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Latin America Investment News on Viva Tropical

Mexico Fails on Job Creation

Article Summary:

Informal employment is endemic in Mexico and the country has a deficit of 2 million jobs. With a growth of 500,000 job openings in 2011, the country has received a failing grade in employment growth.

Photo Credit: CNN Expansion

Original Article Text From CNN Expansion via Google Translate :

Mexico ‘fails’ on job creation

Mexico has the challenge of generating jobs for more than 1 million people, mainly young people, referred to data from the Ministry of Labour and Social Welfare. The scenario, however, is not entirely positive for the authorities, since the presidency of Felipe Calderón closed with a deficit of over 2 ½ million jobs , warned the director of the Center for Research in Economics and Business at Monterrey Tech Jose Luis de la Cruz.

Although employers forecast for this year to create more jobs, according to the Global Economy 2012 report of the international consulting firm Grant Thornton, Mexico faces a stage in which the programs of employment public does not solve the problem of precarious market, says the Center for Private Sector Economic Studies (CEESP).

“The six-year period (Calderon) has a very encouraging result, the employment created is of low quality. It takes the famous million jobs every year, but has fallen short by more than half a million annually. Working conditions in general, are bad, for example, many employers are no longer written contract, “says de la Cruz.

Figures from the Mexican Social Security Institute (IMSS) indicate that in 2011 made their formal jobs 591.000, entitled to employment benefits, but that does not mean a living wage. No occupation, but in the labor market has a tendency to enter poverty.

The academic Tec states that employment is no longer sufficient to safeguard the economic environment, or to generate higher levels of welfare, “today you have to work four days to have a salary to the value of what was the salary in the years 70 “.

In the past 10 years in terms of minimum wage “has fallen into a hole and there is no recovery,” says De la Cruz, who estimates that the purchasing power has declined over 20% in the last five years. When comparing revenues with costs of basic goods, he says, shows that property prices have increased in greater proportion to what is perceived in terms of salary.

“Wages are shrinking because they are applied as part of measures to control inflation, and should be a variable that generates wellness. At invalidated its target range is lost.” Use the income for these purposes, says Jose Luis de la Cruz, is a measure that was taken from the 80′s, and gained strength during the 90, since then, said: “There is no alternative economic strategies more productive.”

He also authored the report “A minimum agenda for Mexico ” aims to have policies that promote wage increases linked to increased business productivity.

Cross explains that in the country this type of questions “are not labordando”. Believes that the measures currently indicate that the worker is who increase wealth generation. However, “there is no commitment of companies to do more and better transfer (of resources).”

The CEESP warns that it is important to create an environment in which organizations are attracted to channel more resources. The commitment, mentioned the academic, starts with the government. “Companies can deliver more if they were in a better fiscal position, if taxes will be charged a simpler form.”

To change job insecurity, De la Cruz says that the government needs more austerity, require fewer resources in the economic system. “Otherwise it will be very difficult for the economy forward.” This measure is essential, she says, but what prevails among the authorities is a lack of ability to solve problems is a lack of planning and agreements between the private sector, government and universities.

“It takes leadership and will, that has not been given, is a problem that is growing and we must fix it because you need development opportunities, scholarship schemes, among other things,” says Jose Luis de la Cruz.

According to the document “A minimum agenda for Mexico,” unemployed youth is a latent problem. Around 7.8 million people between 12 and 25 do not study or work and belong to the group called “Ninis”. In addition, between 2010 and 2012 about 2.5 million people fall into poverty due to low-paid jobs and the economic conditions of the country, De la Cruz stressed.

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From CNN Expansion

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