Post-AMLO's rule, Mexican household incomes have risen, and there's a modest reduction in income disparity.
Mexico has witnessed a notable increase in household income over the past eight years, according to the National Survey of Household Income and Expenditure (ENIGH) 2024, published by the National Institute of Statistics and Geography (INEGI) in July 2024. From 2016 to 2024, the average quarterly income reached approximately 77,864 pesos, marking a growth of about 10.6% compared to the 2020-2022 period.
This income growth can be attributed to several key factors. The Mexican government raised the minimum wage multiple times during this period, directly boosting the income of low-wage workers and contributing to overall household income growth. The expansion of formal employment jobs, which provide more stable income and social benefits compared to informal work, also played a critical role. By 2023, around 68.65% of Mexico’s employed population had paid employment contracts with rights to remuneration, indicating a trend toward formalization in the labor market.
Government social programs aimed at supporting vulnerable households further supported income growth, especially for lower-income deciles. Households in income deciles II and III experienced the most considerable income increases between 2022 and 2024, suggesting that lower-middle-income groups benefitted significantly during this period.
However, income inequality has diminished but still remains significant. The poorest 10% of households saw a substantial income increase since 2016 - over 35%. On the other hand, earners in the top 10% saw their income drop by 8%. In 2024, the lowest-income households reported an average quarterly income of 16,795 pesos, while those in the highest decile earned 236,095 pesos per quarter.
Demographic changes also contributed to these income trends. The number of household members aged 65 and over increased by 21.3%, while the number of household members under 15 decreased by 24.8%. Household size decreased by 8.5%, and the number of household members aged 15 to 64 decreased by 5.2%.
Transfers, which do not come directly from work activities or rental properties, recorded the greatest growth as a source of income, with an increase of 26.5%. Labor income remains the main source of household income, accounting for 66% of total income.
Regional inequality also persists, with households in Mexico City and Nuevo León earning significantly more than those in Chiapas. Gender inequality persists, with women on average earning 34% less than men between 2022-2024.
Among employed household members, there was a 3.4% decrease during the same period. Despite these shifts, the overall trend in Mexican household income growth and distribution post-2016 remains positive, reflecting a more equitable income landscape.
References:
- National Survey of Household Income and Expenditure (ENIGH) 2024.
- INEGI (2024).
- U.S. Bureau of Labor Statistics (2020).
- Mexican Ministry of Labour and Social Welfare (2023).
- The expansion of formal employment jobs and government social programs were crucial factors contributing to the growth in household income in Mexico, as reported by the ENIGH 2024 survey published by INEGI.
- Despite the positive trends in overall household income growth and distribution in Mexico, significant regional disparities persist, with households in cities like Mexico City and Nuevo León earning significantly more than those in regions like Chiapas.
