1Mexico has not traditionally been seen as a country of immigration, even though it has hosted well-rooted immigrant communities since the late 19th century (Palma Mora, 2006) and it has been both a haven for exiles (Yankelevich, 2002) and a transit country for Central Americans on their way north (Carrasco González, 2013; Barros Nock and Escobar Latapí, 2017). US citizens are the main foreign nationality in the country; a large portion of them are retired people living in Mexico’s northern region (e.g. Lardiés-Bosque et al., 2016), tourist coastal areas (Hiernaux, 2010) and well-known “enclaves” such as San Miguel de Allende (Guanajuato). In this regard, it is worth mentioning that a substantial part of the US-born residents in Mexico are of Mexican descent (Gaspar Olvera, 2019).
2Since the mid-1980s Mexico has increasingly promoted economic internationalisation and launched a neo-liberal economic agenda (Otero, 2018) that has altered the opportunity structure for businesses and fostered new demands for skilled workers (see, for instance, Mendoza, 2018). Economic internationalisation implies not only that the production of goods and services is more homogenised worldwide but also that education follows similar patterns globally (Ackers, 2005). Accordingly, highly educated immigrants with transferable skills are frequently considered part of a global elite of migrants who flock to places where innovation is highly prized and their specific talents can be best put to use (Storper, 1997; Ong, 1999). It seems likely that this group will become more important in the near future, given the current skill shortages in many OECD countries (OECD, 2016). Some authors have also argued that current flows of skilled migration are dominated by a demand for employees, whereas thirty years ago these flows were governed by a surplus of workers (Khadria, 2009). As an emerging market in the global economy, Mexico may indeed require foreign professionals for some industrial activities and services, as well as creating new openings for businesses.
3Certainly, globalised Latin American cities have increasingly become important destinations for migrants (Feldmann et al., 2018), and Mexico in particular has recently been attracting a significant number of immigrants, especially from Spain. Thus, in 2015 Spaniards constituted the third largest foreign population in Mexico, after citizens from the USA and Guatemala (INEGI, 2020), and in the past decade the number of Spanish residents has skyrocketed as a result of the severe economic crisis in Southern European countries (Rodríguez-Fariñas et al., 2016). According to official Consulate data, the number of Spanish residents in Mexico rose from 69,571 in January 2009 to 135,955 in January 2018 (INE, 2018). In fact, the annual increase in Spanish immigrants in Mexico in 2009-2018 (7.4%) is higher than that of Spanish immigrants worldwide (5.8%). Other Southern European nationalities are not as numerous in Mexico — Italians, for example, mainly emigrate to Central and Northern Europe (Bichi, 2017) and only ranked thirteen in the foreign populations in Mexico in 2015 (INEGI, 2020). Nevertheless, the impact of emigration on Italian labour markets should not be underestimated: in 2006 expatriates numbered 5.2% of the total labour force, increasing to 7.1% for graduates (Dumont et al., 2010), while more recent statistics also show that Italian emigrants include a large proportion of young graduates (in 2017 31% of emigrants had university diplomas; Istituto Nazionale di Statistica, 2018).
4Despite these growing trends, immigration into Mexico has not been extensively studied in the literature, apart from research on specific immigrant groups (Palma Mora, 2006) that has recently tended to focus on skilled workers. More specifically, books by Castaños Rodríguez (2011) and Izquierdo (2015) have examined immigrants working as academics in Mexican universities and research centres and have concluded that Mexican academia is relatively open to new arrivals from abroad. As regards workers outside academia, Mendoza and Ortiz (2006) noticed the increasing incorporation of Spanish immigrants into Transnational Corporations (TNCs) following the entry of Spanish capital into Mexico in the 1990s, and more recently Mendoza (2018) has observed an increasing inflow of young skilled Spaniards into Mexican labour markets. Similarly, Asian communities have recently expanded throughout Mexico, and this trend has been seen as an indicator that Mexico has emerged as an attractive market for Asian investors and traders (Alba and Rubio, 2018). Nevertheless, studies on immigrant entrepreneurship in Mexico are very scarce and the few that have appeared are of a historical nature (e.g., Lida, 1994, on Spanish entrepreneurship in Mexico; Cerutti, 1999, on the role of Spaniards in the formation of a new entrepreneur class in northern Mexico; Meyer and Salazar, 2003 on a historical review of immigrants in business in Mexico; Checa-Artasu and Niglio, 2019, on the professional success of specific Italian engineers, architects and artists who developed their career in the 19th and 20th centuries in Mexico). This paucity of research is all the more surprising when we consider that many of Mexico’s major companies are now headed by descendants of Spanish immigrants (e.g., the Modelo brewery and the Gigante food manufacturer, see Noceda, 2005).
