One of my employees bought house last month, he earns with me 1800 weekly, his wife earns I guess a little less, he bought a 890,000 house, morgaged in 20 years, i don't know how much is he paying monthly but for what he told me, he pays for the mortgage about the same he paid for rent.

the house is 3 bedrooms, kitchen, and garden, a fairly decent one...

most of my employees have houses valued around 290k, the main reason is because their wives doesnt work and they can pull just one infonavit loan.

290k houses are really small, about 80m^2 for what I know. but well, is a brand new house after all.

Where in Mexico is this?

I live in North Mexico, Durango State to be explicit. But this are general laws for all the country, labor laws support workers a lot, there are a lot of government agencies looking for workers right, formerly there is a secretary just for that called Secretaria del Trabajo y Prevision Social. That government arm specializes on checking workers coonditions on a lot of matters, for example there is a revision called "Seguridad e Higiene" where they check if your facilities are right and safe for the workers, they check to if the workers are properly trained. Companies have the obligation to train workers every year, and as an employer you have to fill out forms called DC-1, DC-2... DC-5 and submit via internet where you manifiest the training your workers have, there is anothere revision called "Condiciones generales de trabajo", where they check if all the benefits mandated by law are properly applied, another one called "Revisione de PTU's" where they check another benefits of workers (when you file your taxes once a year in a form called "Declaración Anual" your report your utilities, and you are mandated by law to pay the workers 10% of the utilities)

STPS have a lot of instances, another one is called "Conciliacion y arbitraje", where workers can go and sue you, its basicalle a government dependency made to protect employees. Most of your paper work like resignations, and fired people must be filed against conciliación y arbitraje.

Unions are very strong too.

Anyway, the main problem with Mexico is that most companies are informal (they dont pay taxes), and of course, they dont offer benefits to employees.

It's been a real problem for the country for years, but if you have followed the news, two years ago a lot of reforms have passed namely reforma hacendaria, reforma del trabajo, reforma energetica and well, a lot more.

Basically the government is cornering informal bussinesses in order to make them pay taxes. it's a very difficult time for the country because as you can imagine, being formal and paying taxes is very expensive, and a lot of the news you read about the crisis in Mexico is because of the problems informal bussinesses are having to turn to formal ones. (Oil price is another factor, but well, bad luck for the current president).

As a simple fact, if an employee earns 1000 pesos with me (the money he sees), i pay aroung 700 pesos in taxes, from infonavit (housing plan), imss (healthcare), afore (retirement fund), isn (impuesto sobre nomina), and all the benefits.

It's very expensive to have employees, but I'm happy to see them and to believe their sons have better opportunities than them.

Damn, I love my country.

> I live in North Mexico, Durango State to be explicit. But this are general laws for all the country, labor laws support workers a lot (...)

Thank you. I was mostly curious wrt the housing market :-) Also nice to see some details from the labour market of course!

> As a simple fact, if an employee earns 1000 pesos with me (the money he sees), i pay aroung 700 pesos in taxes, from infonavit (housing plan), imss (healthcare), afore (retirement fund), isn (impuesto sobre nomina), and all the benefits.

Hm, you mean the employee doesn't pay any taxes on that 1000? In other words the total tax rate is ~41%? Or is the corporate tax on salaries ~41%? For comparison, here in Norway, for a given monthly salary X, the employer pays an additional 12% towards holiday pay, and 7.9% in taxes from that total. The employee pays tax on X, usually ~36%. And then there's an additional VAT on goods and services of 25% (12.5% on food).

So given your example of 1000 in take-home pay, X would be 1000/0.64 = 1562, of which 1000+1562 * 0.12 (as vacation pay "tax free" or rather "pre-taxed") = 1188 go to the employee (or rather a pay out of 1000 10 months, "half-tax" for December, and 11000 * 0.12=1320 for the vacation month (give or take, with 5 weeks vacation, the pay for the month with 3 work weeks is subtracted... it's a little complicated).

The employer would pay taxes on 1188 * 0.079~94. So the total taxes on the monthly take home pay of 1000 would be 94+562=656 -- before considering money spent on VAT out of the 1000. But do not that Norway has a progressive income tax, variable tax on other income etc -- so this isn't the entire picture.

So it sounds rather comparable, if I understood you correctly. We also have free health care, school system (primary through college).

[ed: To add: the employer would also have some expenses for insuring the employee in case of job related injury etc, but I can't imagine that is very high on top of the 7.9% -- I'm not actually an employer, so I'm not sure.]