Informal Employment Reaches 30 Million Mexicans

The number of people working informally in Mexico rose above 30 million people in March 2021, a level not seen since the same period last year, when the economic crisis due to COVID-19 kicked off in the country. According to INEGI data, from February to March alone, 1.2 million people were added to this sector of the economy, bringing the total to 30.6 million people. The labor informality rate stood at 56.8 percent in March, from which men accounted for 57 percent while the female rate stood at 55 percent. 

According to INEGI, labor informality includes those labor vulnerable due to the nature of the economic unit in which they participate, as well as those whose labor relation or dependence is not recognized by their employer. The OECD pointed out that Mexico needs a strategy to reduce informality. “A comprehensive strategy to combat informality is needed to ensure that the economic recovery generates formal jobs, which would contribute to inclusiveness,” the agency said in its report Economic Policy Reforms 2021.

With the approval of the outsourcing reform this week by the Senate, analysts warn that this could generate more informality in the country. According to an analysis by ManpowerGroup, with this new scheme, 70 percent of employers will turn to informal or semi-informal hiring or layoffs.

More news below:

• Latin America, one of the regions most affected by the pandemic, should keep expansionary fiscal policies in place to boost economic recovery and mitigate the negative effects of the crisis, the Economic Commission for Latin America and the Caribbean (ECLAC) said on Wednesday. The 3.7 percent economic growth expected in the region by 2021 will not make up for the downturn experienced in 2020, nor will it reverse the increases in poverty and inequality, the agency said. 

• Homely, a local startup that links cleaning professionals with clients, wants to be a driver for social change, reports TecReview. The company’s goal to generate social change allowed it to win the Platzi DemoDay 2021 Award, a program created by Platzi to properly connect and push forward promising startups. Platzi named Homely its official winner on Twitter. The program has strengthened startups like Urban Roosters and Terapify, according to its website.

• Initial unemployment claims in the US fell below 600,000 for the second week in a row, Bloomberg reported this week. According to Labor Department figures, a total of 547,000 initial claims were reported in the week ended Apr. 17, the lowest since the start of the pandemic. “This is the lowest level of initial claims since Mar. 14, 2020, when it was at 256,000,” the department said.