Alternatively we use the component of fiscal policy

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Unformatted text preview: sponse to the crisis, President Felipe Calderón announced in early January 2009 a National Agreement for the Economy and Employment (Acuerdo Nacional en Favor de la Economía Familiar y el Empleo). The agreement includes 25 activities grouped into five pillars. The activities directly related to labor markets are the following: • • • • • an expansion of 2.2 billion pesos (a 0.02% of GDP) of the Temporary Employment Program (Programa de Empleo Temporal, PET); 2 billion pesos (a 0.02% of GDP) for employment subsidies for exporting firms; extended ability to withdraw funds from retirement accounts for unemployed individuals; extension of coverage of health insurance up to six months after dismissal for unemployed workers and their families; and 1.25 billion pesos (a 0.01% of GDP) for enhancing the employment intermediation services of the Labor Secretary. In addition, the “Acuerdo” announced a national infrastructure program for 2009 of 570 billion pesos (a 5.87% of GDP) in combined investment between the public and private sectors. Some Distribution aspects A preliminary analysis of the Mexican Labor Force Survey (ENOE) allows for a first look at the distributive impact of the recent labor market performance. Sorting employment changes by position of employment and type of economic activity reveals if the patterns in net job creation/destruction are the same across different industries. Manufacturing is the only economic activity that has recorded a net destruction of salaried jobs. It also registers net destruction of all types of non‐salaried jobs. Actually, manufacturing represents more than 60 percent of all the job losses between the fourth quarter of 2007 and 2008 (seeTable 3). All the other activities, with small exceptions, have a different pattern: net job creation of salaried positions and net job destruction of non‐salaried jobs. Very few activities, however, have net employment creation. Even non‐tradable activities as construction register net job destruction. The severity of the impact on the manufacturing sector highlights the international channel of diffusion of the crisis in Mexico. Another piece of the evidence in this regard is the distribution of household income by geographic region. The regions in the north of Mexico (where tradable activities concentrate) have experienced the most severe fall in nominal household incomes. Income losses are registered for households in all quintiles of the distribution in Northern Mexico, whereas in the rest of the country household income losses are mostly concentrated in the bottom quintiles. (see Table 4) 95 Table 3: Distribution of Net job creation by employment position: Fourth quarter 2008 (year‐to‐year) Salaried Non specified Agriculture Power generation and mining Manufacturing Construction Trade and Commerce Restaurants and Hotels Transport and communications Financial and private services Social services Other services Government and diplomatic services Total Employer (2,834) 142,1...
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This document was uploaded on 11/14/2013.

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