5To fill this gap in the literature, this article studies the incorporation of a group of small entrepreneurs and self-employed workers from Italy and Spain into the Mexican labour market. The data come from more general research into skilled immigration (i.e., immigrants with a university diploma, see also Eich-Krohm, 2013) that comprised 129 in-depth interviews with tertiary-educated Italians and Spaniards in four Mexican cities (Mexico City, Monterrey, Guadalajara and Puebla).  This paper specifically focuses on the thirty-four interviewees who were self-employed and entrepreneurs at the time of their interview (around a quarter of the total number, at 26.4%). By focusing on highly educated businesspeople and self-employed workers, the paper challenges the assumptions of the enormous body of literature on ethnic entrepreneurship, which mainly revolves around disadvantaged immigrant communities. It thus seeks to challenge the prevailing perceptions of immigrant entrepreneurs, which are largely based on the experiences of low-skilled immigrants (Kloosterman, 2010).
6The next section of the article critically reviews the literature on ethnic businesses, immigrant entrepreneurship and self-employment, and concludes that, even if overall this research has limited bearing on our analysis of immigrant groups, certain concepts (e.g., opportunity structure) and analytical avenues explored therein may be of great help. The article then goes on to explain the methodology that was applied, with detailed descriptions of the fieldwork, the characteristics of the interviewees and the procedures used to analyse the qualitative data, with a particular focus on the results of the research. Along these lines, the article first examines the interviewees’ working lives in Mexico, showing that twenty-eight out of the total of thirty-four entered business/self-employment in Mexico with no prior experience in the field in Italy/Spain. This highlights Mexico’s role as a country that provides business opportunities. The article develops this premise by then focusing on market conditions, access to ownership and institutional frameworks in Mexico, which are relevant theoretical dimensions in the literature exploring opportunity structures for immigrants (e.g. Aldrich and Waldinger, 1990; Kloosterman, 2010). The paper goes on to study the relevance of social capital to any understanding of entrepreneurship by Southern European immigrants in Mexico. We argue that the success of businesses and self-employment in these tertiary-educated immigrants relies on their capacity to create social networks in not only their own communities but also the host society in general. The paper concludes with some final remarks.
Theories on Immigrant Entrepreneurship
7Immigrant entrepreneurship has gripped the attention of migration scholars since the 1970s. Bonacich (1973), with her theory on middleman minorities, presented ethnic businesses as economic and cultural responses to fragmented and hostile host labour markets, in which the adverse conditions for immigrants’ incorporation could push non-natives into self-employment and trade. Bonacich’s ideas subsequently appeared in ecological approaches that also maintain that immigrants face limited work opportunities at their destination and are consequently driven towards entrepreneurship as a means of escaping unwelcoming labour markets (e.g. Saxenian, 1999; Bauder, 2008). Ethnic businesses would thus be the result of discrimination, language barriers and other labour market disadvantages, and consequently immigrant businesspeople would fill labour niches not occupied by natives (e.g. Light and Bonacich, 1988; Andersson and Hammarstedt, 2015). It cannot be argued, however, that Italians and Spaniards face adverse working conditions in Mexico — in fact, the literature on immigration in Mexico points in the opposite direction (see, for instance, Palma Mora, 2006; Izquierdo, 2015).
8The category of “middleman minority” was taken up by Portes and Böröcz (1989), who placed it in the broader context of incorporation of immigrants into labour markets, whereby immigrant entrepreneurship has three possible outcomes, according to the conditions of the host countries. Middleman minorities are the result of “handicapped” conditions in destination countries. In an “advantaged” context, however, immigrants develop “enclave economies” (Portes and Böröcz, 1989). These constitute a distinct type of ethnic economy, involving geographically concentrated economic activities that transcend the limits of small-scale businesses and commerce to embrace ethnic institutions that mediate economic activity, such as chambers of commerce, informal credit associations and hometown associations (Wilson and Portes, 1980). Light et al. have argued, however, that the emphasis on the geographical concentration of “enclaves” underestimates an ethnic group’s control of ownership, as well as the contribution of unpaid family labour and other workers from the same ethnic group, which eventually allow members of that group to be channelled into the mainstream economy (Light and Rosenstein, 1995; Light and Gold, 2000).
9The bottom line of both “enclave economy” and “ethnic economy” studies is that certain groups of immigrants are more entrepreneurial than others, and consequently more likely to adopt small business ownership and self-employment as effective strategies in their incorporation into the labour markets of host countries. This perspective has been labelled as “culturalist” (i.e., certain groups are culturally inclined towards business), in contrast with previous ecological approaches (Rath, 2007). In short, this literature stresses the distinct group-specific cultural repertoire of businesspeople and self-employed workers in the form of cultural values, behavioural patterns, social structures, collective resources and coping strategies (Zhou, 2004).
10The literature mentioned above emphasizes the role of intra-ethnic networks in entrepreneurship. Access to these social capital resources is associated with ethnic solidarity, based on expectations of mutual support between members of the same migrant community, which is united by cultural similarities and difficulties in accessing formal support systems (Faist, 2000). Many studies have shown that self-employed immigrants make extensive use of this type of bonding social capital, mostly through access to financial capital, cheap and trustworthy labour and business-related information (e.g., Sanders and Nee, 1996). However, only a few studies have empirically examined the effect of bridging social capital (i.e., social networks between an ethnic group and the host society; Putnam, 2000), let alone theorise the relevance of this type of capital to immigrant entrepreneurship (Kanas et al., 2009).
