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Mexico’s unemployment rate increases to 4.4 percent

Mexico City, Mexico — The National Institute of Statistics and Geography (Inegi) reports Mexico’s unemployment rate has risen to 4.4 percent in the first quarter of 2021, compared to 3.4 percent in the same period of 2020, a sign of the country’s slow recovery.

The agency says the unemployment rate from January to March of this year is just two tenths lower than in the last quarter of 2020. The ENOE (Encuesta Nacional de Ocupación y Empleo) reported an annual decrease of 1.6 million people in the economically active population, which went from 57 million to 55.4 million.

“In the pandemic year from 2020-Q1 to 2021-Q1, the employed population fell by 2.1 million people, falling from 55.1 to 53 million; employment has fallen almost 10 times more in commerce or services than in the industry,” commented Julio Santaella, president of El Instituto Nacional de Estadística y Geografía (Inegi).

In addition to more than 2.38 million infections and 220,000 deaths, the fourth highest figure in the world, the COVID-19 crisis caused in Mexico a contraction of around 8.2 percent of GDP.

The Government of President Andrés Manuel López Obrador has predicted a 5.3 percent rebound of GDP for 2021, with the promise of recovering the level of employment prior to the pandemic by the end of the year.

“We are not recovering what was lost, there is an urgent need for a change in the labor policy of this country. Furthermore, let us remember that the labor crisis did not begin as a result of the pandemic,” the Center for Studies for Formal Employment (CEEF) published in an analysis.

Ricardo Aguilar, an analyst at the Invex bank, pointed out that in April, only 44,474 positions were recovered, “the lowest level so far this year.”

“It is likely that the changes to the Federal Labor Law that prohibit the hiring of people under the outsourcing scheme in certain cases will discourage the generation of formal jobs,” Aguilar said.

By sectors, the statistics institute highlighted that persons employed in tertiary activities fell 1.9 million with the greatest impact in the commerce sector with a reduction of 712,000. In the restaurant and accommodation services sector, jobs fell by 656,000. Meanwhile, people engaged in micro-businesses decreased by 924,000