### Impact of Minimum Wage Increase on Small and Medium Enterprises
The recent government’s decision to increase the minimum wage by 12%, effective January 1, 2025, is anticipated to have significant consequences for micro, small, and medium-sized enterprises (MSMEs) in the northern border region. The new daily minimum wage will rise from 373.89 pesos to 419.88 pesos. Ismael Plascencia López, an economist specializing in regional development, voiced concerns regarding the challenges facing less productive businesses that may struggle to absorb higher labor costs.
Plascencia noted that while larger manufacturers involved in international markets might endure the wage hike, smaller local businesses would face difficulties. “An imposed wage increase creates hurdles for these enterprises, leading to a rise in operating costs and discouraging hiring,” he explained. As a result, many unemployed workers may turn to the informal economy in search of opportunities.
While Plascencia agrees that wage increases can benefit the workforce, he emphasized the importance of aligning salary boosts with productivity gains across sectors. He warned that a mere wage raise without a corresponding productivity enhancement of 15% to 20% could undermine economic stability.
### December Sales Boost Anticipated
Despite the looming challenges, small businesses are optimistic about a potential 30% increase in sales during December, driven by the holiday season.
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### Secondary Article: Economic Strain and Strategic Responses in Tijuana
#### Construction Industry Adapts to Workforce Shortages
Faced with labor shortages, Tijuana’s construction industry is considering employing individuals experiencing homelessness. This unconventional approach aims to fill gaps caused by the growing demand for labor.
#### Efforts to Bolster SMEs and Combat Informality
In response to economic pressures, Tijuana’s private sector is exploring credit solutions for small and medium enterprises to combat informality. This move is expected to provide financial relief and encourage legitimate business operations.
#### Budget Cuts Pose Challenges for 2025
The upcoming year presents obstacles due to anticipated federal budget cuts. Local stakeholders express concern over how these financial reductions might impact economic growth, security, and healthcare services.
#### Impact of Border Policies on Tijuana’s Hospitality Sector
New border crossing regulations from the United States have reportedly led to decreased tourist flow from Southern California, affecting Tijuana’s hospitality industry. Restaurant owners anticipate lower revenues during the holiday season.
These developments highlight the complex economic landscape facing Tijuana, prompting industries and local authorities to adapt and seek innovative solutions for sustained growth and stability.