| | |  Business News | May 2009 
Mexico May Lose 600,000 Jobs
 EFE
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Concamin, a leading business organization, said Thursday it expects the economy to lose 600,000 jobs this year as a result of the recession and the effects of the deadly swine-flu outbreak.
At least half of the job losses will come in the industrial sector, Concamin President Salomón Presburger said at a press conference.
He said 300,000 permanent positions have already been eliminated since the beginning of this year.
"The collapse of orders coming from the United States and the sudden weakening of domestic demand, associated with the fall in household consumption and business investment, explains the accelerated decline of the industrial sector," Concamin said in a statement.
Mexico's gross domestic product fell 8.2 percent during the first quarter compared with the same period last year, the INEGI statistics office said Wednesday, prompting the Finance Secretariat to issue a revised forecast calling for GDP to contract 5.5 percent in 2009.
The economy will hit bottom by the end of 2009, Presburger said.
Concamin, he said, expects GDP to shrink 6 percent this year "and in the industrial sector in particular, there will be a contraction of between 12 and 13 percent."
The current slowdown is similar to the recession that Mexico suffered in the wake of the December 1994 financial panic known as the "Tequila Crisis," Presburger said.
He urged policymakers to carefully "gauge the magnitude of the current crisis" and take steps to protect the nation's productive capacity and stem even bigger job losses.
"It's urgent that we apply measures to generate more activity in the domestic market, such as increasing government purchases, administrative and fiscal simplification, tax incentives and broadening the tax base," Presburger said.
Concamin's president also suggested that the extent of the damage done to the economy by the flu outbreak, which is blamed for 75 deaths and more than $1 billion in losses, will not become clear until next month at the earliest.
"The present numbers will deteriorate further because we still haven't seen the effect of the epidemic," he said.
The tourism sector - the No. 3 source of revenue after oil exports and remittances - will see income fall nearly 30 percent in 2009 from last year's record figure of $13.29 billion, officials predict, attributing much of the decline to the flu scare. |
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