Mexico’s Manufacturing Sector Faces Labor Shortages

Employment in the industry has decreased by 0.1% month-over-month and 1% year-over-year, marking 42 consecutive months of decline, according to the National Institute of Statistics and Geography (Inegi).

Meanwhile, the labor market slowdown comes amid a rebound in sectoral production, which rose 1.7% month-over-month and 4.1% compared with August 2025. The latter represents the largest year-over-year increase since June 2023.

This trend persists in the manufacturing sector, where employment declined by 2% through August, while physical production volume showed a slight recovery, increasing by 0.9%, according to data from the Monthly Manufacturing Industry Survey (EMIM).

The outlook remains bleak for most manufacturing subsectors, both in terms of employment and overall output. However, a few exceptions stand out amid the broader downturn.

On a monthly basis, employment declined in 14 of the 21 industry classifications covered by the EMIM. The declines are listed from largest to smallest.

Among these categories, employment in the manufacturing of computers, communications and measuring equipment, as well as other electronic equipment, components and accessories, declined by 0.1%. This marked the first monthly decrease in this category in 2026.

Only three sectors recorded positive employment growth in 2026 through August. Computer equipment manufacturing led the way, with employment rising by 3.6%. The manufacture of petroleum and coal products and the beverage and tobacco industry also posted gains, both increasing by 0.1%.