The issue about productivity has started emerging in Mexico’s surface. After the enthusiasm caused by energetic, telecommunications, labour, taxes or political reforms, reality shows that the country should double its productivity to reach the average annual growth rate of 2,7% that it had over the past 20 years, according to a research leaded by Mc Kinsey.

In spite of the fact that in Mexico operate big companies that have increased their productivity, such companies employ 20% of the entire registered workforce. Most companies do not develop modern management technologies and employ twice the amount of workers.

An excess of regulations and low labour flexibility are incentives to remain being informal, and informality is strictly connected to low productivity.

Costs for creating a formal company are relatively high in Mexico and lack of access to capitals is a barrier on itself.

Such low access to capital restrains the entry of new business and prevents middle size companies from becoming great employers with greater contributions to the GDP.

High costs in electricity, fails in infrastructure and concerns regarding security are others barriers to growth and productivity.

McKinsey said: “Besides making amendments on regulations, Mexico must continue strengthening its business environment to increase its competiveness and provide support to domestic industries’ growth.”

A useful tool to increase productivity by lowering informality, would be to ratify ILO’s Convention 181 about Private Employment Agencies. Using workers provided by such agencies grants several benefits: ensuring formality and legal compliance for workers, flexibility for user companies and quick adaptation to changes.

This ratification would directly impact on productivity, producing social and economic progress.