Mexico | Labor Market: Moderation in employment and real wage bill

Summary

Formal employment in Mexico shows clear signs of deceleration, reflecting an adverse economic environment marked by domestic and global uncertainties. Although real wages have remained somewhat resilient, job creation faces significant pressures that negatively impact the total wage bill.

Key points

• Key points:
• Formal employment recorded a modest annual growth rate of just 0.8% in March, confirming stagnation observed during the year's initial months.
• Domestic factors, such as judicial reform and external factors, notably the U.S. imposition of tariffs, have significantly weakened business confidence.
• Key sectors such as services and commerce are beginning to exhibit signs of deceleration, slowing their positive contribution to formal employment.
• Meanwhile, construction and manufacturing sectors remain negative, experiencing several consecutive months of contraction.
• Despite an annual increase in real wages (3.4%), the total wage bill clearly shows signs of weakening due to subdued job creation, posing risks to domestic consumption dynamics.

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