Mexico | Formal employment loses momentum and declines in July

Summary

Formal employment in Mexico posted a monthly contraction of 0.05% in July. Annual growth slowed to 1.5%, and to 1.0% excluding digital platform workers. This dynamic is attributed to weak investment and low business confidence, despite an acceleration in real wages.

Key points

• Key points:
• The agricultural sector recorded a sharp annual employment contraction of 5.6%, accumulating 35 consecutive months of declines, suggesting a structural deterioration.
• Construction declined again (-0.99% MoM in seasonally adjusted terms); in contrast, manufacturing posted four consecutive months of monthly gains, although employment in the sector remains down 0.7% YoY.
• At the regional level, employment is uneven: the metropolitan area shows the best performance, while the southeast region presents the greatest deterioration, with an employment level 1.9% below that of December 2023.
• At the state level, 11 states had annual employment declines. Noteworthy contractions occurred in Campeche (-7.5%) and Tamaulipas (-2.5%), while Baja California led growth at 7.0%.
• Real wages accelerated, with annual growth of 3.5% in July, driven by a 6.7% increase in nominal wages and lower inflation (3.1%).

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