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Wednesday, December 12, 2012

Using New Metric, INEGI Finds 60 Percent of Mexican Workers in Informal Economy

Aristegui Noticias

The agency reports that six out of ten Mexicans work in the informal sector. Inegi added unprotected field labor, paid domestic work, and subordinate employment to its definition of informality.
Photo: Enrique Ordóñez/Cuartoscuro
Six out of every ten workers in Mexico are employed informally: these 29.3 million Mexicans represent 60.1 percent of total employment in the country (48.7 million people), found the National Institute of Statistics and Geography (INEGI).

This indicates that 29.3 million people working in the informal economy do not have social security, says a new study on informal employment in Mexico that was presented on Tuesday by INEGI's president, Eduardo Sojo.

Under the new metric, informal unemployment, or the expanded measurement of informality, includes the following categories, in addition to those that INEGI had previously used: unprotected farm labor, paid domestic work, and subordinate employees who, although they work for established companies, do it in ways that circumvent the social security system.
"Now we are not just surveying small, poor entities, those that don't distinguish between household and business income... this goes further and looks at everyone who has been made vulnerable from operating outside the law that regulates their work," said Sojo.
Researcher Rodrigo Negrete said that out of the 29.3 million people in all forms of informal employment, 14.2 million exclusively work in the informal sector; 2.1 million in paid domestic service; 6.2 million in farm labor; and another 6.8 million in businesses, government and other institutions.

He said that the Informal Work Rate (TIL), or informal employment, rose from 59.3 to 60.1 percent from the first quarter of 2005 to the third quarter of 2012.

The states with the lowest rates of informal employment were Baja California Sur (41.6 percent), Chihuahua (42.8) and Nuevo León (43), while the highest rates were in Oaxaca (80.8 percent), Guerrero (80.8) and Chiapas (76.5).

In terms of income, a formally employed worker earned on average 38.4 pesos [$3] per hour, while an informally employed worker earned 8.24 pesos [$.65] per hour.

(With information from Inegi)