MexECON Blog

June Unemployment Unchanged at 5.1 Percent

Mexico's June unemployment rate came in at a seasonally-adjusted 5.1%, unchanged from May and April but higher than the 5.0% rate in March.  Joblessness in Mexico remains slightly above its six-month average.  The report was released today by INEGI, the official statistics agency.

Comment:  During the spring, the Mexican economy appeared to be in a tentative rebound from its soft spot at the turn of the year.  However, recent data suggests the economy may be stalling again.  U.S. economic growth remains modest, stunting the demand for Mexican exports and putting a damper on Mexico's manufacturing sector.  Construction activity has fallen in response to changes in the government's housing programs and spending disruptions related to the December inauguration of Mexico's new president.  Those problems alone would have discouraged hiring, but weaker employment prospects and a surge in inflation earlier this year have also weighed on consumer confidence and spending, helping create a negative feedback loop.  If the U.S. economy reaccelerates later in 2013, as many observers expect, the Mexican economy could strengthen and joblessness could start to recede again.  However, it is still too early to know if or when that will really happen.

Patrick Fearon, CFA
Vice President, Fund Management

                                            Mexico's Unemployment Rate
                                              Seasonally Adjusted, Percent
                                                       Source:  INEGI
Unemployment 1306

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