MexECON Blog

February Unemployment Unchanged at 4.7 Percent

Mexico's February unemployment rate came in at a seasonally-adjusted 4.7%, unchanged from the revised rate in January.  The rate of joblessness now sits slightly below its six-month average of 4.8%, and it is modestly lower than the 4.9% reading in February 2013.  The report was released today by INEGI, the official statistics agency.

Comment:  Mexican unemployment remains far below its peak of 6.0% during the last recession.  However, the improvement has been frustratingly slow, and policymakers at Banco de México noted in their policy statement last week that there is still significant slack in the labor market.  The main culprits are now soft exports and a virtually freeze in the construction industry.  Because of the lack of appreciable improvement in the labor market and a hike in sales taxes at the beginning of 2014, Mexican consumer confidence has fallen sharply in recent months, and retail demand has cratered.  Mexican economic growth is therefore likely to remain tepid in the near term.

Patrick Fearon, CFA
Vice President, Fund Management

                                          Mexico's Unemployment Rate
                                           Seasonally Adjusted, Percent
                                                     Source:  INEGI
Unemployment 1402

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