Mexico ranks fourth in OECD for real wage growth since 2021

Mexico has achieved the fourth-highest real wage growth among OECD countries since the beginning of 2021, primarily driven by consistent increases in the minimum wage. Between early 2021 and the first quarter of 2026, real wages in Mexico surged by 15.1%, a figure that significantly outpaces the OECD average of 4.9% and its median of 1.2%.

This upward trend in purchasing power has been sustained, with a 3.9% progression in Mexico during the past year alone, compared to the OECD's 1.7%. A key factor is the 68% increase in the real minimum wage since January 2021. By 2024, the minimum wage represented 73.7% of the median wage, indicating a substantial improvement in the lower end of the income scale.

Mexico's economic performance extends to productivity, which has grown solidly since the COVID-19 crisis. Labor productivity increased at an average annual rate of 1.45% from 2019 to 2023, and accelerated to 1.96% between 2023 and 2024. This growth occurred alongside a decrease in average hours worked, which fell by 0.21% annually from 2019 to 2023 and by 0.52% from 2023 to 2025. Despite this reduction, the total number of hours worked in Mexico remains high compared to other OECD nations.

The OECD report also notes Mexico's low unemployment rate of 2.7% in May 2026, the second lowest in the organization. However, informal employment continues to represent over half of the total workforce. The report highlights that employment protection regulations for formal workers are relatively strict and have become even more so for temporary contracts, with Mexico ranking third in the OECD for regulatory restrictions on temporary contracts.