The trend in working poverty in the country; one still suffers to acquire the basics

The index of the poverty labor trend It is an indicator published quarterly by the National Council for the Evaluation of Social Development Policy (Coneval) to determine the percentage of the population with labor income below the value of a food basket; That is, those people who work and whose income, even if they were allocated 100%, would not be enough to acquire the basics to survive.

This index shows a trend of progressive improvement since 2020, when in the face of the health emergency and the economic crisis that was generated in parallel, in fact reaching a level lower than that recorded in the first quarter of that year, and which was, until that moment, the lowest indicator of the current administration.

Indeed, Coneval data show that, in the fourth quarter of 2018, 40.7% of the employed population had labor income below the value of the food basket. The percentage gradually decreased until it reached 36.6%, that is, one in every three employed people, increasing to 46% in the third quarter of 2020, in the midst of the Covid-19 pandemic crisis.

From that moment on, the indicator has gradually decreased until reaching 35.8%, an indicator that has a statistically significant difference compared to the first quarter of 2023, when it stood at 37.7%. In that sense, for the first time, after three years, there was a percentage of the population in working poverty lower than what had been achieved prior to the pandemic.

INCOME AND JOBS

Coneval shows that people’s labor income has had a substantial improvement, as it went, as an average per capita in the first quarter of 2023, from three thousand 58.6 pesos per month, to three thousand 277.58 pesos per month in the first quarter of 2024. This represents a real increase of 7.2%. In this way, Coneval points out that “the real per capita income in the urban area registered an annual increase of 7.6%, going from three thousand 449.64 to three thousand 710.79 per month, which is equivalent to around 261.15 pesos more. In rural areas, the increase was smaller, 5.4%, going from 1,827.88 pesos to 1,926.86 pesos per month, which represents approximately 98.98 pesos more.”

The decrease recorded in the value of the poverty labor trend index occurred in the urban area, since in the rural area the percentage of those who are employed and receive income below the value of the food basket was 49.6%, both in the first quarter of 2023 and in the first quarter of 2024, which is an important indicator of the lag that persists in the rural area and of everything that needs to be done in these territorial spaces.

INFORMALITY AND LOW INCOME

According to Coneval data, it can be said that working in the informal sector has severe consequences for those who have no other option. Indeed, the monthly income of those who have a formal job is, on average, 10,280 pesos; while for people who work informally, labor income is five thousand 52.33 pesos per month, that is, less than half of their counterparts.

On the other hand, Coneval estimates that real per capita income in the urban area registered an increase of 7.6% on an annualized basis.

FOR WHAT IT REACHES

According to Coneval, the real per capita labor income of people in Mexico amounts, at the end of March 2024, to 3,278 pesos per month, deflated with the value of the food basket, that is, the cost of daily food required. for survival. That means a daily sum of 109.2 pesos per person, per day. This is a harsh reality for millions of people, which is why, despite the progress made in recent years, there is still a long way to go to achieve decent wages throughout the country.

ONE THIRD IN WORKING POVERTY

The problems of the national economy, and particularly in terms of generating decent jobs, are structural. According to Coneval, practically one in three people who are employed in Mexico have incomes that are below the lowest subsistence thresholds, and every day they suffer, therefore, difficulties in acquiring the minimum essential to be alive. . To take the country to a new course of development, a profound restructuring of the world of work is needed, and this requires the postponed tax reform that has been urgently needed since the 1980s in the 20th century, in Mexico.

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