Labor Protection in Mexico

Abstract

If one looks for a representative emerging economy to examine the different effects of labor reforms, Mexico provides an important case study. In order to boost economic recovery, the government promoted infrastructure spending, transfers to development banks, support to small and medium-sized enterprises, and to the export sector. As usual labor-management relations are uneven in Mexico and union issues can be complex, to reduce the negative consequences related to the sharp increase of unemployment, the government tried to focus more on the generation of employment introducing several measures such as training and temporary jobs to facilitate the withdrawal of savings from the mandatory individual pension accounts, coverage of the medical insurance and maternity benefits for dismissed workers, among others. But, challenges such as the informal economy, minimum wage convenience, flexible labor contracts, entrepreneur vulnerability, and higher education labor market have to be faced.