The labor market situation in Mexico before and during COVID-19

Abstract

Labor market indicators showed significant improvements during 2018 and 2019, in particular, the employed population without benefits presented its lowest level in 15 years, which represents a decline in labor precariousness. Unemployment decreased during March to 3.3%, the same as labor informality to 55.8%. The real minimum wage had its greatest recovery since 1976 and reached the purchasing power equivalent to that of 1991. The above data reflect that before the economic paralysis derived from the health contingency, the labor market had satisfactory results. During the pandemic, it can be observed that the reduction of mobility in workplaces had positive results in reducing the rate of infection. However, the entities that reduced mobility to a lesser extent have higher levels of labor informality. Based on different models, it is possible to indicate that labor precariousness is a structural cause for facilitating the spread of COVID-19.  Without containment measures, it is estimated that 725 thousand jobs will be lost between April and May.