The Long Road to a Decent Standard of Living for Mexican Workers: An Analysis of the Minimum Wage

In Mexico, there is still room for the administration to increase the minimum wage for workers, according to Eduardo Osuna Osuna, vice president and general director of BBVA Mexico. He stated that the increases decreed throughout the six-year term have improved the purchasing power of families and have had no impact on inflation levels.

In recent years, the minimum wage in Mexico has grown by 110 percent in nominal terms, with no one with a formal job earning less than 248.93 pesos per day or 7,468 pesos per month this year. Despite this progress, Mexico’s minimum wage is still one of the lowest in Latin America and is about 30 percent below its peak in the 1970s.

Osuna highlighted that further increasing the minimum wage for workers with formal incomes could improve their purchasing capacity and contribute to economic dynamism. However, he also noted that there may be an opportunity to make more targeted adjustments to specific industries or regions where labor costs are particularly high.

BBVA Mexico reported profits of 25,499 million pesos in the first three months of the year, a decrease of 0.9 percent compared to the same period last year. The decrease in profits was attributed to the creation of greater reserves to reduce credit risks, especially related to loans for families. Despite this setback, BBVA Mexico still contributes significantly to parent company’s profits globally, accounting for over half (56.5%) of total earnings worldwide.

Osuna expressed optimism that as economic conditions stabilize and inflation pressures subside, comparative effects leading to a decrease in profits will ease up soon and allow BBVA Mexico’s profit generation numbers return to positive territory.

Overall, while there have been some progress made towards improving wages for Mexican workers over recent years, there is still much work to be done if we want them to achieve a decent standard of living and contribute effectively towards economic growth in our country.