Mexico raises minimum wage by 3.9% for 2013

MEXICO CITY–Mexico’s minimum wage commission agreed to grant a 3.9% increase in the minimum wage beginning in 2013, below the 4.2% hike granted a year before and less than the current rate of inflation.

The commission, which includes representatives of government, business and labor unions, said the increase of 3.9% brings to just under 65 pesos ($5.10) a day the minimum wage in the highest-paid Zone A, which includes the capital and major cities.

The minimum wage has for years been well below market wages, and more than anything serves as a benchmark for other wage negotiations during the year.

In a report last week on the informal labor market, the National Statistics Institute, or Inegi, said that median wages among informal workers–those who work in unregistered businesses, in home-based activities, or without formal contracts such as agricultural workers–are around MXN18 an hour, compared with MXN26 an hour in formal jobs.

Inegi researcher Rodrigo Negrete said that the number of workers who earn the minimum wage is diminishing and that even domestic workers are unlikely to work for that amount.

“Fewer and fewer workers earn the minimum wage,” he said. “That doesn’t mean that they’re well off, it just means that the minimum wage has gotten so far behind that it’s out of the labor market.”

Labor Ministry data show average wage settlements in the first 11 months of 2012 were 4.4%, compared with 4.3% in all of 2011. Annual inflation measured by the consumer price index was 4.2% at the end of November.