Manufacturing production volume declined by 2.7% in July, according to official data from the National Institute of Geography and Statistics (INEGI). The slowdown comes after two months of growth, and contrasts sharply with the growing value of Mexico’s manufacturing exports.
Production volume also decreased year-over-year, declining 1.1% compared to the same month in 2024.
Both internal and external pressure have contributed to the industry’s slowdown. Economic uncertainty, low levels of productive investment, and reduced domestic and international demand have weakened the sector. Inflationary pressures and international risks have further constrained manufacturing activity, specially in subsectors such as textiles, wood and apparel.
INEGI also shows a 0.2% decrease in manufacturing employment, marking the sixth consecutive month of decline. Self-employed workers (independent contractors) were particularly affected, experiencing a 2.1% decline in July. The same self-employed workers have experienced a dramatic 16% drop in employment since last year.
The number of hours worked fell by 0.2% in July compared to June, and 2.2% compared to 2024. Meanwhile, people employed in the manufacturing industry declined 0.2% in the monthly comparison, which is equivalent to 19,000 jobs lost in July. The industry has lost 221,000 jobs since July 2024, a 2.3% decline.
The textiles and apparel sector are the hardest hit (down between 8-9%), along with the manufacturing of textile inputs and textile finishing (down 9%). Other manufacturing industries, such as oil and metals, weathered the impact better.
Industrial activity in Mexico falls for fourth consecutive month
The only positive data point was a 0.7% monthly increase and a 6% annual increase in average real wages within the manufacturing industry. With an average salary of 12,600 pesos, this translates to an increase of just 90 pesos per worker per month.
Overall, the sector’s 9.6 million employees received an additional 865 million pesos (US $47 million) in payroll.
Exports up in July
The manufacturing production’s slowdown sharply contrasts with INEGI’s data regarding July exports, which grew 4% in value compared to the same month last year, reaching US $56.7 billion in total exports. Mexico’s exports were worth US $54.78 billion in July 2024, which in turn increased by 14.7% compared to the same month of the previous year.
Interestingly, this growth is primarily attributed to the manufacturing sector, which contributed more than 90% of total export value, amounting to US $52.3 million in July alone.
Manufacturing exports offset the contractions in export value for other sectors, such as oil, which fell 23% year-over-year to US $1.9 billion, and the automotive sector, which also saw export value decline 7% to US $15.9 billion. Within the latter, exports to the United States fell 9.2%, although a 4.9% increase was observed to other destinations.
With reports from El Economista
