Introduction
Mexico’s proposed reduction of the workweek to 40 hours, as advocated by Mario López Roldan, Director of the OECD Center in Mexico, could potentially make the country more productive and competitive. This move aligns with other OECD economies that have already adopted shorter workweeks.
Current State of Mexican Workforce
Mexico currently faces a significant imbalance between work and personal life, with an average of 38 hours worked per week. This imbalance affects workers’ well-being and happiness, as highlighted by the OECD. Moreover, high levels of exhaustion among Mexican workers hinder their productivity.
Benefits of Reducing Workweek
López Roldan emphasized that a gradual reduction to 40 hours, with regulated and progressive flexibility, could bring substantial productivity benefits. He also mentioned that such reforms in other OECD countries have led to regulating new aspects of the labor relationship, like work-life detachment and salary protection.
Salary Protection
López Roldan stressed the importance of ensuring that salary reductions do not occur alongside work hour cuts. He urged for strict adherence to this principle during the transition period.
Perspective from Mexican Employers
Francisco Martínez Domene, President of the Mexican Association of Human Capital Companies (Amech), views the reduction as a historic opportunity to modernize Mexico’s labor market. He believes it requires strategic vision, multisectoral commitment, and careful execution to yield real benefits for workers, businesses, and the economy.
Potential Benefits for Workers
According to Adecco’s survey, 70% of Mexican workers anticipate improvements in their quality of life and job efficiency. However, the business sector warns of potential economic risks if the reform is not properly articulated.
Potential Risks for Businesses
Small and medium-sized enterprises (SMEs), which constitute 98% of Mexico’s business fabric, could face a 36% increase in costs if they pay overtime or a 22% rise if hiring new personnel. Therefore, careful planning and coordination are essential for the reform’s success.
Recommendations from Adecco
- Gradual and Sector-Differentiated Implementation: Adjustments should occur through staggered timelines, allowing businesses to adapt progressively. For instance, large companies and strategic sectors like manufacturing, agriculture, and financial services could see reductions by 2026, with other sectors following suit over five years.
- Strengthening Tripartite Social Dialogue: Maintain ongoing negotiation through formal spaces where the government, employers, and unions define sector-specific agreements on hours, compensations, and productivity.
- Fiscal Incentives and Financial Support for Companies: Implement subsidies and soft loans, creating a support fund of at least 25 million pesos to cover initial hiring and specialized training costs, especially for SMEs.
- Flexible Labor with Social Protection: Strengthen specialized service companies, enabling them to engage in activities beyond their standard scope to support businesses with unusual workloads and schedules. Encourage hybrid and telework models that allow flexible work distribution, reducing operational costs and enhancing work-life balance.
Key Questions and Answers
- What is the proposed change? The proposed change is reducing the standard workweek from 48 to 40 hours.
- Why is this change necessary? Mexico’s current workweek imbalance negatively impacts workers’ well-being and productivity. Shorter workweeks are common in other OECD economies, contributing to higher productivity and competitiveness.
- What are the potential benefits? Potential benefits include improved worker well-being, increased productivity, and modernized labor market dynamics.
- What are the potential risks? Potential risks include increased costs for businesses, particularly SMEs, and the need for careful planning to avoid negative impacts on productivity.
