On Wednesday I commented to you on the difficulties of properly comparing the three Mexican labor markets: the formal, the informal, and the U.S. market. Precisely because of these statistical problems, Instituto Nacional de Estadística y Geografía developed a special account to measure the informal economy. In it, the Gross Domestic Product of informal activities is estimated, as well as the number of people working in them, including their compensation.
Unfortunately, that information does not match what is published by the National Occupation and Employment Survey, nor is it compatible with the full National Accounts. That is why I said on Wednesday that we do not have a clear idea of what Mexicans do for a living or how much they earn.
On the other hand, Jesús Cervantes has informed me of an error in what we discussed on Wednesday. The wage bill of Mexican workers in the United States, considering the 19 million workers, exceeds one trillion dollars (twelve zeros), so the average income in 2025 exceeds 91,000 pesos per month. In Mexico, those insured by the Instituto Mexicano del Seguro Social—who averaged 22.4 million last year—had an income of 19,000 pesos. One-fifth as much.
In the informal sector, following the INEGI product I mentioned, we would have 16 million people with some remuneration and 14 million without it. The latter may be family members helping in a business or, very importantly, in agriculture, which INEGI includes in informality in cases of subsistence production. Based on the compensation figures published there, those who receive something have an average monthly income of 10,000 pesos, a little more than half that of formal workers. It should be noted that INEGI’s latest data is for 2024—I am estimating 2025.
However, what is reported as “unpaid” would also include owners of informal businesses, landholders, and similar cases, so it may be better to estimate their income using gross value added. If I do so, for the 30.5 million Mexicans in informality, the average monthly income comes out to 17,000 pesos, already very close to the 19,000 pesos of formal workers.
Now comes the important point. Formality is defined by access to healthcare and social security. The cost of that service, for those working in the private sector who must be affiliated with IMSS, is equivalent to 25% of income. Practically five thousand pesos out of the nineteen thousand must go to IMSS, which is no longer really in charge of social security (that is handled by pension funds), and which is facing very serious problems in access to health services. Partly for historical reasons, but recently also because of the idea of burdening IMSS with the care of IMSS-Bienestar, which is not the same thing but still represents a strain on the institution.
Based on what we are seeing, being informal allows for higher income than being formal, once the cost of health services is deducted—services that are quite deficient anyway, and to which one can gain access if a family member is insured.
I close by drawing attention to the very different productivity across the three markets. A worker in the United States produces three to four times what is produced here, and if we add the difference in cost of living, their income should be six to eight times higher, yet it is only five times higher. Although the gap has been narrowing for various reasons, what has happened in recent years with excessive increases in the minimum wage is already entering dangerous territory. Meanwhile, a formal worker in Mexico produces twice as much as an informal one, but that difference in productivity is not reflected in different incomes, as we have seen.
Taken together, this is a mirage—and when it disappears, it will be painful.