Mexico’s federal government announced that the country’s minimum wage will increase by 12% on January 1, 2025. The daily rate will rise to 278.80 pesos (approximately $13.75 USD) across most of the country, and to 419.88 pesos ($20.70 USD) in the northern border free zone.
Labor Minister Marath Bolaños López revealed that this decision was made in agreement with representatives from the business sector, labor unions, and the federal government. President Claudia Sheinbaum emphasized that the monthly minimum wage will reach 8,364 pesos ($412 USD) nationwide and 12,596 pesos ($620 USD) in the border area, far outpacing the expected inflation rate of 4.56% for 2025.
Inflation-Proof and Historically Significant
A constitutional reform passed in October requires minimum wage increases to exceed inflation rates. Sheinbaum noted that this adjustment continues the trend of significant wage hikes initiated during Andrés Manuel López Obrador’s presidency, when the minimum wage tripled from 88.36 pesos per day in 2018 to its current level.
Bolaños added that the purchasing power of minimum wage earners has increased by 135% since 2018. Between 2020 and 2023, Mexico’s real minimum wage gains were the highest among OECD countries, contributing to a reduction in poverty rates.
Currency Fluctuations Affect Dollar Value
Despite the nominal increase, the minimum wage’s dollar equivalent has declined due to the peso’s depreciation. At the start of 2024, the exchange rate provided a daily wage of $14.50 USD, but with the peso currently trading at 20.3 to the dollar, the 2025 wage equates to $13.75 USD.
Economist Gabriela Siller pointed out that this is the smallest percentage increase since Enrique Peña Nieto’s presidency (2012–2018). However, she and other analysts do not expect the wage hike to exert additional inflationary pressure.
Bolaños underscored the government’s commitment to a “fair Mexico for everyone” through shared economic growth. President Sheinbaum criticized previous administrations for their focus on cheap labor, which she described as dehumanizing.
“This government is committed to fair wages and the dignity of workers,” Sheinbaum said, reiterating her goal of annual 12% increases throughout her six-year term.