1. MEXICO’S REPORT ON THE QUALITY ON EMPLOYMENT UNECE/ILO/EUROSTAT Seminar, October 14-16, 2009

2. Mexico’s Unemployment Rate Puzzle * Non-member economies. Source: OECD: Harmonised Unemployment Rate (HUR), July 2009. Quality of Employment it is not just a key issue in its own right; in Mexico perhaps more than any country in this seminar just to get or to hold a job does not mean that somebody “has make it”. Since its incorporation to OECD countries back in 1994, Mexico’ UR has been systematically lower than both the OECD total as well OECD Europe average and what has been observed during 2009 is not an exception on this regard.

3. Standard explanations on why Mexico’s UR has been comparatively low Huge migration flows to the U.S. (labor pressure transferred to the other side of the border). A large informal sector. A subsistence agriculture practices still prevalent (survival strategies either not in contact with labor markets or with no expectations about them) in dispersed rural areas. There is not national unemployment insurance so it is not possible to remain under that condition for a long time; individuals are pushed to accept any offer out there and to be quite less “picky” as they are in developed countries.

4. These explanations may hold in general but the context faced during 2009 suggests there must be more than that because…. Amongst OECD countries Mexico’s economy has been probably the most affected as a consequence of the current recession; during 2009 first half GDP drops 10%. Due the fact that the crises started in the US, migration flows have been at their lowest level ever. Brazil’s informal sector is also significant and despite the global recession its economy is going to register a growth during 2009, yet its UR in July was above the Mexican one.

5. However… Brazil has national unemployment insurance. This and the fact that there has been a typical real wages lag in Mexico since the eighties suggest that the labor markets of the latter adjust in a different way. A typical OECD country labor market is one with characteristic rigidities so most of the burden of adjustment is felt –so far- in the side of quantities (level of employment). In Mexico the side that bears most of the adjustment is the price of the labor force plus work conditions that is in terms of quality of employment. May be Mexico is a litmus case in order to understand the meaning of most of the indicators proposed and how they function.

6. An Analytical Typology Mexico country report consists on about 38 indicators, 30 of them corresponding to those explicitly described in the list contained in the document “INTRODUCTION OF THE CONCEPTUAL FRAMEWORK FOR MEASURING THE QUALITY OF EMPLOYMENT” Making a typology in terms of what this indicator said it is possible to establish six categories: I. Those amenable to analysis in terms of economic cycle II. Context dependent indicators: cannot be interpreted in a straightforward manner III. Those following their own inertia despite the context IV. Those over and above economic cycle analysis with an unmistakable meaning V. Those that may have an unmistakable meaning but in need of a more precise definitions VI. Those with an ambiguous meaning

7. Indicators amenable to analysis in terms of economic cycle 1. Safety and ethics of employment a) Fatal occupational injury rate b) Non fatal occupational injury rate 2. Income and benefits from employment a) Share of employees using paid annual leave b) Share of employees using sick leave 3. Working hours and balancing work and non-working life a) Share of employees receiving maternity/paternity/family leave benefits 4. Security of employment a) Percentage of employees 25 years of age and older by job tenure b) Share of economically active population contributing to a pension fund 5. Social dialogue and workplace relationships a) Share of employees covered by collective wage bargaining

8. Share of employees using non-wage pecuniary benefits, 2005 - 2009 Information for second quarters Year Share of employees with paid annual leave Share of employees with job that pays a sick leave 200555.3854.25 200655.0753.58 200756.3354.94 200855.3554.48 200954.6153.58 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE).

