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Employment Outlook: Mexico

2017-03-23
by Mary Anne Thompson, founder and president, Goinglobal, Inc

Facing economic uncertainty due to its informal job sector and the U.S. administration’s call for a trade renegotiation, Mexico pushes forward with jobs to fill and talent to find.   

By Mary Anne Thompson, founder and president, Goinglobal, Inc. 

The world’s most populated Spanish-speaking country, Mexico is the second-largest economy in Latin America and the 12th largest in the world. Overall unemployment in the country stands at a relatively low 4 percent, but youth unemployment sits at 8 percent. And, despite all sectors hiring last year, approximately 7.7 percent of the population is under-employed, according to the National Survey of Occupation and Employment (ENOE). 

Job growth can be seen in many sectors, particularly in the trade and services industries, but there are concerns about Mexico’s economy going forward. Long hampered by corruption, high inequality and low productivity, there is also a large informal job sector, accounting for 57 percent of total employment, taking a toll on the larger economy. Informal jobs are prevalent in small and medium-sized enterprises (SMEs), including 60 percent of the construction workforce. 

A new concern for the country is the US administration’s call for a renegotiation of the North American Free Trade Agreement (NAFTA), enacted in 1994, which eliminated most tariffs. The possible changes in trade relations with the US could have a negative effect on the Mexican economy. 

Employment Outlook 

Short Term 

Hiring intentions are expected to remain steady for the near future, with more than 78 percent of surveyed employers not planning to make any staff changes, according to a recent Manpower employment survey. Sixteen percent of employers surveyed nationwide expect to add new employees. The most substantial hiring intentions are in the manufacturing and communications, and transport sectors. 

Selected Occupations with the Lowest Rate of Unemployment 

  • Physicists
  • Chemists
  • Teaching instructors
  • Statisticians
  • Historians and archaeologists
  • Public health workers
  • Transportation services workers 

Long Term 

The unemployment rate is expected to hover around 4 percent through 2018. Major challenges facing the labor market are related to the large informal job market and a lack of skilled labor. However, the IMF (International Monetary Fund) predicts unemployment will fall to under 3.8 percent by 2021, and the World Bank predicts Mexico will be the world’s fifth-largest economy by 2050. 

By Sector

Although all sectors except mining, construction and government have continued to grow, the services sector has seen the strongest growth over the past year. This is especially true for the telecommunications, professional services and financial industries. The sectors predicted to grow the most this year are insurance and financial services, IT, electricity, water and gas supply, and corporate and company leadership. 

By Region 

The states with hiring intentions above the national average are Coahuila, Colima, Sinaloa, Yucatán, Nuevo León, Zacatecas, Baja California, Hidalgo, and the state of México. 

As far as cities are concerned, Tijuana, Monterrey, Mérida and Chihuahua are the urban centers where employment is expected to grow the most – by between 15 and 20 percent – in the following months. The hiring outlook for Mexico City is about average. 

Most of these new jobs will be in big companies (with 250 employees or more), since large businesses are where 25 percent of new employment intentions have been registered. 

The regions with the best outlooks are the Northwest (Baja California, Baja California Sur, Sinaloa and Sonora), the Northeast (Nuevo León, San Luis Potosí, Tamaulipas and Veracruz) and the Valley (Mexico City and Metropolitan Area). 

Areas of Job Promise 

Talent Shortages 

As more and more foreign companies open new facilities in Mexico or expand existing ones, demand for talent continues to grow. About 40 percent of employers in Mexico report a shortage of talent, the same as the global average, according to Manpower. 

The top ten hardest jobs to fill 

  1. Production and machine operators
  2. Sales representatives
  3. Secretaries, receptionists, administration and office support staff
  4. Technicians
  5. Skilled trades
  6. Engineers
  7. Management and executive professionals
  8. Laborers
  9. Accounting and finance professionals
  10. IT professionals 

Mexico is facing major talent shortages in its energy, aerospace, telecommunications and pharmaceuticals sectors. 

Salaries 

General Salary Trends 

Mexico has the highest level of income inequality among OECD (Organisation for Economic Co-operation and Development) countries despite having programs in place to reduce poverty. The richest 10 percent of the population earns 20 times more than the poorest 10 percent. 

The average annual income in Mexico is 12,806 USD per year, less than half of the OECD average of 29,016 USD. The daily minimum wage was recently raised from 73.04 MXN to 80.04 MXN. 

Best Paying Careers in Mexico 

  • Physicists
  • Finance professionals: banks and insurance
  • Transportation services workers
  • Historians and archaeologists
  • Public health workers
  • Earth and atmospheric scientists
  • Statisticians
  • Mineral extractors
  • Medical professionals 

Conclusion 

Mexico faces an uncertain economic future, as corruption, an informal job sector and the U.S., challenge its status quo and growth potential. Its current jobs climate is stable, however, with hiring taking place across many sectors and the need for talent increasing. 

http://www.goinglobal.com/

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