33.1 million jobs needed in Mexico – INEGI

Once the health emergency is over, Mexico will have to generate that number of places, three times the number needed in March

MEXICO CITY (INEGI) – The entrance to the new normality should be accompanied by the creation of 33.1 million jobs, according to Inegi data.

This figure almost tripled the employment needs that existed in March. It is composed of 2.1 million people who are actively looking for a job but cannot find one. 20 million who are not looking for one, but are willing to work if offered one, and 11 million who are working, but report needing to work more hours.

The above forms the labor gap, an indicator endorsed by the ILO to measure a country’s real employment needs. With this, 50.6% of the potential workforce in Mexico reported, derived from the pandemic, require a job, which meant a jump of 30.6 percentage points compared to 20.0% observed in March.

The positions required shot up from 12.7 to 33.1 million between March and April
The country needs to generate 33.1 million jobs during the new normality after the health emergency caused by covid-19, reported the Telephone Survey of Occupation and Employment of the National Institute of Statistics and Geography (INEGI).

This figure from April of this year implies that almost triple the employment needed in March -12.7 million-, it is made up of 2.1 million people who are actively looking for a job but cannot find one (open unemployment). 20.0 million people who are not looking for a job but are willing to work if offered one (hidden unemployment or available inactive). 5.9 million people who work but report needing to work more hours (underemployed).

This group of people makes up what is known as the “labor gap,” an indicator that has been endorsed by the International Labor Organization to measure a country’s real employment needs, and which goes beyond simple open unemployment.

With this, half (50.6%) of the potential labor force in Mexico reported, derived from the coronavirus pandemic, that there was a need for a job, which meant a jump of 30.6 percentage points compared to 20.0% observed during March.

Extended unemployment
An alternative indicator and one that is a subset of the labor gap is extended unemployment. It counts only those who do not have a job, that is, it counts only the open and hidden unemployed, thus excluding the underemployed.

If this indicator is considered, expanded unemployment in the country would reach 22.1 million people in April, which would imply a rate of 33.8 percent of the potential labor force.

This level of expanded unemployment is triple the 7.6 million people in March, which implied a rate of 12 percent.

The increase in extended unemployment is due to the sharp rise in the inactive population available for work. Most of the 12.5 million people who lost their jobs in April because of covid-19 were in this population, as they did not make efforts to look for work.

According to analysts, this may be due to the fact that they considered that they had low options to obtain a new job during the pandemic, or they are waiting for the arrival of the new normality to imply the reopening of the companies in which they worked. They may be considered again to work.

This indicator’s importance lies in the fact that several countries measure their official unemployment rate through the expanded rate. That is, the consideration of hidden unemployed (inactive persons available for work) since they do not have a job and are not looking for one because they are discouraged, but would be willing to work if offered a job.

Historically, the available inactive or unemployed hidden in Mexico have been 6 million people, three times the open unemployed, which on average, are two million people each year.

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