Mexico recovers 80% of jobs lost to the pandemic

16/02/2021

Mexico is recovering employment, but it is doing so more and more slowly. The Latin American country closed 2020 with 2.3 million more employed people than in the third quarter, according to data published Monday by the National Institute of Statistics and Geography (Inegi).

The pace of job creation slows in the fourth quarter of 2020 as the effect of the reopening wears off. Image: Undraw.co
The pace of job creation slows in the fourth quarter of 2020 as the effect of the reopening wears off. Image: Undraw.co

The end of the year leaves mixed results. Since employment bottomed out in the second quarter, the employed population in both the formal and informal economy has shown significant progress and now stands at 53.3 million people. In the fourth quarter, there were 8.2 million more employed people than in the months of strict confinement, when some 10 million people stopped reporting employment.

Even so, pre-pandemic levels have not yet been recovered. Employed persons are 2.4 million fewer than a year ago. And the recovery has lost steam compared to the months following the reopening of the economy. From the second to the third quarter, the number of employed people increased by 5.9 million, a jump that is twice as large as in the last months of the year. Economist José Luis de la Cruz points to "a structural affectation of the labor market". "Despite the reopening, the employed population has no longer recovered in large numbers after October," he points out.

The rebound is not the same for everyone either. Women have borne the brunt. In the fourth quarter, 32.6 million men were employed, down 1 million from a year ago, while 20.7 million women were employed, down 1.3 million from the same period a year earlier. School closures have forced many mothers to stay home while their children watch classes on television. Added to this is the impact of the pandemic on small informal businesses, which tend to have a strong female presence. In the last months of the year, these businesses recorded 914,000 fewer jobs than at the end of 2019.

By sector, hospitality and manufacturing remain the most affected by the crisis. Hospitality reported 769,000 fewer employed than in the same period of 2019 and industry, a reduction of 464,000. The fourth quarter of the year coincided with a tightening of restrictions in several parts of the country, including Mexico City and the northern industrial states, in the face of the new wave of contagions.

Apart from unemployment, the pandemic has brought with it an increase in precariousness. Mexico closed 2020 with 3.8 million more underemployed - employed people who are available to work more hours - than in the same period of 2019, for a total of 8.1 million, 15.3% of the employed population. This is an improvement over the harshest months of confinement, when the underemployed climbed to 25.1% of the employed population, although the figure is still above the pre-pandemic 8.5%.

Economist Marcelo Delajara, of the Espinosa Yglesias Center for Studies, points to precariousness as one of the characteristics of the current situation: "This recovery from the third quarter to the fourth is not only small in terms of new employment, but the employed population is 20% more precarious than before the pandemic". De la Cruz agrees: "The survey shows the advance of the precariousness of the Mexican labor market. What increased was the number of people working less than 15 hours. The rest had a drop".

By Mexicanist, Source: INEGI