Mexico's record-low unemployment hides persistent precarious work and inequality

Mexico’s labour market shows mixed results in early 2026. While unemployment has hit a record low, precarious work and informality remain widespread. The gender pay gap has also grown, highlighting ongoing challenges for workers. Official figures from March 2026 placed Mexico’s unemployment rate at just 2.4%—the lowest among OECD nations. Despite this, over half of the workforce still operates in the informal sector, where jobs lack contracts or benefits. Informal employment has barely shifted since 2005, staying between 55% and 59% for two decades.

Recent reforms, such as higher minimum wages and mandatory paid leave, have done little to improve stability. The Critical Employment Conditions Rate (TCCO) reached 38.3% in early 2026, meaning nearly four in ten workers face precarious conditions. Women, in particular, experience greater instability, contributing to a widening gender pay gap. The data suggests that while more Mexicans are employed, job quality remains a persistent issue. Formal protections and decent wages still elude a significant portion of the workforce.

Mexico’s low unemployment masks deeper problems in its labour market. Informality and precarious work affect millions, despite policy efforts to strengthen rights. The gender pay gap’s expansion further underscores the uneven progress in improving working conditions.