Employees don't have Actionable information
Imagine you’re a factory worker that just moved to a city like Tijuana from a rural area. You don’t know anyone so you take the first job you can find. They force you to work 70 hours a week without overtime, so you move to the next factory, but it’s just as bad. Without effective labor laws or freedom of association you have to turn to your friends and family to ask which factories to pursue and which ones to avoid, but because they often move that information is lost or inaccurate.
Factories face high turnover
With pressure from their buyers to reduce costs and increase productivity, factories feel they must cut corners with employees. This creates exceptionally high turnover rates of 7 - 8% of the workforce every month. Employers hire labor agencies to find workers, but these agencies are expensive and have a limited network of workers. As more workers leave, recruitment and retraining costs increase. In addition, as more complex manufacturing processes are moved abroad including pharmaceuticals and aerospace products, manufacturers are unable to find and retain high skilled employees.