Mexico's January unemployment rate came in at a
seasonally-adjusted 4.8%, unchanged from December but still higher
than the 4.6% registered in November. The rate of joblessness
now sits exactly at its six-month moving average. The report
was released today by INEGI, the official statistics agency.
unemployment is far below its peak of 6.0% in the last recession,
and it is modestly better than the 5.2% rate in January 2013.
Nevertheless, the labor market has seen little appreciable change
since mid-2013. That should be no surprise, given that
Mexico's exports have recently been flat to down, and given that
important domestic sectors such as construction and government
spending have been very weak. The lethargic labor market has
weighed heavily on Mexican consumer spending. These problems
all help explain why the country's economic growth slowed so much
in the fourth quarter. They also suggest that growth will
remain relatively weak in the near term.
Patrick Fearon, CFA
Vice President, Fund Management
Mexico's Unemployment Rate
Seasonally Adjusted, Percent