In a significant legislative move, senators have unanimously approved constitutional reforms ensuring that minimum wages in Mexico are not set below the inflation rate. On October 9, 2024, the Senate gave the green light, with 124 votes in favor, to amend Article 123, sections A and B of the Mexican Constitution. This adjustment mandates that the annual setting or revision of both general and professional minimum wages must meet or exceed the inflation rate observed during the relevant period.
This constitutional change received backing from all parliamentary groups in the Senate. However, it met with criticism from opposition parties, who argued that while wages were being increased, there was a reduction in social programs. Marko Antonio Cortés Mendoza of the National Action Party (PAN) criticized the move, stating, “This remains nothing but a spectacle, as they give to the people with one hand and take away with two, like removing the Popular Health Insurance.”
Further clarity was sought by PAN legislator Ricardo Anaya Cortés, who asked whether this reform applied solely to federal police officers or also to state and municipal ones, as current law stipulated that their salaries should not be below the rates registered by the Mexican Social Security Institute (IMSS).
Earlier, on September 24, 2024, the Chamber of Deputies had also approved these reforms. A significant majority endorsed the changes to Article 123, ensuring that wages for key professions, such as teachers, police, and healthcare workers, are not below the IMSS-registered average.
The new salary reference for these roles is set at 16,777 pesos, 78 centavos, reflecting the average monthly salary recorded in 2023, adjusted for 2024 inflation. This figure will be updated annually based on inflation rates.
The proposal originated from the President’s office, aiming to improve living conditions for Mexican workers. Pedro Miguel Haces Barba of the Morena party highlighted that the reform is a critical step towards dignifying wages and boosting investment attractiveness.
Despite some reservations raised by various legislative groups, no changes were made to the reform proposal during the discussion phase.
**Secondary Article**
**Mexico’s Economic Outlook: Inflation Rates and Minimum Wage Legislation**
As Mexico navigates this historic wage reform, it is essential to consider the broader economic context. According to recent reports, Mexico’s inflation rate has been gradually declining, with a decrease for two consecutive months, reaching an annual rate of 4.58% in September 2024. This marked drop suggests that the inflation-adjusted minimum wage policy could significantly boost purchasing power for many Mexican workers.
This legislation is part of a broader government strategy to address economic disparities and improve living standards across the nation. Economists suggest that while this reform could enhance domestic spending and investment in human capital, it will require careful fiscal management to avoid unintended inflationary pressures.
The alignment of wage increments with inflation rates is expected to maintain economic stability, ensuring that workers can meet their essential needs without diminishing returns due to rising costs of living. As Mexico continues to position itself as a desirable destination for international investment, these structural economic reforms are crucial in fostering a more equitable and robust economic landscape.