Mexico minimum wage up to $10.5 per day, but inflation hits

Mexico declared a 20% increase in the country’s daily minimum wage Thursday.

Starting next year, the basic minimum wage will be 207 pesos, or about $10.50, for an eight-hour day. That’s up from the current level of 172 pesos, or about $8.80 per day.

Stubbornly high inflation, however, is expected to eat into that increase. Inflation, especially for basic goods, ran at an average of about 9% this year, and is expected to continue high next year.

Wages along the northern border, where prices are higher, will be set at 312 pesos, or about $16 per day. The changes announced Thursday will go into effect Jan. 1.

The average wage in Mexico is about 1 1/2 times the daily minimum wage, but many people rely on informal-sector work for extra income.