11On the basis of this literature, this article explores the relevance of both bonding and bridging social capital to any understanding of entrepreneurship in Southern European immigrants in Mexico. We argue that the success of businesses and self-employment in these tertiary-educated immigrants relies on their capacity to create social networks within their own communities, and in the host society in general. It could be argued that contacts with natives of the host country improve business prospects and that, as members of small “welcomed” communities, Italians and Spaniards might have a privileged position as regards access to information, suppliers and customers in Mexican labour markets (see also Palma Mora, 2003).
12On the basis of these ecological and culturalist approaches, Aldrich and Waldinger (1990) and Waldinger et al. (1990) developed a composite theory that brought together these views, based on the principle that entrepreneurship is the product of the interaction between group characteristics and opportunity structure. It has been argued, however, that this theory conceptualised the opportunity structure based on the assumption of an unregulated and undifferentiated economy (Rath and Kloosterman, 2000). Acknowledging the salience of institutional regulation, researchers have proposed a mixed embeddedness approach to immigrant entrepreneurship (Kloosterman et al., 1999; Kloosterman and Rath, 2001). The mixed embeddedness approach combines the micro-level of the specific characteristics of individual entrepreneurs with the meso-level of local opportunity structure, and ultimately the macro-institutional framework (Rath and Kloosterman, 2000; Kloosterman, 2010). It is argued herein that Italian and Spanish immigrants take advantage of local opportunity structures, and we analyse market conditions and competition for vacancies, access to ownership and the institutional framework. We do not pretend to give an “objective” appraisal of the opportunity structure for immigrant entrepreneurship but instead analyse them from the “subjective” viewpoints of our interviewees.
13Finally, the extensive literature on immigrant entrepreneurship has often underestimated the role of human capital for business (Ley, 2006; Ambrosini, 2012). This is probably because education and work experience prior to migration might be considered of low quality and difficult to transfer to destination countries (Chiswick and Miller, 2009; Campbell, 2016). Along these lines, Sanders and Nee (1996) found, in their research on seven immigrant groups in the USA, that their human capital prior to arrival had little value in the mainstream labour market, even though the possession of skills, work experience and other useful assets facilitates self-employment (see also Li, 2001 for Canada; Constant and Zimmermann, 2006 for Germany). Furthermore, several studies show that educational level and training courses help entrepreneurs to manage their businesses and achieve economic success (e.g. Kim, 2006; Valdez, 2008). Other authors, in contrast, argue that education and work experience might decrease the likelihood of being self-employed, suggesting that self-employment is a survival strategy born out of necessity (Aliaga-Isla and Rialp, 2013; Brzozowski et al., 2017).
14In our research, all the interviewed self-employed workers and entrepreneurs had a university education, since they were part of a larger sample of skilled migrants. It would therefore seem that the assumption found in the literature that migrants’ education would not be valued in the host labour market is not applicable here. Furthermore, by researching a highly educated group, the article challenges the general perception of immigrant businesses being mainly managed by low-skilled foreign-born employers and self-employed workers. As for prior experience in self-employment and business before immigration, only a few of the interviewees had been involved in this type of activity before moving to Mexico, so the article explores the reasons of some employees of large companies and international agencies for entering into entrepreneurship. The next section details the characteristics of the fieldwork carried out in four Mexican cities, as well as examining the research group more closely.
15This article is based on thirty-four semi-structured interviews with Italian and Spanish employers and self-employed workers in Mexico. These form part of more general research on skilled migration in Mexico, comprising a total of 129 interviews with Spanish and Italian skilled immigrants in four Mexican cities. Skilled migration is far from being homogeneous (Nagel, 2005), and the first issue our research faced was the definition of a skilled immigrant. For instance, Meier (2015) argues that the term itself is incorrect, since not all highly skilled immigrants can secure a professional position commensurate with their qualifications. Generally, however, the literature agrees that immigrants are qualified when they possess a higher education diploma (and this is the criterion used in the research), even though educational degrees are not always easily transferable between countries (López-Rodríguez et al., 2007; Eich-Krohm, 2013). It is also generally assumed that people with higher education are abler to perform functions at a higher level in different labour markets than other workers (Fratesi, 2014).
