MexECON Blog

February Unemployment Falls to 5.2 Percent

In a report  last week, Mexico's preliminary February unemployment rate fell to 5.2%, after adjusting for seasonal variations.  In January, unemployment had risen to 5.5%.  Mexico's jobless rate in February was at its lowest level since early 2009.  However, the rate is still much worse than during the country's last boom period.  Throughout 2005-2008, Mexico's unemployment rate was consistently between 3.0% and 4.0%.

Comment:  Because of its economic structure, Mexico's unemployment rate often looks surprisingly low.  For example, relatively weak unemployment benefits and a large and flexible informal economy help to reduce the number of Mexicans reporting that they are unemployed.  The more important issue is the trend in the country's jobless rate.  On that score, Mexico has had declining unemployment since mid-2009, reflecting the strong economic rebound that has take place as exports to the United States turn up again.  The improvement in the labor market is probably one reason why recent figures on consumer demand have looked better than anticipated.  The fall in unemployment could help to ensure that the current economic recovery in Mexico continues.

Patrick Fearon, CFA
Vice President, Fund Management

  Mexico:  Unemployment Rate
In Percent, Seasonally Adjusted
            Source:  INEGI

Unemployment Prelim 1002

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