Mexico’s unemployment rate fell to 2.5% in October, down from 2.9% a month earlier, according to official data.

The national statistics agency INEGI reported Tuesday that 1.53 million people were unemployed at the end of October, a reduction of 254,000 compared to the end of September.

The unemployment rate in October was not far off the record low of 2.3% in March.

Mexico’s economically active population — people aged 15 or over who are working or looking for work — was just over 61.4 million people in October, according to INEGI.

The size of Mexico’s total workforce increased by almost 446,000 in October compared to September to reach 59.87 million. October was Mexico’s second-best month this year for job creation.

The increase in the size of the Mexican workforce in October — considering both formal and informal sectors of the economy — came after some 276,000 jobs were lost in September.

Juan Carlos Alderete, head of economic analysis at Banorte, said that the latest jobs data suggested that “weakness seen on certain fronts” in recent months was only temporary.

The creation of more than 445,000 jobs in October occurred despite a slowdown in the Mexican economy.

Mexico’s economy grew just 1.5% in annual terms in the first nine months of the year, compared to 3.2% in 2023. The Bank of Mexico is forecasting that economic growth this year will be just 1.2%.

Colima has Mexico’s lowest unemployment rate, Tabasco the highest 

INEGI data shows that the unemployment rate in the small Pacific coast state of Colima was just 1.2% in October, lower than any other state.

Nine other states had unemployment rates below 2%: Campeche, Guanajuato, Guerrero, Hidalgo, Jalisco, Michoacán, Morelos, Oaxaca and Puebla.

The Gulf coast state of Tabasco had the highest unemployment rate among Mexico’s 32 federal entities in October. Of the state’s economically active population, 4.1% didn’t have a job.

Ten other states had unemployment rates of 3% or higher in October: Coahuila, Chiapas, Mexico City, Durango, Querétaro, Quintana Roo, San Luis Potosí, Sonora, Tamaulipas and Zacatecas.

60% of new jobs created in October are in the formal sector 

Of the 446,000 new jobs created in October, 269,000 are in the formal sector and 177,000 are in the informal sector.

In October, 54.1% of all people with jobs worked in Mexico’s vast informal sector, which includes street vendors and many domestic workers.

Informal workers don’t pay income tax and don’t have access to formal employment benefits such as holiday pay and access to the Mexican Social Security Institute health care program.

Over 700,000 jobs added this year 

In the first 10 months of the year, the size of Mexico’s workforce increased by 723,563.

The newspaper El Economista reported that Mexico recorded net job additions in five months — February, March, May, July and October — and net job losses in January, April, June, August and September.

Of Mexico’s 59.87 million workers at the end of October, around 5.6 million, or 9.4% of the total, were classed as underemployed, meaning they would like to work more hours.

With reports from El Universal and El Economista