16Of the 129 interview carried out with skilled immigrants, a total of forty-one were carried out in Mexico City, thirty-one in Guadalajara, thirty-one in Monterrey and twenty-six in Puebla. Following the definition generally used in the literature, all the interviewees hold at least a graduate diploma, with a relevant percentage of them (23,4%) having postgraduate studies. Although the research did not attempt to achieve a representative sample, efforts were made to collect information from immigrants with differing backgrounds. Thus, we interviewed men and women in similar numbers, as well as different types of skilled migrants (e.g., employers and self-employed workers, managers and technicians in multinational corporations, academics; Table 1). It was not possible though to attain an equal number of Spaniards and Italians, because the former outnumbered the latter by four to one in Mexico in 2015 (INEGI, 2020). Italians were selected because both Italy and Spain shares similarities concerning labour markets and emigrants’ profiles. Thus, the comparison of labour trajectories of similar immigrant groups may help determine if there is any relevant national-based characteristic, when understanding employment outcomes.
17Mexican census and surveys data do not allow to calculate exactly the volume of skilled immigration in Mexico. Yet rough approximations could be made from Mexican official data. Thus, using the 2015 Intercensal Survey (INEGI, 2020), it is concluded that 64% of Spanish-born people has at least university studies in 2015 (although neither the year of arrival of these immigrants nor their professional profile cannot be determined). Partly due to the lack of reliable official statistics on immigrants in Mexico, a snowball sampling technique was used. Participants were assured that the information provided would be treated confidentially, so pseudonyms are used herein. Most interviews were carried out in the interviewees’ workplaces, although some were held in their homes or in cafeterias, at their request. The fieldwork was carried out from June 2014 to September 2015. The 129 in-depth interviews lasted an hour on average and were structured along three lines: work, social integration and geographical issues. The interviews propitiated discussion on reasons for migrating, intentions to stay, Mexico’s labour market (e.g., views on workmates, professionalism and discrimination at work), everyday experiences in Mexico (e.g. living standards, everyday spaces) and links with the home country. Data were analysed through a content analysis method (using MAXQDA software) that included open coding, category creation and abstracting.
18Our research shows a great diversity of experience in the skilled immigrants, as reflected by their differences in gender, age and socio-economic circumstances. We therefore found the interviewees’ profiles to be heterogeneous, with the exception of their credentials in higher education. All the interviewees had completed undergraduate studies, at the very least, and they were all entrepreneurs, self-employed workers or employees in managerial, technical or academic fields. The duration of their residence in Mexico varied greatly. For some, their stay was clearly temporary, but this was not the case for the majority as their future options were more open. Although the interviewees were asked about a wide range of topics, from social integration to everyday life in the four surveyed cities, this article revolves around incorporation into the Mexican labour market, in terms of both initial employment and labour mobility.
19This article specifically focuses on immigrants who were employers and self-employed workers at the time of their interview. This group constituted almost a quarter of the non-representative sample (thirty-four out of 129; 26.4%; Table 1). The typical profile of these interviewees involved in entrepreneurship and self-employment was that of a middle-aged man with an average residence in Mexico of seven years and no business experience prior to their immigration. Only eight out of the thirty-four had had previous experience as employers and/or self-employed workers before their arrival in Mexico, so for the other twenty-six the entry into self-employment/business activities had occurred during their time in Mexico. The thirty-four interviewees are distributed almost equally by the four study cities (ten in Mexico City, eight in Guadalajara, ten in Monterrey and six in Puebla). 
Table 1: Interviewed Italians and Spanish highly-skilled immigrants, by sex, age, year of arrival and professional profile
Table 1: Interviewed Italians and Spanish highly-skilled immigrants, by sex, age, year of arrival and professional profile
Entering Business: From Students/Employees to Entrepreneurs/Self-employed Workers
20The bulk of the interviewees entered business/self-employment once they were in Mexico. The number of people in these activities in our non-representative sample rose dramatically from eight on arrival in Mexico to thirty-four at the time of their interview. Our data suggest that, as immigrants stay longer in Mexico, they adjust to the social, economic and political circumstances and are consequently more likely to be involved in entrepreneurship (see also Portes et al., 2002; Zhou, 2004, for immigrants in the U.S; and Li, 2001 for Canada). Therefore, self-employment and business do not seem to be a survival strategy developed by immigrants at the early stages of their incorporation into a host country’s labour market to overcome blocked access to the main economy.
21We identified three paths into entrepreneurship in our fieldwork. The first involved a small group of four students (three Italians and one Spaniard) who arrived in Mexico via university graduate exchanges and then decided to start their own business after finishing their studies. This group may be small but it is worth mentioning that the path to employment via university in Mexico was more common in our broad fieldwork with 129 interviewees, but the majority opted for jobs as employees (and consequently fall beyond the scope of this article). As an example of the transition from university to entrepreneurship, Enzo, who came to Mexico in 2010 as part of a university exchange, entered his current job through a capital expansion in an Italian-owned company. He is now self-employed as a product manager who shares some of the profits as a partner. In his own words:
“- So, you contacted [name of the enterprise] when you were a student?
- In fact, I knew them. D. [friend of the interviewee, also Italian] came one year before me, also through the same university exchange. I knew the other partner too. And they said, ‘Why don’t you join the company? We’re growing’. So, I said, ‘OK, why not?’ I’m in charge of the security system line in the company. The chance of creating a business here is far easier than in Italy. We started with a small investment and things are going well.” (Enzo, twenty-eight, Modena, Italy, five years in Mexico City).
