OCDE - OECD Employment Outlook 2026 Mexico

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OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

These country notes provide an overview of the labour market situation in each country based on data from OECD Employment Outlook 2026. This edition has a special focus on geographic disparities in jobs and incomes. Labour markets remain resilient but show further signs of weakening The OECD labour market remains resilient, with employment and labour force participation rates at record highs (72.1 and 76.7% in Q1 2026 on average across countries, respectively) and unemployment low by historical standards (4.9% in May 2026). However, there are increasing signs of weakening, including rising unemployment in many countries, slowing employment growth, and easing labour shortages. Due to the new surge in energy prices, real wages are expected to fall in many countries. • In Mexico, the unemployment rate stood at 2.7% i n May 2026, broadly stable compared with the previous two years and the second lowest among OECD countries, after Japan. Labour force participation has also remained at stable levels, at 65.1% in Q1 2026, compared with 65.4% in Q1 2025, but continues to fall short of the OECD average. Women’s participation slightly increased, from 51.2% to 51.3%, while men’s participation declined from 81.3% to 80.6%, leading to a modest narrowing of the gender participation gap. Despite these developments, informality conti nues to account for more than half of total employment. • Labour productivity growth in Mexico has been relatively strong since the onset of the COVID-19 crisis, standing out among OECD countries. Most recently, labour productivity increased by 1.96% over 2023-2024, compared with 0.62% on average across the OECD, marking an acceleration from the (2019-2023) where average growth was 1.45%. The recent productivity gains in Mexico have taken place alongside a reduction in working hours, as average hours work ed fell by 0.21%

from the (2019-2023) where average growth was 1.45%. The recent productivity gains in Mexico have taken place alongside a reduction in working hours, as average hours work ed fell by 0.21% per year between 2019 and 2023, and by 0.52% per year between 2023 and 2025. This d ecline has been steeper than the OECD average, where hours worked fell by 0.20% per year between 2023 and 2025, although hours worked remain high by OECD standards. • Real wages in Mexico have continued to grow strongly. By Q1 2026, real wages were 15.1% higher than in Q1 2021, far above the OECD average increase of 1.2%. Real wage growth also remained robust over the past year, with a yearon-year increase of 3.9%, compared with 1.7% across the OECD. Minimum wages have played an important role in this trend. Mexico recorded one of the strongest increases in real minimum wages across the OECD, rising by 8.2% y ear-on-year i n April 2026, compared with an OECD average of 2.7%. Since January 2021, the nominal minimum wage has more than doubled, increasing by 122.3%, while the real minimum wage rose by 68.0%. This dramatic rise in the minimum wage relative to median wages has tra nslated into by far the largest increase in the Kaitz index across the OECD , with the minimum wage reaching 73.7% of the median wage in 2024. Mexico2 

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

Real wage growth is slowing down while real wages remain below Q1 2021 levels in one-third of OECD countries Change in real hourly wages, Q1 2026 or latest

Note: “OECD” is the median of 37 OECD countries (not including Colombia).

Real wage growth is slowing down while real wages remain below Q1 2021 levels in one-third of OECD countries Change in real hourly wages, Q1 2026 or latest

Note: “OECD” is the median of 37 OECD countries (not including Colombia).

Source: Chapter 1 in OECD Employment Outlook 2026: Geographic Disparities in Jobs and Incomes, https://doi.org/10.1787/7e710f54-en.

Non-compete clauses are widespread beyond high-skill occupations Non-compete clauses – contract terms that prevent workers from moving to a competitor or starting a competing business – and related contractual restrictions are widespread across OECD labour markets. they covered about 30% of workers in 2025 , and are increasingly used beyond highly specialised jobs. While firms may use such clauses to protect trade secrets or investments, evidence sugg ests they can reduce job mobility, weaken wage growth, slow knowledge diffusion and undermine productivity growth. • Although non-compete clauses are unconstitutional in Mexico, employer survey evidence suggests that they remain common in practice. According to employers, between 23% and 39% of private-sector employees in Mexico are currently bound by a non-compete agreeme nt, compared with an average of around 20% to 30% across surveyed OECD countries. Firms in Mexico also report an upward trend in their use, pointing to a growing reliance on contractual restrictions that may limit workers’ ability to move between jobs or start competing businesses. • As in several other OECD countries, non-compete clauses in Mexico extend well beyond highskilled occupations, raising concerns about their justification. Between 10% and 28% of workers without access to confidential information, and between 20% and 37% of low-paid workers, report being subject to such agreements. In addition, around 54% of firms report knowledge of nopoaching or wage-fixing practices in their industry, above the cross-country average of 48%. 3

