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Unemployment hits historic low despite tough economic conditions

MND Staff
By MND Staff
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Construction workers at a work site, illustrating Mexico's low unemployment rate
Unemployment in Mexico dropped to 2.4% in December, the national statistics institute reported. (Galo Cañas/Cuartoscuro)

Official unemployment reached a 20-year low in December even as Mexico’s economy contracted for the first time since 2021.

The national statistics institute INEGI reported that 60.8 million people were “economically active” in December, an increase of 66,000 over December 2023.

At the same time, data for the fourth quarter of 2024 showed that nearly 61.4 million people were “economically active” during the final three months of last year.

INEGI defines the economically active population (PEA) as including anyone 15 years and older who is employed or actively looking for a job.

However, INEGI reported that nearly 7% of the population — 4.1 million people — was found to be underemployed, with respondents indicating they needed more hours or were looking for a second job.

At the same time, the INEGI report indicates that, of the 60.8 million economically active Mexicans, 31.8 million are employed in the informal sector.

Woman selling tacos
More than half of Mexico’s economically active population is employed in the informal sector, without access to government benefits. (Cuartoscuro)

The survey found that only 1.5 million people are considered “unemployed,” 109,000 fewer than in December 2023.

As such, Mexico’s official employment rate is 2.4%, a figure that prompted President Claudia Sheinbaum to declare in a social media post that Mexico has the lowest unemployment rate in the world.

Financial analyst Mario di Costanzo, a former congressman, was less sanguine.

In a response to Sheinbaum’s declaration, Di Costanzo said the government is misleading the public. He pointed out that the millions of folks in the informal economy represent 54% of the PEA, and they are “[w]orking without social security, without benefits and without minimum wage!”

Though many countries claim to have unemployment rates lower than Mexico’s current figure, the use of different counting methods makes accurate comparison difficult. (Claudia Sheinbaum/X)

The employment data was released on the same day that INEGI reported that Mexico’s GDP shrank 0.6% in the October-December quarter as compared to last year’s third quarter.

The contraction was the first since 3Q 2021, and larger than the 0.2% economic decline forecast by economists surveyed by Reuters.

Annual growth for 2024 was 1.5% in real terms and 1.3% in seasonally adjusted terms, INEGI said.

With reports from El Imparcial and La Crónica

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