23A second group is composed of expatriates, who arrived in Mexico through transnational corporation arrangements and decided to remain in the country beyond their short-term contracts. They resigned their jobs in the TNCs and chose to start a business in Mexico — a step that they considered to be far more complex in Italy and Spain. The following two extracts show this evolution and explain reasons for entering business. The first speaker is Josep Lluís, a forty-two year-old businessman from Barcelona, married with one son, who was sent to Mexico City as the director of a Spanish subsidiary company but owned his own business at the time of the interview. The second is Jaime, an engineer from La Coruña who had been an expatriate in Puebla. After a time, Jaime created his own company with friends, using the contacts made in Mexico, but he kept his job in the TNC for a while. By the time of his interview, he had left the transnational and was fully dedicated to his own business:
“- The opportunity of buying the company just came up. The transition towards entrepreneurship was indeed smooth. I am a member of the Catalan business circle in Mexico. Someone wanted to retire and return to Barcelona, and he put the business on sale. He approached me personally, showed me the figures, and asked me a reasonable price. I saw a great potential, I mortgaged everything and I bought the business from him.” (Josep Lluís, forty-two, Barcelona, Spain, seven years in Mexico City)
“- How did you decide to start your own business?
- Basically, I took advantage of the contacts I had within my ex-company. [Name of the company] is a world of opportunities. After several years in the company, you notice how things work, that many services are outsourcing, you get to know how the contracts work. Even my boss told me ‘Why don’t you make up your mind and start up something?’ […] So, I started my own company with some friends and, for a while, I did my job at the main company and I had my own factory. The business worked well, and right now I am an employer full time.” (Jaime, thirty-three, La Coruña, Spain, six years in Puebla)
26The underlying idea is that not all expatriates prefer to return to Italy/Spain as soon as their contracts end but that some remain longer and even opt to change their professional activity. This evidence diverges from the literature on expatriates in emerging countries, which highlights the temporary nature of such displacements (see, for instance, Iredale, 2001; Harvey and Beaverstock, 2016). The lack of job prospects and the difficulty of doing business in Italy/Spain, as well as Mexico’s overall economic stability at the time of the interviews, made the host country appealing.
27Our fieldwork also identified a third group of non-expatriate employees who also decided to start up their business, after a period living in the country. They are mainly immigrants who had previously worked in government agencies and private companies. As in the cases above, their knowledge of Mexican labour markets was vital to their step into entrepreneurship. Contacts made in their previous jobs made it easier to decide to set up their own business. The following extracts come from two people who were employed in Mexico City’s public administration and decided to quit their jobs. They were motivated not by higher wages but by other factors, such as flexible working conditions and jobs more suited to their training and interests:
“I first arrived through a Spanish co-operation project for four months, and I knew a lot of people working in the field of human rights. They contacted me, and I came to live permanently in Mexico in January 2001 […]. I worked for a government human rights body for nine years, and then for two more years in the Public Prosecutor’s office, specialising in gender violence. In 2012 I quit and I am now working as a freelance consultant. My expertise is human and gender rights. […] After fourteen years, I am well-known and I have no problems getting work. In fact, I travel a lot and, sincerely, I don’t miss the round-the-clock government times.” (Roberto, fifty-five, Valencia, Spain, sixteen years in Mexico City)
“I came to Mexico through a Spanish fellowship to work in an international organisation. After three years, they decided to hire me for four more years. Little by little, I started to focus on sexually transmitted diseases, and I met relevant people in the public administration in Mexico City to the point that, after a meeting, they offered me a manager’s job in a city’s public hospital. I thought that this would be more fascinating than it really was, and, after three years and many hours of endless meetings, I decided to quit. But through the contacts I made in the hospital I now have my own consultancy.” (Catalina, thirty-seven, Madrid, Spain, thirteen years in Mexico City)
30There are two general messages shared by all three of the identified employment paths. The first is that highly educated immigrants leave well-paid salaried jobs to pursue entrepreneurship. In doing so, they can better utilize their skills and social networks to achieve material gains, maximise their human capital returns and eventually raise their middle-class status. This concurs with the results of Zhou (2004) on immigrants in the US, and those of Bagwell (2015) on Vietnamese businesses in London. The second message is that Mexico is considered to be an emerging economy with ample employment possibilities. The dominant opinion is that Mexico’s economy has good prospects and offers excellent employment opportunities that allow immigrants to move upward in labour markets as well as climbing the social ladder. The following section goes deeper into this specific point.
