries at $13.3 billion, according to the survey. Remittances are the country’s largest source of foreign income, ahead of oil, tourism and foreign investment, Mexican President Vicente Fox said last year.
“The money sent by Mexicans in the United States creates consumption in Mexico,’ said Carlos Giralt-Cabrales, Mexican consul in San Bernardino. ” These people who receive these dollars buy products made in the United States. It helps both economies.’
Critics say remittances are a disincentive for foreign governments to make meaningful reforms that would deter illegal immigration.
“It becomes a crutch,’ said Ira Mehlman, spokesman for the Federation for American Immigration Reform, which favors limits on immigration. “Rather than make the kind of economic and social reforms that are necessary to make those countries self-sufficient, they rely on sending workers to the United States and getting billions in remittances.’
Terry said that argument is flawed.
Despite the money that leaves the United States, Latin American immigrants still contribute about $450 billion a year in earnings to the U.S. economy, the survey shows. The $30 billion sent home is a fraction of the U.S. gross domestic product of $11.5 trillion, Terry said.
“Workers are not only sending money back, but they are spending it here,’ said Jose Calderon, a professor of sociology and Chicano studies at Pitzer College. “The workers pay rent. They have to buy food. They are paying taxes. They are contributing much more than they are taking out.’
Some residents don’t see much benefit in remittances if immigrants keep coming illegally.