Mexico lost more formal sector jobs last month than in any July on record.
The Mexican Social Security Institute (IMSS) reported on Monday that the number of people in formal sector jobs declined by 19,550 in July compared to the previous month. On a month-over-month basis, the workforce shrank by 0.1%.
“This result reflects, among other factors, seasonality associated with the end of the school year and, in part, the declining phase of the agricultural cycle,” IMSS said in a statement.
However, data shows that the size of Mexico’s formal sector workforce usually increases in July.
In a period of almost three decades dating back to 1998 — when IMSS first kept comparable records — Mexico has lost formal sector jobs in July in just six years, while the workforce increased in the seventh month of 23 years.
So what was the real reason for the record job losses last month? The conclusion of the FIFA men’s World Cup, suggests a report by the news outlet Bloomberg Línea.
“After the final whistle of the 2026 World Cup, Mexico lost more formal jobs in July than had ever been recorded in official records,” Bloomberg Línea reported.
The loss of almost 20,000 formal sector jobs in July came after Mexico’s formal workforce grew by 61,023 positions in June, the month in which Mexico hosted 12 of its 13 World Cup matches. The final World Cup match in Mexico was the July 5 round of 16 clash between Mexico and England in Mexico City.
In addition to the creation of employment directly related to the World Cup, such as jobs in stadiums, the increase in June was attributed to growth in the size of the workforce of drivers for ridesharing companies such as Uber and Didi. Demand for ridesharing services increased during the World Cup, particularly in the Mexico City metropolitan area.
The launch of a program that provides employment benefits to digital platform workers has helped prop up Mexico’s formal sector job numbers since last year. According to an analysis by Manpower Group, a staffing company, Mexico would have lost 29,823 jobs in July if 10,273 digital platform workers hadn’t entered the formal workforce.
Alberto Alesi, Manpower Group’s general director in Mexico, said that companies are currently demonstrating a high degree of caution when it comes to hiring.
“Economic challenges are the primary factor driving caution and potential workforce reductions, and they will be decisive in determining the net increase in formal jobs by the end of 2026,” he said.
IMSS also reported on Monday that the number of formal sector employers declined on a month-over-month and annual basis in July. At the end of last month, 1.01 million employers were affiliated with IMSS, down 0.2% compared to June and 2.5% on an annual basis.
The month-over-month decline in July in the size of Mexico’s formal sector workforce and in the number of employers came after the Mexican economy, buoyed by World Cup spending, grew 1.5% on a sequential basis in the second quarter of 2026, according to preliminary data. The economy contracted 0.6% on a sequential basis in the first quarter of the year.
Mexico has added more than 243,000 formal sector jobs this year
IMSS data shows that 22.76 million people were in IMSS-affiliated formal sector jobs at the end of July.
The institute said that is the fourth-highest figure on record and the highest for any July.
IMSS said that 87% of formal sector workers are in permanent positions while the remaining 13% are in temporary jobs.
In the first seven months of 2026, Mexico’s formal sector workforce grew by 243,078 positions, according to IMSS. Over 95% of the new jobs are permanent positions, IMSS said. The increase in formal sector jobs in the first seven months of this year is 24.8% higher than in the same period of last year.
The total number of formal sector jobs increased on a month-over-month basis in February, March, April and June, and declined in January, May and July. The largest number of job losses in a single month this year occurred in May, when the formal sector workforce shrank by more than 29,000 positions.
In the 12 months to the end of July, Mexico added 326,987 formal sector jobs, representing annual growth of 1.5%.
While Mexico’s formal sector is growing, the majority of Mexican workers continue to toil in the country’s vast informal sector. In June, 55% of all Mexican workers were employed in the informal sector, according to the national statistics agency INEGI.
Baja California and Oaxaca lead Mexico for annual job growth
Among Mexico’s 32 federal entities, the northern state of Baja California recorded the highest annual formal sector job growth in July. That state’s formal sector workforce grew 7% in the 12 months to July 31.
Oaxaca recorded the second strongest annual growth. The southern state’s formal sector workforce grew 5.8% in the 12 months to the end of July.
Six other states recorded annual job growth above 3%. They were México state (3.8%); San Luis Potosí (3.6%); Tabasco (3.5%); Hidalgo (3.5%); Durango (3.5%); and Mexico City (3.3%).
All told, the formal sector workforces of 19 entities increased in the 12 months to the end of July, while 13 entities lost jobs in the period.
The largest contraction occurred in the Gulf coast state of Campeche, whose formal sector workforce decreased by 7.3% in the 12 months to the end of July. The next biggest contractions occurred in Tamaulipas (-2.5%); Quintana Roo (2.4%); and Morelos (2.4%). Among the other entities that lost formal sector jobs over the past year was the violence-plagued state of Sinaloa.
Transport and communications sector records strongest job growth
IMSS data also shows that the workforce in Mexico’s transport and communications sector increased by 7.5% in the 12 months to the end of July.
The mining sector recorded the second strongest annual job growth (+4.3%), followed by social services (+3.3%), electricity (+2.1%), services for companies (1.8%), commerce (+1.7%) and construction (+1.2%).
Meanwhile, the workforce of the transformation (manufacturing) sector shrank 0.7% in the 12 months to the end of July, while the number of people employed in the agriculture sector declined 5.6%.
Mexico’s average formal sector salary reaches a record high
IMSS reported that the average daily base salary for an IMSS-affiliated formal sector worker at the end of July was 673.9 pesos (US $39.40), an annual increase of 42.4 pesos or 6.7%.
IMSS said that the average formal sector salary in July was the highest on record.
With reports from Bloomberg Línea, EFE, Expansión and El Economista
