Because low wages and high unemployment are good for corporate profits.  Mulroney was the first of the new breed of corporate-owned politicians (others to follow: Bill Clinton, Tony Blair, Obama, etc...) so he was following the corporate agenda.

Everyone knew Mexico's low wages and poor working conditions would undercut Canadian workers.  That's why NAFTA was created in the first place: to drive down wages and weaken the bargaining power of workers.

If they could have included TFWs in the original NAFTA, they would have done it in a New York millisecond.