To read this content please select one of the options below:

Mexico minimum wage hikes may drive labour informality

Thursday, February 9, 2023

Significance

The administration of President Andres Manuel Lopez Obrador (AMLO) has been among the more generous, viewing minimum wage increases as a way to boost the incomes of the poor, compensate for periods of neglect and, potentially, generate political rewards at the ballot box.

Impacts

  • Low wages will probably become an important issue in the 2024 presidential contest.
  • The legacy of decades of low productivity gains will see Mexican wages continue to lag those of some other emerging economies.
  • Although wages are low, the peso’s appreciation since early 2022 reduces their attractiveness for foreign firms.

Related articles

Expert Briefings logo