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

Share of employees bound by non-compete clauses as reported by employers

poaching or wage-fixing practices in their industry, above the cross-country average of 48%. 3

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

Share of employees bound by non-compete clauses as reported by employers

Source: Chapter 5 in OECD Employment Outlook 2026: Geographic Disparities in Jobs and Incomes, https://doi.org/10.1787/7e710f54-en.

Tailored employment protection helps labour markets adapt Employment protection legislation shapes job security, labour market dualism and firms’ ability to adjust to economic fluctuations and structural change. Updated OECD indicators show large c ross-country differences in dismissal regulations and notably restrictions on temporary contracts. • Employment protection legislation in Mexico is relatively strict for regular workers and has become stricter for temporary contracts in recent years. According to the OECD’s updated Emp loyment Protection Legislation indicators, Mexico has an EPL score of 2.46 for dismissals of regular workers, including individual and collective dismissals, placing it as the 12th strictest country in the OECD. The relatively high score reflects in particular the regulation and enforcem ent of unfair dismissal provisions, as well as, stricter procedural requirements for collective dismissals. • Regulatory restrictions on temporary contracts have increased recently, with the indicator rising from 1.6 in 2019 to 2.9 in 2025. Currently, Mexico has the third-highest level of regulatory restrictions on temporary contracts in the OECD, after Türkiye and Spain. This ti ghtening mainly reflects recent reforms aimed at addressing the misuse of temporary and subcontracted employment, notably the ban on temporary work agency employment introduced in April 2023 . This reform is expected to reduce labour market dualism by limiting the use of temporary arrangements.4 

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

Recent reforms in employment protection legislation Strictness of regulation of temporary contracts

Note: Range of indicator scores: 0-6 from least to most restrictive.

arrangements.4 

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

Recent reforms in employment protection legislation Strictness of regulation of temporary contracts

Note: Range of indicator scores: 0-6 from least to most restrictive.

Source: Chapter 6 in OECD Employment Outlook 2026: Geographic Disparities in Jobs and Incomes,

https://doi.org/10.1787/7e710f54-en. Contact Valentina CONTRERAS ( valentina.contreras@oecd.org) Stéphane CARCILLO ( stephane.carcillo@oecd.org) 5

OECD EMPLOYMENT OUTLOOK 2026: MEXICO © OECD 2026

This work is issued under the responsibility of the SecretaryGeneral of the OECD, and does not necessarily reflect the official views of OECD Member countries. This document, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law. Note by the Republic of Türkiye The information in this document with reference to “Cyprus” relate s to the southern part of the Island. There is no single authority representing both Turkish and Greek Cypriot people on the Island. Türkiye recognises the Turkish Republic of Northern Cyprus (TRNC). Until a lasting and equitable so lution is found within the context of the United Nations, Türkiye shall preserve its position concerning the “Cyprus issue”. Note by all the European Union Member States of the OECD and the European Union The Republic of Cyprus is recognised by all members of th e United Nations with the exception of Türkiye.

Nations, Türkiye shall preserve its position concerning the “Cyprus issue”. Note by all the European Union Member States of the OECD and the European Union The Republic of Cyprus is recognised by all members of th e United Nations with the exception of Türkiye. The information in this document relates to the area under the effective control of the Government of the Republic of Cyprus.

The full book is available in English: OECD (2026), OECD Employment Outlook 2026: Geographic Disparities in Jobs and Incomes, OECD Publishing, Paris, https://doi.org/10.1787/7e710f54-en.

© OECD 2026

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