Banxico Raises Growth Target, Aims for 800,000 Formal Jobs
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Banxico Raises Growth Target, Aims for 800,000 Formal Jobs

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Sofía Garduño By Sofía Garduño | Journalist & Industry Analyst - Thu, 06/01/2023 - 12:18

The Bank of Mexico (Banxico) has raised its growth target for 2023 from 1.6% to an ambitious 2.3%. This decision has far-reaching implications for the country's economy, as it is expected to result in the creation of up to 800,000 formal jobs registered with the Mexican Social Security Institute (IMSS). 

With the revised target, an additional 180,000 jobs are projected to be created this year compared to previous estimates.

Mexico witnessed a significant surge in job creation in 1Q23, with 423,384 positions added to the workforce, according to México cómo vamos. This figure represents the highest number of jobs created in 17 years, underscoring the positive trajectory of Mexico's labor market. Furthermore, the target of generating 100,000 jobs per month set by the government was successfully achieved during this period. 

All states in Mexico demonstrated positive annual growth in the same period compared to the previous year. The top three states that experienced the highest growth rates were Tabasco, Baja California Sur and Quintana Roo. This widespread growth indicates a healthy and resilient economy across the country. According to the OECD, Mexico boasted the second lowest unemployment rate among its member countries in 1Q23.

Various sectors in Mexico experienced notable annual growth in job opportunities. The construction sector recorded a 6.8% increase, followed by transportation and communications with 6.4% and business services with 4.5%. These numbers signify the resilience and vitality of these sectors, which play a crucial role in driving Mexico's economic growth.

The tourism sector also made a significant contribution to employment figures, representing 8.9% of the national workforce during 1Q23. With a total of 4.678 million individuals employed in this sector, tourism continues to be a key driver of job creation in Mexico, reported today Mexico’s Ministry of Tourism. 

The income of Mexican workers has grown in recent years. In the 4Q22, the average monthly income reached $7,495 pesos (US$426.9), reflecting a real increase of 5.8% since late 2018. Notably, informal workers experienced even higher income growth, with a 6% increase during the same period compared to a 3% increase for formal workers, as reported by IMCO.

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