9. Context dependent interpretation of indicators 1. Safety and ethics of employment a) Share of employees working in “hazardous” conditions 2. Income and benefits from employment a) Average weekly earnings of employees b) Share of employees paid at below minimum wage 3. Working hours and balancing work and non-working life a) Share of employed persons working 49 hrs and more per week b) Share of employed persons working less than 30 hours per week involuntary

10. Context dependent indicators c) Share of employed working more than one job d) Average weekly (actual) hours e) Percentage of people who usually work at night/evening f) Percentage of employed people who usually work on weekend or bank holiday 4. Security of employment and social protection a) Percentage of employees 25 years of age and older with temporary jobs 5. Social Dialogue and workplace relationships a) Average number of days not worked due to strikes and lockouts

11. Share of employed persons working 49 hours or more per week, 2008 - 2009

12. Share of employed persons involuntary working less than 30 hours per week, 2008 - 2009

13. Days worker 1/ lost due to strikes and lockouts 2008 Annual1 123 583 Jan22 155 Feb481 921 Mar40 256 Apr72 May40 272 Jun158 Jul85 525 Aug190 500 Sep164 833 Oct0 Nov8 077 Dec89 814 2009 Annual298 976 Jan0 Feb205 415 Mar59 027 Apr26 866 May1 812 Jun5 856 Jul0

14. Indicators following their own inertia despite the economic context 2. Income and benefits from employment a) Low pay (Share of employed with below 2/3 of median hourly earnings) 3. Workings hours and balancing work and non-working life a) Ratio of employment rate for women with children under compulsory school age to the employment rate of all women aged 20-49 6. Skills development and life-long learning. a) Share of employed who have more education than is normally required in their occupation b) Share of employed who have less education than is normally required in their occupation

15. Share of employed below median hourly earnings Information for second quarters Year Total employment below 2/3 Total employment below 1/2 Salary workers below 2/3 Salary workers below 1/2 200521.5613.1020.369.95 200619.6311.3918.588.54 200720.2510.5219.247.67 200819.579.9618.567.15 200918.5610.4217.307.48 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE).

16. Skill development and life-long learning Second quarters Year Share of employed who have more education than is normally required in their occupation Share of employed who have less education than is normally required in their occupation 20059.982.91 20069.132.84 20079.742.79 20089.922.54 20099.612.51 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE).

17. Indicators over and above economic cycle analysis with an unmistakable meaning 1. Safety and ethics of employment a) Fatal occupational injury rate b) Non-fatal occupational injury rate c) Employment of persons who are below the minimum age specified for the kind of work performed d) Employment of persons who are below 18 years in designated hazardous industries and occupations e) Employment of persons below 18 years for hours exceeding a specific threshold f) Fair treatment in employment i. Salary Discrimination Index

18. Indicators over and above economic cycle analysis with an unmistakable meaning ii. Women in the labor force with kids and without couple iii. Men and women unemployment rates by age groups iv. Men and women informal sector employment rates by age groups v. Senior citizen population by activity condition 7. Workplace relationships and intrinsic nature of work a) Labor force who have quit a job because have been harassed at work in the last year b) Labor force who have quit a job because conflicts with a boss or superior c) Labor force who have quit a job because discrimination at work

19. Child labour below 18 years old Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE), Módulo de Trabajo Infantil, 2007.

20. Child labour below 18 years old 5 to 13 years old TOTAL1 113 480 Agriculture and husbandry workers416 981 Workers in manufacturing processes, helpers and assistants146 971 Employees in retail trade operating with premises261 956 Street vendors and other street jobs100 898 Domestic servants33 855 Preparation of food & beverages and other services152 819 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE), Módulo de Trabajo Infantil, 2007.

21. Salary discrimination index Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE). Salary discrimination index for second quarters 2005-0.11 2006-0.12 2007-0.13 2008-0.11 2009-0.13

22. Women in the labour force with kids and without couple 1/. Shares on respect total women with kids in each category

23. Men and women unemployment rates: comparisons by age groups

24. Men and women informal sector employment rates: comparisons by age groups

25. Senior citizen population by activity condition

26. Workplace relationships and intrinsic nature of work Labour force who have quit a job because have been harassed at work Labour force who have quit a job because conflicts with a boss or superior Labour force who have quit a job because discrimination at work TotalMenWomenTotalMenWomenTotalMenWomen I quarter 200637 55111 60225 949356 339253 300103 03970 35539 86630 489 I quarter 200938 79116 64522 146447 252303 740143 51273 54738 62334 924 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE), first quarters, 2006 and 2009.

