Image credits: Henry & Co.
/
News Article

Mexico Cuts Unemployment Rate but Subemployment Remains Strong

By Jorge Ramos Zwanziger | Thu, 07/29/2021 - 12:31

In June 2021, Mexico had an unemployment rate of 4 percent, representing over 2.3 million people, tweeted Julio A. Santaella, President of INEGI Informa. The recent unemployment rate, however, represents a contraction from June 2020’s 5.4 percent, indicated INEGI

Since the beginning of the crisis caused by the COVID-19 pandemic, Mexico experienced  one of the largest drops in employment figures of the OECD area. “Currently, the labor gap is already showing some signs stagnation […] and we think that over the next few months the labor market will face new challenges given the complication of the pandemic in recent weeks,” reports an analysis from Monex. The primary sector was responsible for 46 percent of job generation for Mexico with over 647,000 jobs. In total, in a single year Mexico recovered about 1 million jobs for the country.

According to El País, the pandemic worsened working conditions for thousands of Mexicans. About 25 percent of Mexico’s economically active population works in inadequate conditions, faces long working hours or receives precarious payment. Work hours have increased by 8 percent, making employees work 35-48 hours per week.

“There has been a change in the quality of employment," said Marcelo Delajara, from the Espinosa Yglesias Study Center (CEEY), to El País, because many Mexicans went from having a job that ensures a certain income and gives them certain benefits such as insurance, to being self-employed. According to Delajara, “Self-employment, in Latin America, is always synonyms with vulnerability or precariousness and has increased a lot when compared to last year.”

However, the OECD recently published positive expectations regarding employment in the country. “Projections suggest that Mexico’s unemployment rate will be 0.5 percentage points higher than its pre-pandemic level in the last quarter of 2022,” explained the organization in its 'Employment Outlook 2021' analysis.

The data used in this article was sourced from:  
MBN, INEGI, Monex, El Pais
Photo by:   Henry & Co., Unsplash
Jorge Ramos Zwanziger Jorge Ramos Zwanziger Junior Journalist and Industry Analyst