Industry operates with outsourcing

Note published in Reforma, Negocios [Business] Section by Frida Andrade and Verónica Gascón.
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Note published in El Norte, Negocios [Business] Section by Frida Andrade and Verónica Gascón.
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Note published in Mural, Negocios [Business] Section by Frida Andrade and Verónica Gascón.
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Around 50 percent of the manufacturing industry in Mexico operates using the outsourcing scheme with a minimum of 40 percent in the case of the automotive sector, according to the Catch Consulting Firm.

The bill proposed by President Andrés Manuel López Obrador to eliminate subcontracting or outsourcing, as it is known, will increase labor costs for all of these companies in an instant.

This includes the elimination of insourcing, which is the creation of a company within the same group, to which the workforce is transferred.

Specialists point out that this will put the Country at a disadvantage, because companies have resorted to subcontracting due to the high costs for the generation of employment, such as social security and profit sharing.

Rodrigo Arciniegas, director of Catch Consulting, said that in the automotive-auto-parts sector, approximately 40 percent of the companies operate using subcontracting.

According to the Inegi [National Institute of Statistics and Geography], up until the month of August, 812 thousand and 84 people worked in the auto-parts industry and another 99 thousand 571 persons worked in the automotive industry.

Companies using outsourcing in a legal manner save on items such as dispersion or processing of the payroll and even in the calculation of taxes, explained Gilberto Martínez, of the Labor Lawyers Association of Baja California.

Although the initiative imposes a limit on bad practices in subcontracting, the elimination of insourcing would mean that companies must pay their employees 10 percent of their profits for the concept of profit sharing (PTU).

“With this reform the addition of 10 percent to the cost of doing business in the Country is not being taken into account; perhaps it is the right thing to do, but it is not the right time to do it”, said Óscar de la Vega, of the De la Vega & Martínez Rojas Firm.

Jorge Sales, of the Sales Boyoli Firm, stated that the topic of profit sharing must be included in the discussion, as it is a legitimate benefit, but the way in which it is calculated is obsolete.

“It is paid based on two criteria: the worker’s salary and the time that he has been employed.

“We believe that this formula is obsolete, in our opinion, a way to discourage outsourcing would be to change the way in which the PTU is calculated. That a kind of tabulator be created based on the productivity of each category of work”, he proposed.

Lawyer Ricardo Martínez believes that the disappearance of insourcing is very serious, and he said that it places the Country at a disadvantage due to the labor and social security costs involved in producing in Mexico.

“(The 10 percent of profit sharing) was established 35 years ago, when inflation was of 70 percent; today, our main trade partner lowered its corporate rate from 30 percent to 20 percent”, he said.

* Jobs in trouble

Manufacturing, tourism and other services which are the main sectors that use the scheme and will have to face a radical change in the labor relationship.


2003 1,002,697
2008 2,342,303
2013 3,018,127
2018 4,600,000

Source: STPS [Department of Labor and Social Welfare]