Mexico lost a million tax-paying jobs over last three months

MEXICO CITY (Reuters) - Mexican job losses since March exceed 1 million as the economy shed nearly 350,000 formal jobs in May because of the coronavirus lockdown, though the pace of layoffs has slowed.

FILE PHOTO: People walk past a building undergoing construction in Mexico City, Mexico January 30, 2020. REUTERS/Andres Martinez Casares

Widespread confinement measures in place since late March have ravaged Latin America’s second-biggest economy, as it suffers through its deepest recession in decades.

In May, 344,526 jobs were lost, while employers cut 555,247 formal jobs in April, and another 130,593 in March, among workers registered with social security institute IMSS.

Formal jobs stem from contracts and include defined pay and tax obligations, while informal jobs mostly operate in cash and outside the law.

Slightly more than half of Mexico’s workforce is thought to be informal.

President Andres Manuel Lopez Obrador has played down the severity of the pandemic’s economic hit and previously predicted fewer than a million lost formal jobs.

The government announced a gradual economic reopening from June 1, allowing “essential” industries including carmaking and mining to resume operations, but surging deaths and infections have kept nearly the entire country in the highest phase of contagion alert, dampening expectations for major changes.

It is especially bad news for the 31 million Mexicans working in the informal sector.

“The crisis exacerbates inequity and the critical employment conditions for those who have the least,” said economist Jose Luis de la Cruz.

A survey conducted by national statistics agency INEGI revealed 12.5 million formal and informal jobs were lost in April alone.

Among them, 57-year-old Isidoro Camilo lost his job laying down tiles and says after two weeks of looking for work he has yet to get lucky.

“It’s affected all of us... I’ve been at it for 15 days but you have to keep fighting, looking. I haven’t found anything,” he said.

“We don’t even have enough to eat.”

Reporting by David Alire Garcia, Sharay Angulo and Alberto Fajardo; Additional reporting and writing by Anthony Esposito; Editing by Grant McCool and Cynthia Osterman