27. Indicators that may have an unmistakable meaning but in need of a more precise definition 4. Security of employment and social protection a) Public Social security expenditure as share of GDP 6. Skills development and life-long learning b) Share of employed persons in high skilled occupations

28. Public social security expenditure as share of GDP 1994-2008 Source: Cuenta de la Hacienda Pública Federal: SHCP y Poder Legislativo Federal. Year Share of GDP Share of programmed public expenditure 19941.16.8 19951.17.8 19961.28.1 19971.510.0 19981.510.5 19991.913.4 20002.114.4 20012.013.8 20022.314.8 20031.911.8 20042.012.3 20051.911.6 20062.011.9 20072.212.5 20081.912.0

29. Indicators with an ambiguous meaning 4. Security of employment and social protection a) Percentage of employed who are unincorporated self-employed 5. Social dialogue and workplace relationships a) Average number of days not worked due to strikes and lockouts 6. Skills development and life-long learning a) Share of employed who have less education than is normally required in their occupation

30. Percentage of employed who are unincorporated self-employed Self employed 23.0 Source: INEGI, STPS, Encuesta Nacional de Ocupación y Empleo (ENOE), second quarter, 2009.

31. Priorities under Mexico’s perspective The indicators profile or properties in the proposal that seems to be more relevant for the Mexican experience are both those amenable to macro economic analysis besides those related with fairness and inequality. The first category encompasses eight indicators distributed in dimensions 1,2,3,4 and 5. They matter not because they say something more profound or detailed on how Mexican labor markets once under stress are adjusted but also because say something else on respect the performance of the of the well fare institutions, their limited scope, and the tensions due the financial conundrums they are immersed.

32. Priorities under Mexico’s perspective The second analytic category (indicators unmistakably linked with fairness and equity) encompass twelve more indicators concentrated in dimensions 1 and 7. They are also a priority because their self evident relevance plus international commitments in order to deal with these issues (such a child labor, gender perspective) and honor treatises on this regard. So both analytical categories adds without duplication 20 indicators covering all dimensions but the six one. This can amended if an indicator such as the share of employees who received job training is included; an issue that perfectly fits in either category despite there is not still available data on this regard in Mexico (it will be in the incoming months).

33. Priorities under Mexico’s perspective Those indicators tending to follow their own inertia or in need of more precise definitions would be priority two. Of those Mexico can produce 5 indicators are identified as such belonging to dimensions 2, 3, 4, and 6. Those indicators for which the interpretation seems to be heavily dependent on a given context wouldn’t be included because they can be misleading: for example in the midst of an economic crisis may suggest an improvement when it might not be the case. To this category ought to be added those other indicators which meaning could be controversial. Summing up: In the proposal we identify 20-24 indicators distributed all over the seven dimensions worth to focus on as the first stage in consolidating this effort. This is so beside any possibility that a multivariate statistical technique could reduce even further this set of indicators.

34. Suggestions on the initiative Concepts missed: Economic risk (Economic Exposure).- It my help to unified some indicators already there in the proposal with other concepts such as informal employment in its wide sense (as it is understood by the XVII ICLS, 2003) or in any case to pay more attention to independent workers as well pseudo independent workers. Indicators worth to be considered (a matter of emphasis)  Real wages ( i.e. minimum as well average)  Pensions (i.e. average pension proportion on respect poverty lines)  Senior citizens and labor force not far away of that condition (i.e. individuals 60 years old on willing to work but discouraged to intent job seeking)  Quality of services provided by social security (i.e. complaints on health care services guaranteed by a labor relationship). Gaps between the Jure and the Facto labor rights.

35. THANKS THOSE WHO REMAIN AWAKE!