1. 9th Hemispheric Meeting Poverty Reduction and Social Protection Network Employment and Labor Insertion Policies to Overcome Poverty Active Labor Market Policies and Human Capital Development The Mexico case Roberto Flores Lima September 14 th, 2007

2. Contents Evolution of the Active Labor Market Policies Structured Employment Management of Employment Policies and Active Labor Market Policies

3. 1978-1983 1.Evolution of Labor Market Policies

4. 1984-1994 Agreements for Stability and Growth 1987-1994 National Productivity Program 1990-1994 1.Evolution of Labor Market Policies

5. 1995-2000 Agreements for Stability and Growth 1.Evolution of Labor Market Policies

6. Population Serviced and Placed by the National Employment Service’s Labor Pool 1988-2006 100 200 300 400 500 600 700 1988199019921994199619982000200220042006 Thousands ServicedPlaced 1.Evolution of Labor Market Policies

9. Labor Competence Standardization Committees 0 5 10 15 20 25 30 19961997199819992000200120022003 Committees Labor Competence Certifying Bodies 7 5 11 7 2 0 2 4 6 8 10 12 19981999200020012002 Certifying Bodies 53.381 46.787 58 0 10 20 30 40 50 60 Thousands 98-200020012002 Certified Competence Units Certificates 1.Evolution of Labor Market Policies

10. 2001-2006 1.Evolution of Labor Market Policies

11. 2. Structured Employment Structured Subordinate Employees:  written contract;  complementary annual salary and paid vacation;  access to medical care and a 20 to 60 hour working week Structured Employers and Self-employed:  Constituted as commercial societies;  Engaged in education, health or non-profit organizations;  Engaged in independent activities and have premises and an office;  Engaged in independent activities, they have an office or study or facilities; they keep accounting books or SHCP record;  Engaged in independent activities, they do not have premises, facilities nor study, but they do keep accounting books or SHCP record

12. 2. Structured Employment 0% 50% 100% Subordinate Employees by Economic Condition and Sex Total 34.6%32.2%33.2% Women 37.3%27.2%35.6% Men 33.0%35.4%31.6% 1. 2. No 3. 2005 1. Structured; 2. Not Structured; 3 Intermedia te

13. 2. Structured Employment 2005 Type of Economic Condition ManWomanTotal Structured 30.8429.8130.44 Not structured 14.2012.3113.68 Intermediate 15.7611.8714.38 Total 19.9618.9619.62 Subordinate Employees Average Income per hour Equivalent to US $ 2.9. Man-hour wages Manufacture Industry: Mexico US $ 2.7; United States US $ 16.60 and France US $ 11.50 Average schooling years: Structured 11.5; Not structured 7 and Intermediate 8.8

14. 2. Structured Employment 1995 Employers and Self-employed by type of Economic Condition and Sex Not structured 71.5%83.1%76.1% Structured 27.1%16.2%22.7% MenWomenTotal Source: National Occupation and Employment Poll. STPS-INEGI

15. 2. Structured Employment 2005 Equivalent to US$ 3.64 Average schooling years: Structured 11.2; Not Structured 6.9 años ManWomanTotal Structured 43.1626.0838.18 Not Structured 20.9013.7818.25 Type of economical condition Average Income per working hour Employers and Self-employed

16. 2005 2. Structured Employment Distribution curve of remunerations of employed population 0.0 20.0 40.0 60.0 80.0 100.0 % REMUN 0.01.35.010.417.225.635.547.864.0100.0 12345678910

17. 3. Management of Employment Policies and Active Labor Market Policies Policies that encourage coordinated public and private interventions, aimed at supporting gathering spaces based on markets that operate with competitive equity (reduction of credit costs; infrastructure investment; entrepreneurial regulation; reduction of the costs of setting-up and operating companies). Policies that strengthen the acquisition and production capacities of the local markets and coordinate them efficiently with external ones.

18. 3. Management of Employment Policies and Active Labor Market Policies Security and labor regulation schemes that provide enough social support to facilitate productive restructuring that promote the use of the available resources in efficient companies, that will generate constant and paid “work”. (Exceed security only for wage-earning employment) To foster linkage-association between education and productive sectors in all education, instruction and training plans to favor: a) investment in education-instruction-training b) relevance in the education-instruction-training contents c) investment return in education-instruction-training (labor productivity- companies and people)

19. 3. Management of Employment Policies and Active Labor Market Policies Active labor market policies are indispensable for:  succeeding in making the labor market work better and encourage equity;  contributing to make labor placement faster and pertinent;  Encouraging permanent training in the population in order to improve the productive performance of companies and people It is essential to create a new institutionality for the design, monitoring and evaluation of public policies, and to assess their impact systematically and consistently.

20. Thank You