It was recently reported that Mexico’s Gross Domestic Product (GDP) in the third quarter, using seasonally adjusted figures, decreased by 0.3% compared to the previous quarter and by 0.2% compared to the same quarter of 2024. It is concerning that the largest year-on-year decline was in the industrial sector, at 2.9%.
Upon reviewing the original figures, it is noted that the year-on-year change for both the second and third quarters was also -0.1%, marking two consecutive quarters of negative growth. This would traditionally confirm the onset of an economic recession in Mexico. In the first nine months of the year, growth was positive on average, although only 0.1% compared to the same period in 2024. Due to the declining trend in GDP growth, a slight decrease is possible for all of 2025.
In several countries, two consecutive quarters of negative GDP growth are not enough to declare the start of a recession, as other factors are considered, such as job creation, extraordinary but temporary events, etc. Therefore, it is generally accepted that a technical organization or institution should make the determination. In the United States, this responsibility falls to the National Bureau of Economic Research (NBER).
Regardless of the correct definition of a recession for Mexico and who should determine it, the data show a clear trend of lower economic activity in recent years. This contrasts with what is happening in the United States, which is our main international market. Another worrying statistic is the sharp drop in job creation, which translates into an increase in the informal economy. Currently, the number of people in this sector is even greater, and this is serious because they do not pay taxes and have low productivity.
Source: elfinanciero
