April 27, 2020 / 4:22 PM / a month ago

Mexico's March jobless rate distorted by coronavirus constraints

MEXICO CITY (Reuters) - Mexico’s unemployment rate fell in March, official data showed on Monday, but experts said the true figure was likely higher than reported due to restrictions on data collection amid tougher measures to prevent the spread of the coronavirus.

Mexico’s unemployment rate in seasonally adjusted terms was 3.3 percent in March, down from 3.7 percent in February.

The headline unadjusted rate in March was 2.9 percent.

Mexico’s national statistics agency INEGI said in its regular statement accompanying the data that it suspended its face-to-face interviews on March 31 until further notice due to restrictions around the coronavirus.

Goldman Sachs analyst Alberto Ramos said the lower-than-expected figure suggested a “serious problem in data collection,” likely caused by fewer in-person interviews.

“We expect the labor market to deteriorate visibly in coming months as we anticipate a sharp contraction of real GDP in 2020,” Ramos said in a report.

Jonathan Heath, one of the five board members of Mexico’s central bank, said on Twitter that the report was not compatible with past data because of the change in methodology.

“Another victim of the sanitary/economic crisis are job indicators, more vital than ever to understand what is happening,” he said.

INEGI said it would soon announce changes to some of its data collection programs, including for unemployment.

Reporting by Daina Beth Solomon; Editing by Dan Grebler

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