Recruitment Guide for the Mexico
Purpose
This guide aims to ensure that the company goes through the correct recruitment process, ensuring that the company will understand all the things to consider when hiring in Mexico. This guide will serve as a how-to guide for the recruitment procedure in Mexico.Key Takeawayss
- A complete explanation of the things to know before hiring in Mexico
- Places to look for Remote Employees in Mexico
- The Cost of Hiring an Employee in Mexico
- The average salary in Mexico
- Company requirements needed to hire employees in Mexico
Mexico, with a population of about 126,424,000 people, is one of the most populous countries in the world and has the world’s most significant number of Spanish speakers. If your organization wants to expand into Mexico or hire remote workers there, this guide to hiring staff in Mexico will help.
What to Know Before Hiring in Mexico
1. Cultural Differences
Some multinational companies may note that the work culture in Mexico is more personable and friendly than in many other nations. This impacts recruiting processes in Mexico, as it is acceptable, if not encouraged, to ask job candidates about their families, passions, and other personal parts of their lives. It also implies holding business meetings in person whenever possible and making time for private conversation.
2. Language Differences
Over 93% of Mexicans speak Spanish. Some Mexicans speak an indigenous language and English, which is particularly frequent around the Mexico-United States border.
Spanish has more native speakers than English and is second only to Mandarin in the world; therefore, if you are not from a Spanish-speaking country, hiring Spanish-speaking personnel in Mexico can open up new business chances in countries around the world. Remember that Mexican Spanish differs from Spanish spoken in other nations, such as Spain.
3. Employment Contracts
In Mexico, there is no such thing as at-will employment, and employment contracts are required. When you hire someone, whether you write a contract or not, a contract is formed between you and the employee. As a result, you should draft a complete employment contract that includes the employee’s personal information and job specifications.
The duration of the job is one of the most crucial details. Contract lengths are classified into the indefinite, project, and seasonal. Most contracts are unlimited, meaning they do not specify an end date for the job.
It is important to note that Mexican workers are always entitled to their rights under Mexican labor law. Thus any conditions in your contract that contradict these rights will be void. Because there is no unemployment insurance in Mexico, employment contracts are highly significant.
Employees benefit from the contractual arrangement between the employer and the employee. If an employee quickly demonstrates that they are not a good match for the job, you can fire them without repercussions while on probation.
4. Required Leave
Mexico has seven national holidays, plus the eighth day of every six years on election day. Employees have the right to these days off. Furthermore, after one year of employment, businesses must provide their employees with six days of vacation leave. The more vacation days a person should receive, the longer they have worked for the organization. For example, after two years, they should be entitled to eight days of leave, and after eight years, they should be allowed fourteen days.
Employees should get a vacation bonus or prima and their regular wage while on vacation. This bonus must be at least 25% of their regular compensation. On the other hand, employees on sick leave only receive a part of their average wage.
5. Workweek and Minimum Wage
Mexico has three distinct working shifts. When most office workers work the day shift, it is 48 hours a week. Employees are entitled to one day of rest per week, although they may perform the remaining six. Some businesses may condense 48 hours into a week that runs Monday through Friday, or they may request fewer than 48 hours from their employees if they so desire. In Mexico, the average workweek is 45.1 hours.
If an employee works more than 48 hours in six days, you must compensat
Places to Look For Remote Talent in the Mexico
Regional Recruitment Preferences in Mexico
| Location | Jobseekers’ First Recruitment Preference | Jobseekers’ Second Recruitment Preference |
|---|---|---|
| Tijuana | Facebook (67%) | Recruitment point (24%) |
| Monterrey metro area | Facebook (54%) | Online job boards (51%) |
| Saltillo | Facebook (42%) | Newspaper (32%) |
| Querétaro | Social media networks (44%) | Online job board (35.1%) |
| Hermosillo | Newspaper (62%) | Facebook (41%) |
The Cost of Hiring an Employee in Mexico
Hiring new employees in Mexico involves various people’s time, fees, and other costs contributing to the total hiring cost. As you expand into a new country, let’s look at some expenses you may incur during the recruiting and hiring process.
Research
In addition to this guide, you will need to perform additional analysis to determine where in Mexico you wish to create a presence for your firm, the exact legalities that apply to employment practices there, and any requirements specific to your industry.
Legal establishment
If your company is going to be the official employer for your Mexican employees, you must have a legal business entity in Mexico that is registered with the Mexican Institute of Social Security (IMSS) and the SAT. Establishing a branch or subsidiary of your company will cost you money. Hiring agencies: If you use staffing firms or recruitment agencies to assist you in identifying candidates or filter applications, the overall cost of hiring a Mexican employee will increase. Using these services in Mexico, on the other hand, may assist you in identifying competent individuals.
Job boards
Posting your job ad on public or industry-specific job boards can also be costly, while there are several free solutions. While you should post your job ad online, bear in mind that many Mexican job searchers prefer conventional forms of media, so you may also want to run print or radio commercials.
Legal checks
To do a thorough background check in Mexico, you’ll need to engage a private investigator, which might be expensive. Reviewing applicants’ documents and ensuring they have the legal right to work in Mexico might also increase your total cost.
