Close to 60 Percent of Mexico's Workforce are in the Informal Economy Milenio
go to original January 23, 2013

Don't ever let anyone tell you your height will stop you from being a successful windshield cleaner. This gentleman is well-versed in the art of minivan-perching. (midwesternerinmexico.com)

Mexico City - The rate of informal employment in the country stood at 59.22 percent in December [2012], meaning that 28.8 million employed people worked in activities that contributed little or nothing productive in terms of the formal national economy.

For analysts, informality has been just one of the escape valves that has allowed Mexico's unemployment rate to remain relatively low, especially if compared to other OECD member countries.

As for the rate of under-employment, i.e., the indicator that measures those people who reported having both need and availability to work more hours, the INEGI reported that it reached a level of 7.6 per cent in December of 2012, which was less than the 8.2 percent reported the previous year. This means that 3.7 million people are under-employed.

Finally, the rate for critical employment conditions stood at 11.85 percent for the period in question, i.e., 5.7 million people in that condition, which includes:

• People working less than 35 hours a week;  
• People working over 35 hours a week, but whose monthly incomes are below the minimum wage [currently 60 pesos per day, or about USD $6.00]; and
• People who work more than 48 hours weekly earning up to twice the minimum wage.

Note: In December, 2012, National Institute of Statistics and Geography [INEGI] President, Eduardo Sojo, acknowledged that "the Mexican labor market is characterized by a group of workers who are vulnerable because they are not within a legal framework; the informal term is synonymous with vulnerability because there is a lack of [employment] contracts and where to register protest in case of unfair dismissal." Because they are outside the legal framework, workers in the informal economy have no benefits (health, pension, vacation, traditional year-end bonuses).

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Posted by Jane Brundage at Mexico Voices

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