Mexico Achieves Record High in Formal Employment for October

New data from the Mexican Social Security Institute (IMSS) reveals that Mexico’s formal sector employment reached an all-time high, with over 22.3 million people currently employed. In October alone, more than 173,000 new jobs were added, making it the fourth-best October for job creation. However, it’s worth noting that the total number of new positions in October 2023 is 16.7% lower than in the same month last year.

On October 31, there were a total of 22,302,690 formal sector workers registered with IMSS, marking the highest figure ever recorded. Out of this workforce, 86.1% held permanent positions, while the remaining 13.9% were in temporary roles.

Between January and October, Mexico created 929,794 formal sector jobs, with just under three-quarters being permanent positions. This number surpasses the 10-year average by 208,532 jobs, a 29% increase. Nevertheless, job creation in 2023 has been 6.7% lower than in the first 10 months of the previous year.

October Stats:

In October, IMSS reported the addition of 173,257 formal sector jobs, of which 140,489 were permanent positions, accounting for over 80% of the total. The remaining positions were temporary. While the overall number of jobs created in October 2023 was nearly 17% lower than in the same month in 2022, the number of new permanent positions only decreased by 1.2% compared to the previous year. Over the year from October 2022 to October 2023, the construction industry in Mexico experienced remarkable growth, with a 9% increase in the total number of IMSS-affiliated workers.

This surge in employment surpasses any other sector and has been largely driven by a combination of public and private sector projects, including those related to the nearshoring phenomenon.

The data from IMSS also reveals year-over-year employment increases in various other sectors:

• Transport and communications saw a 5.5% growth in employment.
• The commerce and retail sector experienced a 3.9% increase in jobs.
• Company services recorded a 3.6% rise in employment.
• Social and community services reported a 2.4% uptick in jobs.
• The electricity sector saw a 1.8% increase in employment.
• Manufacturing experienced a 1.2% growth in job opportunities.

In contrast, both the agricultural and mining sectors saw year-over-year employment decreases of 2.3%. These fluctuations in employment across sectors reflect the dynamic nature of the job market in Mexico.

As of the close of October, the average daily base salary for employees affiliated with IMSS stood at 531.5 pesos, which is approximately equivalent to $30 at the current exchange rate. Extrapolating this daily wage to a 30-day month, the average monthly salary before taxes and benefits amounts to 15,945 pesos, or about $913.

IMSS has reported that salaries have witnessed a substantial increase of 10.8% over the past 12 months. Furthermore, it highlighted the consistent upward trajectory of wages, noting that salaries have risen by more than 6% each year since 2019, marking the first full year of the present government. These developments indicate ongoing improvements in compensation for formal sector workers in Mexico.

Curious to learn more? Explore our articles on Mr. Business Magazine