Hiring committee
Internal hiring committees frequently handle various aspects of the hiring process, from defining new job opportunities to selecting the best candidates for those roles. When hiring overseas, members of your hiring committee may be required to fly to Mexico, increasing the entire cost of acquiring employees in Mexico.
Translation
If you are analyzing applications and interviewing people who speak Spanish and that language is not one in which your organization is fluent, you will need to hire a translator. A translator can help with in-person and virtual communication, increasing recruiting costs.The Average Salary in Mexico
As in any other country, the average base pay in Mexico differs significantly across various sectors such as IT, manufacturing, healthcare, and so on.
The salary range is also affected by education level, years of experience, and job type (permanent, contract, or part-time).
After accounting for the considerations above, a Mexican worker typically gets an annual wage of 3,98,400 MXN (Mexican Peso). This corresponds to USD 19,980 per year based on the 2021 exchange rate.
The average monthly pay ranges from 8,410 MXN (lowest national average) to 1,48,000 MXN (highest national average).
Additionally, incomes in Mexico vary from place to city.
The average wage in Mexico City, Guadalajara, and Monterrey is around 44,600 MXN, whereas Cancun is about 38,900 MXN.
The average hourly compensation for a Mexican worker in the manufacturing industry is roughly USD 3.50/hour.
Let us now look at the various facets of Mexico’s average pay.
1. Salary in the Middle
The typical monthly pay in Mexico is 32,600 MXN (USD 1,660).
The median wage is the median value of a group of salaries. This means that half of the working population earns more than the median wage (USD 1,660), while the other half earns less.
2. Increase in Average Annual Salary
Employees in Mexico typically receive a raise in their monthly wage every 18 months (the global average salary rise is 3% every 16 months).
The raise usually is around 8% of their annual wage.
3. Annual Average Increase by Industry
1. Here is the average annual salary growth across industries:
| Industry | Average Annual Increment |
|---|---|
| Banking | 4% |
| Energy | 8% |
| Information Technology | 3% |
| Healthcare | 7% |
| Travel | 2% |
| Construction | 6% |
2. Average Annual Increase as a Result of Experience
Let’s look at the average annual salary rise by experience level:
| Experience Level | Average Annual Increment |
|---|---|
| Junior Level | 3-5% |
| Mid Level | 6-8% |
| Senior Level | 10-15% |
| Top Management | 15-20% |
4. Salary Comparisons Based on Education
Higher education almost always leads to a higher average salary.
According to salaryexplorer.com polls, employees with a Bachelor’s degree make 24 percent more than those with a diploma. Working professionals with Master’s degrees are frequently compensated 29 percent more than those with Bachelor’s degrees.
Furthermore, Ph.D. holders typically earn a rate that is 23% greater than Master’s degree holders. Essentially, the higher a candidate’s pay, the more qualified they are.
5. Salary Information for Various Professions
Here is a breakdown of Mexico’s per capita income by profession:
| Profession | Average Salary (per month) |
|---|---|
| IT Manager | 40,000 MXN |
| Data Analyst | 18,632 MXN |
| Project Manager | 36,594 MXN |
| Business Development | 34,000 MXN |
| Software Engineer | 30,000 MXN |
| Attorney | 33,979 MXN |
| Interior Designer | 22,653 MXN |
| Content Marketing | 19,376 MXN |
| Fashion Designer | 25,305 MXN |
| Customer Support | 15,319 MXN |
| Copywriter | 16,532 MXN |
| Teacher’s Salary | 15,447 MXN |
| Mechanical Engineer | 24,797 MXN |
| Chemical Engineer | 56,632 MXN |
| Marketing Manager | 44,937 MXN |
| Human Resource Manager | 59,475 MXN |
| Receptionist | 12,583 MXN |
| Senior Financial Analyst | 38,249 MXN |
| Chef | 56,174 MXN |
| Solution Architect | 59,649 MXN |
6. Minimum Daily Wage (Minimum Salary Bill)
The minimum wage is the smallest amount an employee can be paid per workday.
The Mexican government voted to raise the daily minimum wage to 141.70 MXN in 2021. (USD 7.10). Previously, the minimum wage in Mexico was 123.22 MXN (USD 6.14).
The 15% rise in the minimum average salary is designed to boost daily wage workers’ purchasing power and align them with worldwide standards. On January 1, 2021, the new national minimum wage law went into force.
Now that we’ve discussed the many characteristics of the average income in Mexico let’s look at how this affects outsourcing to Mexico.
Company Requirements for Hiring Employees in Mexico
Before starting recruiting in Mexico, you must first meet specific legal requirements. The following are some essential items you will require:
A branch or subsidiary: If you wish to establish a legal presence in Mexico, you’ll need to develop either an extension or a subsidiary.
Legal paperwork: All documentation you submit to establish your company legally will be in Spanish, so you’ll need a translation. You should ideally have a Mexican attorney assist you in drafting this paperwork, such as your deed of incorporation. Your documents will also need to be notarized.
Registrations: You’ll need to register your firm with several government authorities, beginning with the Ministry of External Affairs (SRE). You’ll also need to register with the Department of Trade’s National Business Information Registry, the SAT, the IMSS, and the National Workers Housing Fund (INFONAVIT). You may also be required to register with the Foreign Investment Register of the Department of Trade.
Permits: Depending on your branch or subsidiary’s location and industry, you may also need to seek licenses from local governments.