What Is the Current Unemployment Rate in Mexico?

The unemployment rate in any nation serves as a crucial indicator of its economic health and the well-being of its workforce. For Mexico, this metric offers insights into the country’s labor market dynamics and overall economic performance. A low unemployment rate can signal a robust economy, with ample job opportunities for its population. Conversely, a high rate may point to economic stagnation or structural challenges within the labor force. Understanding Mexico’s unemployment rate is therefore important for both domestic policy-making and international economic observers, as it reflects the country’s capacity to generate employment and sustain economic activity.

Current Unemployment Figures

Mexico’s National Institute of Statistics and Geography (INEGI) reported the unemployment rate at 2.7% for the second quarter of 2025. This figure reflects the percentage of the economically active population that is without work but actively seeking employment. The economically active population (PEA) in Mexico stood at 61.1 million in the second quarter of 2025.

Within this population, approximately 59.4 million people were employed, while 1.6 million were actively looking for work during the second quarter of 2025. Gender disparities in unemployment were minimal, with the rate for women at 2.8% and for men at 2.7% as of May 2025, though earlier in March 2025, women’s unemployment was slightly higher at 2.3% compared to men’s 2.2%. A significant aspect of the Mexican labor market is the prevalence of informal employment, which accounted for 54.8% of the workforce in the second quarter of 2025. Underemployment, which measures individuals working fewer hours than desired, also registered at 7.4% in the same period.

Understanding How Unemployment is Measured

Mexico’s unemployment rate is primarily derived from the National Survey of Occupation and Employment (ENOE), conducted by INEGI. This survey is designed to collect comprehensive statistical information on the characteristics of the workforce and occupational patterns across the nation. The ENOE defines the “economically active population” (EAP) as individuals aged 15 years and over who are either employed or actively seeking employment.

An individual is considered “unemployed” if they are without work, available to work, and have actively sought employment within a specified reference period. The survey utilizes a probabilistic, two-stage, stratified, and clustered sampling design, with the housing unit serving as the observation unit. This methodology aims to provide a representative snapshot of the Mexican labor market. A notable aspect of Mexico’s labor statistics is the inclusion of the informal sector, which encompasses workers in unregistered economic units, often micro-businesses, that lack formal fiscal obligations or access to social security benefits. This large informal sector plays a crucial role in absorbing labor, and its existence is often cited as a reason for Mexico’s comparatively low official unemployment rate.

Key Factors Affecting Unemployment

Several intertwined factors influence Mexico’s unemployment rate, reflecting the complex interplay of economic, social, and policy elements. Overall economic growth, measured by Gross Domestic Product (GDP), directly impacts the creation of jobs. Mexico’s economy averaged 2% GDP growth from 1994 to 2023, with a 3.1% growth in 2023, which generally supports employment generation. Stronger economic activity typically translates into increased demand for labor across various sectors.

Performance across specific industries also plays a significant role in shaping employment figures. The manufacturing sector is a major recipient of foreign direct investment, contributing substantially to job creation, particularly through export-oriented industries. The services sector, however, is the largest employer in Mexico, accounting for 63.5% of the employed population, followed by commerce at 19.2% and agriculture at 9.6%. Foreign direct investment (FDI) is a significant driver of employment, with Mexico consistently attracting substantial foreign capital due to its proximity to the United States, preferential market access, and a skilled workforce.

Government policies are instrumental in influencing labor market outcomes. Recent labor reforms, such as the New Labor Model implemented in 2019, aim to promote formal employment and improve working conditions, including initiatives like the “Youth Building the Future Program” and the prohibition of outsourcing. The ban on outsourcing, for instance, led to increased average salaries and profit-sharing for millions of workers previously in outsourced roles. However, Mexico’s labor market also faces structural challenges, including the substantial informal economy, which acts as a buffer by absorbing labor that cannot find formal employment.

The absence of a comprehensive national unemployment insurance program means that many individuals cannot afford to be openly unemployed for extended periods, driving them into informal work to secure immediate income. This structural characteristic contributes to Mexico’s low official unemployment rate but highlights underlying vulnerabilities in job quality and social protection. Demographic factors and educational attainment also influence unemployment, with youth unemployment generally higher, particularly for those aged 16 to 25. Surprisingly, unemployment can sometimes be higher among individuals with secondary education compared to those with less education, as more educated job seekers may prolong their search for positions deemed more suitable for their qualifications.

Unemployment Trends and International Context

Mexico’s unemployment rate has generally followed a downward trend over the past decade, reaching some of its lowest levels since the early 2000s. While it experienced a spike during the COVID-19 pandemic, reflecting global economic disruptions, the rate has since recovered. Historically, Mexico’s unemployment rate averaged 3.68% from 1994 to 2025, reaching an all-time high of 6.42% in September 2009 during the global financial crisis and a record low of 2.20% in March 2025. Over the last few years, the rate has consistently remained below the 3% threshold, indicating a tight labor market. For instance, the annual unemployment rate was 2.71% in 2024, a slight decline from 2.77% in 2023.

When compared to its key trading partners, Mexico’s unemployment rate appears notably lower. In 2024, Mexico’s unemployment rate was 2.7%, while the United States recorded 4.1% and Canada had 6.5%. This comparison suggests a degree of economic competitiveness and stability within Mexico’s labor market.

However, these comparisons must be interpreted with an understanding of Mexico’s unique labor market structure. The country’s large informal sector, where over half of the workforce is engaged in jobs without formal contracts or social security benefits, acts as a significant shock absorber. The lack of a national unemployment insurance system means that individuals are often compelled to accept informal work rather than remain openly unemployed for extended periods. Therefore, while the official unemployment rate is low, it does not fully capture the prevalence of underemployment or the challenges associated with precarious informal work.