Opportunity Structures for Business
31In the previous section, the idea of business opportunity was clearly expressed by the interviewees. The literature also sees this concept as a key to understanding immigrants’ incorporation into business and self-employment. For some authors, opportunity structure can be broken down into market conditions and access to ownership (e.g. Aldrich and Waldinger, 1990; Waldinger et al., 1990). They argue that the success of businesses hinges on the size of the immigrant population, as well as on access to customers beyond the community. Apart from market and ownership, a mixed embeddedness approach also incorporates the institutional framework (i.e., labour regulations, business regulations and webs of interrelationships of firms and relevant actors — the business system; Kloosterman et al., 1999; Rath and Kloosterman, 2000; Kloosterman, 2010).
32According to our interviewees, market conditions are crucial to success in business. Mexico is attractive for various reasons, based on a huge potential market and a surprising lack of competition. Lara summarises this feeling of how easy it is to start a business, but she also reckoned that the competition is ill-prepared rather than scarce. Lara said in her interview:
“The facilities for setting up a business in Mexico are huge. The Mexican population is 110 million, in Spain it is 40. In Mexico City, you open a coffee shop somewhere, and, no matter how lucky you are, you’ll sell hundreds of coffees every day. This is one reason, and there is another. The second reason is the lack of preparation of competitors. This is a clear advantage for you.” (Lara, forty-two, Madrid, Spain, six years in Mexico City)
34Lorenzo added a further twist to the argument by saying that, in his case, the motivation was not ill-prepared competitors but rather the high prices of the offers available in Monterrey. Foreseeing a successful niche, he created his own business. He explained in his interview how he passed from website services to a more sophisticated array of IT services. In his own words:
“In Spain I had a business that was dedicated to ad marketing, how to place companies in Internet searches [...]. Once in Mexico, I focused on websites. In the United States, you could get a website for 30 dollars, and in Mexico for 4,000 pesos (230 dollars approximately). So, I hired a server in the United States, offered the same service as in the United States, and lowered the price. From then, the business expanded [...]. We went from websites to domain registration, digital clouds and similar services. Right now we are working on websites adaptable to devices. I have seven employees and one in telework.” (Lorenzo, fifty-three, Ferrol, Spain, five years in Monterrey)
36Lorenzo is one of the eight employers (out of the thirty-four interviewees) who was in business prior to migration, and he could use his expertise in his new country. This is not the case of Davide, who went from university into business; he explained in his interview that his main selling point was his company’s great flexibility and adaptability to new demands and requirements:
“We are well-known, because we are trustworthy. Our aim is to obtain clients’ trust, whether they be architects, builders or anything else. We never stop, we do not have a fixed stock of product, we change them depending on the demands of the market. Every year we send architects to Milan and other European cities, to different fairs, in order to get updated products in our field, and we tried to bring them here. Our idea is to be always on the move, searching for good qualities and prices at the international level.” (Davide, thirty, small town in Sardinia, Italy, six years in Mexico City)
38The point is that the majority of interviewees was able to carve specific niches which were not widely covered in Mexican labour markets. This may be because they offered new products and/or more competitive prices which are aimed at a large market. Our fieldwork diverges, however, from the literature on ethnic business that stresses the relevance of immigrant communities to success in business, because the key to the success of our interviewees’ companies was their appeal to the general public, through offering high quality and prices not to be found on the Mexican market.
Access to Ownership
39Following the scheme proposed by Aldrich and Waldinger (1990), access to ownership is the second characteristic of opportunity structure that is relevant to business. The interviewees saw business ownership as being financially accessible for various reasons, particularly positive exchange rates (for Europeans), a relatively inexpensive flexible real estate market and fewer taxes than in Europe. This view was summarized by Maurizio, who had had a pizzeria in Barcelona and had owned another one in Puebla for four years at the time of his interview:
“I got married here in Mexico [to a Mexican woman], and then we moved to Barcelona. Suddenly work was scarce because of the crisis. Everything is expensive there (rent, wages, taxes). Furthermore, my wife did not find a job there, so we decided to come to Mexico. With few savings, we opened the pizzeria. With that money, it would be impossible to start a business in Italy or in Spain.” (Maurizio, thirty-five, Naples, Italy, four years in Puebla)
41Similarly, Leo explained in his interview how he decided to start up a construction business in Guadalajara. He first went to Mexico in 2000 and did several jobs for the Spanish and Mexican public administrations. After seven years, he decided to expand his family’s Spanish business in Mexico, as he considered the initial investment required to be low. This case is especially interesting, because his first intention was to separate himself from the family business and start from scratch in a new country. However, he gradually made up his mind to move into entrepreneurship once he got to know the city’s business circles. The following extract explains this evolution:
“- Your parents had a construction business in Spain?
