Mexico faces 10.4 million person labor gap

Mexico is facing a significant labor gap that extends far beyond official unemployment figures. According to the Inter-American Development Bank (IDB), the labor gap in Mexico reaches 10.4 million people, representing 15.7% of the potential workforce. This metric includes not only the unemployed but also those working fewer hours than desired and those who have ceased looking for work due to discouragement.

Additionally, nearly 14.9 million Mexicans aged 15 to 29 are currently excluded from education, trapped in precarious labor conditions, or living in poverty. The Youth with Decent Work Alliance notes that this population has only decreased by 1.5 million over the last four years, suggesting a slow pace of improvement.

Other economic trends in the region include the increasing impact of generative AI on Mexico’s formal workforce and the pressure on remittance flows caused by migrant job losses in the United States.