Mexico passes country-wide minimum wage increase
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Mexico passes country-wide minimum wage increase

Mexican officials announced this week that the country’s minimum wage will increase, going to up 70.10 pesos per day as of October 1. It is the first time in nearly a century that there has been a country-wide minimum wage; Mexico first established provisions for a minimum wage in the 1917 Constitution.

$4.12 a day

The increase, which means that minimum-wage workers across the country will earn the equivalent of about $4.12 a day or $123 a month, is being touted as an achievement by the administration of President Enrique Peña Nieto, who established a country-wide minimum wage as one of the objectives in his social development plan.

But not all public figures are celebrating the modest increase.

Falling short?

Mexico City mayor Miguel Mancera criticized the wage news, contending that the increase is so negligible as to be all but useless and saying there’s no way it will contribute to combating widespread poverty affecting many Mexicans.

Mancera has long advocated a wage increase to a goal of 171.3 pesos per day by the year 2018. –at least in the capital–that’s nearly two and a half times what was the national average wage of 67.3 pesos per day.

Ricardo Anaya, national leader of the PAN, one of Mexico’s major political parties, also said the new national minimum wage falls far short of the ideal wage. According to Anaya 70.10 pesos still keeps Mexicans below the poverty level and is more than five times less than what Chile and the Czech Republic pay their citizens as a minimum wage.  The wage increase means little, Anaya said, given that it fails to account for the increase in the cost of living.

In short, while a wage increase may offer some benefit to Mexico’s poorest, it fails to address true income inequality. According to The Organization for Economic Co-operation and Development, “the top 20% of (Mexico’s) population (earns) more than thirteen times as much as the bottom 20%,” and the average household income is just $13,085 a year.

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