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As of October 2020, the economy had shed close to 12.5 million jobs at the beginning of the COVID pandemic, and through September 2020 had recovered 7.9m of them. As we pointed out here, the loss in employment and subsequent recovery has hit low income workers hardest, leading to a sharp rise in the poverty rate. However, there is another salient feature of COVID’s effect on the Mexican labour market: it has been particularly hard on women.

The labour participation rate for men at the beginning of the pandemic was almost twice as high as that for women (76% vs 45%), and yet, through September 2020, women account for close to 60% of the total 4.7m jobs lost. Put differently, the rate at which women have lost their jobs since the start of the pandemic is more than twice that for men. This is partly explained by the nature of the pandemic, of course, and is not specific to Mexico. COVID-19 has hit certain key sectors, such as retail, hotels, and restaurants, where women have a high participation relative to men. Still, this is not a totally satisfactory explanation. Women are also more heavily represented in sectors that should theoretically provide greater job protection against COVID, such as healthcare, education, or government services. Moreover, in the case of Mexico, we see that in an important sector like manufacturing, where both men and women have a similar representation in the work force relative to overall employment, 2.3% of men employed have lost their jobs since March 2020 versus a 10.6% loss for women.

Other indicators confirm just how slanted the labour hit from COVID has been against women in Mexico. By type of employment, the relative fall in jobs has been greater for women across the board, and is particularly pronounced in salaried employment and in the “self-employed” category, a category that in Mexico is largely centered around informal, subsistence activities such as paid domestic work. This is confirmed when we look at employment loss by size of firm, with women dominating the fall in micro-business jobs in both absolute and relative terms. The fall in employment is particularly large for women in non-incorporated firms and in domestic work. By income, women dominate the loss of jobs for those earning less than one minimum wage, but in relative terms the fall in their jobs outstrips that of men in all income levels since March. By hours worked, both men and women have experienced a similar increase in the “temporarily absent category”, but women have witnessed declines in jobs exceeding 15 hours a week greater than those experienced by men.

The rate of unemployment for women stood at a mere 4.5% in September 2020, lower than that for men (5.4%). However, if we include underemployed workers and non-economically active individuals who are willing to work, the rate for women surges to 37.8% versus 27.9% for men. The increase in non-economically active individuals has been particularly marked in this pandemic, partly on account of the decision by INEGI statistical agency to classify workers who are temporarily prevented from undertaking their activities on account of COVID in this category. In this regard, both men and women have been similarly affected, as is the case with the rate of underemployment. However, a much greater number of women have fallen out of the labour force altogether: since March, 1m women have joined the ranks of the non-economically active population who are no longer available for work, versus 166k for men. If we add these workers to the wider unemployment measure above, the rate for females surges to 41.1% versus 30.1% for males.

The social distancing and mobility restrictions imposed by the pandemic have contributed to the loss of female labour employment by deepening some of the social and gender divides that were already present in Mexico. Specifically, the fact that children have had to stay home due to school closures may have forced women more than men to take on a greater share of unpaid, stay-at-home activities. Recall that in Mexico, remote learning is the norm under COVID until a state reaches a code” green” on its mobility traffic light, at which point it is up to each state to decide the timing of its reopening (out of 32 states, only Campeche is in “green light” and it has yet to open its schools). According to a recent ILO report¹, the non-economically active population that reported not being able to work due to stay-at-home responsibilities exceeds 16m for women, versus less than 1m for men. On average, employed women dedicate an average of 9 more hours a week than men in unpaid work taking care of their dependents. By contrast, men dedicate 7.5 more hours a week than women in paid work. Meanwhile, Mexican research tank, IMCO, estimates² that in 2018 women dedicated 64.3% of working hours per week to unpaid work, 33.0% to paid work, and 2.7% to subsistence work, versus 22.3%, 72.4%, and 3.3% respectively for men. The COVID pandemic has only exacerbated this gender divide. At 45.1% in March, women’s labour participation rate in Mexico was already among the lowest in the region, surpassing only those of Guyana, Cuba, and Guatemala. Since then, it has fallen to 40.2% in September, essentially unwinding fifteen years of improved female penetration in the labour market.

We have written extensively about how Mexico’s fiscal response to the pandemic is so far underwhelming: at a mere 0.7% of GDP, it is among the lowest in the world. Moreover, we have pointed out that the decision to channel social spending in the face of COVID through some of the government’s preferred social programs may be sub-optimal. The government’s flagship social programs are centered around additional help for the very poor, the elderly, youth employment, and the agricultural sector, and are therefore not necessarily designed to help those who may have recently lost their jobs, either temporarily or more permanently, nor do they specifically target women. Some states and municipalities have put in place some programs aimed at facilitating credits for female-run SMEs, but their impact at the national levels is likely to be limited. Taking a page from IMCO’s recommendations, one development that could help alleviate the current blow to female employment is a more staggered reopening of schools, allowing states showing greater progress vis a vis the pandemic to reopen earlier. Other recommendations, such increasing work-life balance in the work place, introducing paternity leave, or incentivizing higher education for women, would also contribute to reducing the gender gap present in the Mexican labour market going forward. Lastly, we think that introducing subsidized nursery care that frees women up to work is a game changer, judging from the Chilean experience that saw a 4% increase in the female participation rate following the implementation of such a measure in 2011.

¹See “México y la crisis de la COVID-19 en el mundo del trabajo: respuestas y desafíos”, Feix, Noemi (coordinator), ILO, Oct 2020
²See “Diagnostico IMCO: Mujer la economica pos-Covid” Sep 14, 2020.