Mexico labor market faces rising informality and wage gaps

Mexico is facing significant labor market challenges, characterized by rising informality and persistent gender wage disparities. National labor informality reached 55.1 percent during the second quarter of 2026, with 33.1 million people working in informal roles.

In the State of Mexico, formal employment has seen a continuous decline. Between May and August, the region lost more than 35,000 formal positions registered with the IMSS. The Unión Industrial del Estado de México attributed this trend to rising labor costs and recent reforms, though structural issues like low productivity and economic growth also play roles.

Additionally, an analysis by the Mexican Institute for Competitiveness (IMCO) highlights a persistent gender wage gap. While the gap narrowed from 20 percent in 2005 to 14 percent in 2025, women still earn approximately 86 pesos for every 100 pesos earned by men. This disparity widens significantly in higher-responsibility roles, reaching 26 percent in operational supervision positions.