Mexico’s minimum wage: Stingy by any measure

08/16/14 The Economist

piggy bank with coinsBASILIO GONZÁLEZ is an unusually well-paid Mexican public servant. The 70-year-old’s total pay this year will be 2.8m pesos ($213,000). That is ironic, considering that for 23 years he has been president of the National Minimum Salary Commission. During that time the minimum wage has dropped by 43% after accounting for inflation, according to the Economic Commission for Latin America and the Caribbean (ECLAC), a part of the United Nations. It varies by region but currently averages 66 pesos a day. At that rate, a recipient would have to work every day for 116 years to earn what Mr González will make this year.

Does Mr González deserve his generous haul? Judging by the length of his tenure, Mexican authorities appear to think so. Even before he took office, wage suppression had been an essential part of Mexico’s successful anti-inflation drive. Since 1991, annual inflation has fallen from more than 22% to less than 4%.

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One thought on “Mexico’s minimum wage: Stingy by any measure

  1. Overall good article. However, those making one minimium wage (or 2 or 3) aren’t at that level because of cheating employers. Sixty percent of working Mexicans work in the so-called “informal economy”, for cash, so no “rules” apply.

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