Note published in El Economista, Empresas [Companies] section by María del Pilar Martínez.
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Labor productivity in the second quarter of the year showed that the workers that remained in their jobs produced more in fewer hours.
Labor productivity in the second quarter of the year showed that the workers that remained in their jobs produced more in fewer hours. “In many cases at more intense work paces and in processes that demand special understanding, skills, efforts and capabilities”, said the president of the National Commission on Minimum Wages (Conasami), Andrés Peñaloza Méndez.
After analyzing the data reported by the National Institute of Statistics and Geography (INEGI) on the Global Indicator of Labor Productivity of the Economy (IGPLE), the president of Conasami said that its increase to 11.4% in the April-June quarter of 2020, compared to the immediately preceding period, “does not necessarily mean that the country or the companies have improved their production processes, becoming more efficient.”
Peñaloza Méndez added that “this increase, from 9.8% to 11.4%, is due to a greater fall in the labor market than in the GDP; that is, productivity fell on the labor force that remained active during the critical months of the crisis”.
During the second quarter of the year, the Gross Domestic Product (GDP) contracted 17.1% in comparison to the previous quarter; at the same time, 12.5 million people left the labor market during April and June, representing a 26.4% drop in the Economically Active Population (EAP).
The head of the Conasami stated that “Mexico’s low growth is not due to productivity, but to the low level of both public and private investment, to which we must add an insufficient credit system, the shrinking of development banking, a monetary policy that tends to appreciate the real exchange rate and the absence of a strong policy for internal industrial clusters”.
Nevertheless, the analysis conducted by the president of the Conasami indicates that “the average wage and its annual growth have been maintained during the health emergency, to a large extent due to the arithmetical effect caused by the extensive elimination of low-wage jobs from March to June”.
Employment, in critical condition
Ignacio Román, professor and researcher at the ITESO (Western Institute of Technology and Higher Education), explained that “what can be gleaned from the labor productivity report can be somewhat bitter because on the one hand we have a larger number of the population that has no job and, on the other, we have those who have a job and have to work at more difficult paces and under more difficult conditions”.
He explained that “there is a reduction in the actual income of companies per worker; it would seem that these are contradictory figures, but what this tells us is that, most likely, the greatest decrease in employment comes from the informal economy”.
For her part, Blanya Cristina Correal, specialist in Human Resources at D&M, stated that recent reports on productivity are added to the elements that confirm that the world of employment will be transformed, and this will happen within the next six months, “there will be an impact in the short and in the long term and we will see that informality will increase, which is worrying because, in the same manner, the quality of employment in general will decrease, and so will social security”.
Correal maintained that there will be a greater flexibility in labor relationships, since “there is great deal of progress being made on this topic – in general in Latin America – where companies are beginning to question whether they need full-time employees or whether they should start working by shifts since they saw that, when fewer people were working longer hours, companies were able to measure who was producing and who was not”.