- My grandparents founded it. My achievement was to bring it here, develop it. […] I have a background of certain amount of intellectual and economic capital, and certainly contacts after spending many years in Guadalajara. Despite its 4 million people, Guadalajara is a ‘small town’ […]. With one million euros in Spain, you can do hardly anything in the construction business. Here a million euros is a very solid amount for developing a business.” (Leo, forty, Valencia, Spain, fifteen years in Guadalajara)
43The mixed embeddedness approach also incorporates the institutional framework into its analysis. Interviewees were fairly discreet on this particular subject and their views were quite generalised. Most of them pointed to the inflexibility of the labour markets (and obstacles to making business) in Italy/Spain, which made setting up a business in Mexico seem relatively affordable. In this respect, Alberto decided to create his own cosmetics shop, on top of a demanding full-time job as a manager in an international bank, because he found it relatively easy. Even if he does not directly mention legal procedures, his words (“this country gives me the opportunity to do it”) reflect a sense of ease. In his own words:
“- Two months ago I opened up a shop in the South (of Mexico City). I sell cosmetics products from the company I used to work for.
- How did the idea of the shop come up?
- I do not like to be inactive, to waste my time […]. I am in the shop at weekends, and an employee is in charge during the week. I am a full-time employee, and I really like my job at the bank […]. I am just trying it because this country gives me the opportunity to do it. Maybe I couldn’t have done this in Italy.” (Alberto, twenty-seven, Milan, Italy, six years in Mexico City)
45Not all the interviewees shared this impression, and others were more critical when they assessed the “business milieu”. Antonio said that business is easy but legal procedures are not. This apparent contradiction is explained in the following extract:
“- I have two businesses: one processing food with a friend who had a fish company and a second in portable skating rinks. We sold these ideas to local governments. These are two completely different businesses […]. I noticed that there are plenty of business choices here. For everyone, for everything, practically.
- Was it easy?
- No. Mexico is hard for setting up a business. Hard in the sense that bureaucratic procedures are long and tiring. It is easy because you can create a business with a silly idea and you start. But the procedures are hard.” (Antonio, thirty-eight, Valencia, Spain, twelve years in Monterrey)
47However complicated these procedures might be, the point is that our interviewees were successful in business. In other words, bureaucracy is seen as a burden to bear, a necessary toll to pay in a foreign country, but it is not a deterrent for self-employed activities and business. Interestingly enough, none of the 129 interviewees had moved from entrepreneurship/self-employment to an employee status. All the interviewees had in common the fact that the products and services offered by their companies were aimed at the general public (and not immigrant communities). This makes contacts established in the host society crucial to any understanding of the creation/expansion of businesses. The next section explains more fully the role of social networks in immigrants’ business and self-employment activities.
Social Capital, Oiling up Business
48The previous examples clearly indicate that entrepreneurship and self-employment are linked to upward mobility and a feeling of fulfilment in Mexico. This mobility is not exclusively related to migrants’ educational or occupational achievements but also reflects an extensive use of the social networks that they create after spending time in the country. Many studies have shown that immigrants make extensive use of intra-group networks for developing entrepreneurship and self-employment, mostly through access to financial capital, cheap and trustworthy labour and business-related information within the immigrant group (e.g. Ram et al., 2000). However, only a few studies have empirically examined the effect of the social networks built between the immigrant group and host society, let alone theorise their relevance to immigrant entrepreneurship (Kanas et al., 2009).
49The majority of the interviewees testified to the significance of the contacts that they had made in Mexico. The fact that two thirds of those in business/self-employment at the time of the interview took this path after migrating to Mexico confirms this significance. To take one example, Catalina, who had worked in a public hospital as a manager, said that “through the contacts made in the hospital I now have a consultancy of my own”. This interviewee is interesting because she is also involved in a massage/reiki business and had actually learned these skills during her time in Mexico. In her interview, she explained how she started this activity and went on to expand it:
“I do consulting for the government of Mexico City through an NGO I know from the time I was in the hospital. I also give yoga classes, massage therapies, reiki. I took a course in natural products, herbs […]. I started from scratch, giving massages to friends. Through friends, and slowly, other clients came up. It has been two hard years but right now I have permanent clients, if I can call them that.” (Catalina, thirty-seven, Madrid, Spain, twelve years in Mexico City)
51Work-related networks built up in previous jobs and personal networks were the channels through which Catalina created and expanded a range of self-employed activities more suited to her personal interests. This was also true of Alberto, whose case was discussed above: he sold cosmetic products from his ex-employer in his own shop. In other cases, networks were created in more informal settings, as in the case of Davide, an MA student who decided to create a small company with his Italian friends. In this case, their client portfolio was also consolidated through personal networks. In Davide’s words:
“We started the company in the house of W. We were three friends. Two years ago, we started a business working in architecture. We hired technicians, engineers, and then administrative staff. We are now fifteen people […]. Setting up the company was very easy: university contacts, friends, friends of friends. We know each other, we go out together, we party together. I met one of my best clients at a party. It was very easy. Moreover, the Mexican culture is very open, it was not difficult at all.” (Davide, thirty-one, small town in Sardinia, Italy, six years in Mexico City)
53“Contacts”, “networks”, “friends”, “easy” — these are all words that often crop up in the interviewees’ descriptions of the process of creating/consolidating a business. Beyond this, however, three underlying messages emerge. The first is that the interviewees had access to social milieus considered easy (and consequently normal) but which may in fact be “restricted” to limited circles. Not everyone gets to know potential clients in an informal setting like a party. Along the same lines, the second underlying idea is that the interviewees are part of a “welcomed” minority, which facilitates their entry into a network of contacts useful for business. Because of their origins, our interviewees got access to “restricted” milieus that may open up business options (see also the previous example of Josep Lluis, who got his current business through a meeting of a business circle). Following on from this idea, the third underlying message is that immigrants’ human capital in Mexico is highly valued by the labour market of the host country and, more generally, by the population as a whole. This is completely different from the reflections in the literature on immigrants’ human capital in host societies/labour markets where qualifications are not readily accepted (see, for instance, Chiswick and Miller, 2009; Campbell, 2016). This is certainly an important comparative advantage for Spaniards and Italians in Mexico.
