MexECON Blog

September Unemployment Rises to 4.9 Percent

Mexico's September unemployment rate rose to a seasonally-adjusted 4.9%, up from a 4.8% reading in August but equal to the figure in July.  The increase in September came after a string of four months in which joblessness was either steady or declining.  The report was released today by INEGI, the official statistics agency.

Comment:  In spite of the modest rebound in unemployment during September, the Mexican labor market seems to be doing better than it was earlier in 2013.  The improvement probably stems in large part from the acceleration in Mexican exports over the summer, which has lifted manufacturing activity.  Coupled with a recent cooling in inflation, better job prospects could help encourage consumers to start spending more aggressively again.  Nevertheless, Mexico still faces headwinds from tight fiscal policy, falling construction activity, and worries that the U.S. fiscal impasse will reduce U.S. demand again.  Because of those challenges, Mexico remains at risk of sliding into recession.

Patrick Fearon, CFA
Vice President, Fund Management

                                          Mexico's Unemployment Rate
                                            Seasonally Adjusted, Percent
                                                      Source:  INEGI
Unemployment 1309

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