Título presentación
Social Policy and
Job Creation in Mexico
Gustavo Merino
Deputy Minister of Social and
Human Development
MEXICO
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Mexico finds itself in a demographic transition that demands
continuous and abundant
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creation
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The Economically Active Population will reach 50 million people this year, and
will continue to rise over the coming decades.
•
The country needs to generate approximately 1 million jobs annually.
•
However, in the last few years, the creation of jobs in the formal sector (with
job-linked social security) has fallen short of the 1 million benchmark.
Percentage of the
Population (by age)
Source: CONAPO (National Population Council)
‘01
‘02
‘03
‘04
‘05
Source: Ministry of Finance and Public Credit
‘06
‘07
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More new jobs are created in the informal sector
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• Recent evidence suggests
that the labor market is not
fully segmented and that
costs associated with
formality (taxes and fees)
plus the availability of
alternative social protection
programs may create
incentives for informality and
mobility within sectors (Levy,
2006)
Source: CONEVAL estimates, based on the Mexican Family Life Survey 1992-2006
• However, this does not rule
out that many workers,
especially those with low
skills and education may
have few options for formal
employment
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Insufficient job creation in the formal labor market has
grave implicationsTítulo presentación
• 58% of the population lacks coverage through the social security
institutions
– Social security benefits are linked to formal employment
• Among the self-employed and agricultural workers, over 90% have no
social security and 93% of heads of household in the first income
quintile lack social security.
• Being outside the framework of social security and benefits has
negative consequences such as out of pocket health expenditures and
lack of pensions, that can entrench or exacerbate poverty conditions
• Expansion and creation of new social programs provides protection to
those without social insurance, such as health insurance, child care
options, housing and non contributory pensions for the rural elderly, but
may perpetuate labor market distortions.
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Creating more and better paid jobs is imperative for
poverty alleviation
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• Spreading the benefits of growth requires an approach that simultaneously
Uses targeted social assistance programs to alleviate poverty and increase
productivity while facilitating access to the labor market and economic opportunities
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Source: CONEVAL
Mexico´s New Social Policy Strategy places
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considerable attention
employment opportunities
Mexico just launched a social policy strategy that joins specific social and
economic policies to increase incomes for the poor and promote job
creation and employment
Social Safety
Net
Access to
Basic Social
Rights
Bridges
Economic
Development
and Well-Being
Development of
Basic Capacities
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Development ofTítulo
Basic Capacities
presentación
• Tools that raise individuals’ and families’ productivity and
promote their free and full participation in society.
–
Nutrition: Increase access to food, as well as conditions
that improve nutrition, specifically amongst children and
women of child-bearing age.
–
Education: Implement reforms to guarantee universal
access to quality basic education.
–
Health: Provide universal access to healthcare.
–
Housing and Basic Social Infrastructure: Broaden reach
of existing programs, guaranteeing services for the least
advantaged families.
Examples:
-
Oportunidades, Food support programs (Programa
Alimentario, Leche, Diconsa)
-
Housing programs for the poor (Fonhapo, Conavi)
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Social Safety Net
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• Tools that help individuals throughout the life cycle to
overcome contingencies and situations of vulnerability.
–
Health insurance program “Seguro Popular” to the uninsured
population
–
Aid to families and localities affected by natural disasters.
–
Social and financial assistance to persons in situations of
vulnerability, such as:
•
the temporarily unemployed (Temporary Employment Program)
•
migrant agricultural workers (Programa Jornaleros Agrícolas)
•
senior citizens (Programa 70 y +)
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Bridges
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• Bridges are necessary to ensure that social
development translates into larger incomes and better
well-being of the population
• It requires coordination and actions from both social
and economic policies.
– From Social Policy, actions that strengthen capabilities, raise
productivity and facilitateBrides
access to employment opportunities
– From Economic Policy, conditions conducive to economic
and employment growth
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Social Policies to improve individual earnings
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Social Policy
Improved
earnings
•
Facilitate entry into the labor market
– Access to childcare through the Childcare Center Program
– Information to link job seekers and employers (ex. job banks)
•
Build human capital
- Job training
- High school and university
- Formal certifications for diverse job skills
•
Support for productive projects and self-employment (training, micro-credit etc)
•
Install adequate infrastructure for economic activity (e.g. roads wide enough for
trucks, electricity adequate for powering tools and machinery, rural roads,
telecommunications)
•
Improve urban planning
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Economic Policies to improve individual earnings
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Economic Policy
Improved
earnings
•
Increase flexibility and mobility in labor market and reduce labor costs.
•
Develop and strengthen savings mechanisms and ensure that poor
families can access them.
•
Stimulate competitiveness:
- Administrative and sectoral deregulation
- Effective anti-monopoly policies
•
Create direct and indirect employment through large-scale infrastructure
projects.
•
Promote regional development:
- Encourage companies to establish branches in excluded areas.
- Take advantage of existing competitive advantages and develop new ones.
•
Ensure rule of law and public safety.
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Examples of Successful Policies
• Child Care program: Estancias Infantiles
• Health Insurance: Seguro Popular
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Affordable & Accessible Childcare
Bridge
•
•
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Prior to 2007, childcare options were primarily (and insufficiently) offered
through the social security institutions for affiliated persons or much less so,
through other public institutions in addition to more expensive private services
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In Mexico, two thirds of women report not working for income (vs. 12% of
men).
•
Women workers tend to live in higher income households (although 25%
are poor) because these are households with two earners.
•
Childcare availability can increase women’s participation in the labor force,
and consequently help to tackle poverty.
The new Childcare Center Program (Programa Estancias Infantiles) helps
establish privately run local daycare centers for the children of low-income
working mothers:
•
Subsidizes the creation of such centers by eligible individuals, provides
training for the owner and her assistants and supervises the operation of
the centers to ensure safety and quality care.
•
Helps low income working or students mothers to pay for child care
services with a voucher-like mechanisms that allows choice of day care
center
•
Generates opportunities for employment and self employment
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Affordable & Accessible Childcare
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Bridge
Some results (since january 2007)
Children enrolled
152,272
Working mothers assisted
139,804
Operating child care centers
6,535
Jobs created directly
28,035
In January 2007:
Currently:
29 of 100 beneficiaries lacked
employment
23 of these 29 now have employment
3 of 100 beneficiaries were studying
2 of these 3 beneficiaries have
continued studying while 1 is working
68 of 100 beneficiaries were
employed
Only 3 of these 68 have lost their
jobs
•
97% of beneficiaries are women
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24% report working on their first job. 76% of them were not working
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previously for lack of child-care options
Health Insurance: Seguro Popular
Social Safety Net
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• Seguro Popular is a public health insurance financed through
general revenue, which is free and voluntary, and offers a
specialized package of healthcare services.
• Seguro Popular covers the medical expenses of poor families that
lack alternative sources of social security.
• Seguro Médico para una Nueva Generación, a component of
Seguro Popular, provides health insurance for all children of
uninsured families born after December 1st, 2006.
– Covers all medical procedures for the child, and
– Provides regular Seguro Popular coverage to the other family
members.
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Universal Health Insurance
Social Safety Net
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• The goal by 2010 is universal health coverage, through a
combination of Seguro Popular and the Social Security
Institutes. It is estimated that Seguro Popular will cover almost
50% of the population.
• Seguro Popular currently has over 7 million families registered
as beneficiaries.
• Seguro Médico para una Nueva Generación has 1,000,000
children as beneficiaries.
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Título presentación
www.sedesol.gob.mx
www.presidencia.gob.mx
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