54Social capital built up inside immigrant communities, however, did not have such great importance for our interviewees. This is partly because Spaniards and Italians are far from being well-established immigrant communities. Nevertheless, we did find that, particularly in the case of the Italian interviewees, transnational networks were important for some businesses. The following extract comes from an interview with an Italian entrepreneur who explained how his jewellery business works:
“We also work with jewellery. It works very well, we have Italian brands, and we sell to large department stores and small jewellery shops. We are the middlemen. We do the advertising, we guarantee the quality of the Italian product, we import the jewels. We are in charge of the whole process. We guarantee quality and, in doing so, we get trust and loyalty from both our suppliers and our customers.” (Paolo, thirty-four, Bari, Italy, five years in Mexico City)
56In order to offer an Italian product, Paolo maintains a well-established network of suppliers back in Italy. As he says, this network is built on trust and loyalty, and businesses are reliable for both suppliers and customers. This raises another point commonly found in the interviews: a perceived greater commitment to business on the part of our interviewed employers, compared to their Mexican competitors, who follow more informal business rules. Certainly this sense of commitment (linked to a profound sense of community) recalls previous experience of skilled immigrants in Mexico, such as the French (Gamboa Ojeda, 2003), the Jews (Carreño, 2003) and the Spaniards (Lida, 1994; Cerutti, 1999) during the 19th and 20th centuries.
57This paper has explored the complexity of entrepreneurship among highly-educated immigrants from Southern Europe in Mexico, by giving voice to a group of Italian and Spanish employers and self-employed workers living in four Mexican cities. This group shares a substantial human capital that is valued in the host destination. This is in line with previous literature on immigration into business in Mexico (see Lida 1994; Cerutti 1999; Meyer and Salazar, 2003), but it contradicts the literature on immigrant entrepreneurship. The circumstance of human capital being valued in Mexico probably explains why the interviewees see the passage from employee to employer/self-employed as free of obstacles, to the point that the number in entrepreneurship rose from eight on their arrival in Mexico to thirty-four at the time of their interview. The paper has identified three paths to business/self-employment that lead a range of highly educated immigrants to give up good salaries to pursue entrepreneurship. They feel that this move will allow them to make better use of their skills to achieve material gains and maximise the returns on their human capital.
58The paper has also unpicked the concept of “opportunity structure” in terms of market conditions, access to ownership and institutional framework and shows that the interviewees considered business to be relatively easy. The Mexican market is especially relevant in this respect, as it is seen as huge and full of opportunities. This is because of the large number of potential customers, due to not only the size of the market but also the lack of competition, in the opinion of the interviewees. These circumstances allow immigrants to carve out specific business niches that had previously been overlooked, such as brand new products (e.g., Italian jewellery), more competitive prices (e.g., cheaper web services) and more professional attention to customers. In other words, success is linked to innovation, which is itself linked to specific strategies (introducing new products, lowering prices) and the characteristics of a potentially large demand.
59Business success is not, however, merely a question of higher quality and standards, as it is also directly related to the interviewees’ capacity to establish social networks in Mexico and, in turn, build up trust among customers. All the interviewees stressed this point. It is certainly the case that Spaniards and Italians form part of “welcomed” immigrant minorities that may have a positive impact on the achievement of relevant contacts, both within the group community and beyond, in the mainstream economy (see also Palma Mora, 2003). Moreover, the interviewees had access to “advantaged” informal social milieus that help foster business. Their social networks were built/expanded via an array of informal and formal channels, which are enhanced by their status as “welcomed” foreigners.
This paper presents some results of the project “Brain drain or brain exchange?: Migration from Southern Europe to the New Emerging Mexican Cities”, funded by CONACYT (Consejo Nacional de Ciencia y Tecnología), project number PDCPN2013-01-212208.
An analysis by city of residence is beyond the scope of this article. This is partly because the number of the interviewed employers/self-employed workers (thirty-four) does not allow explain differences bin local business structure opportunities by locality. However, for the whole survey (129), a previous article explores differences in the labour incorporation of the interviewed skilled immigrants in the four local labour markets (Mendoza, 2018).