The wages for direct labor in Mexico are often determined through annual negotiations between the employer and a labor union. Additionally, wages for indirect positions are driven by supply and demand.
Certain companies categorize direct labor by skill set required such as (1) assemblers and fabricators, (2) standard machine operators , (4) painters, (5) welders, (6) CNC machine operators, (7) CNC setup technicians, (8) CNC machinists, etc.
For people working as assemblers and fabricators, employer costs can range from $1.60 per hour at the time of hire, to $2.33 per hour after one year of continuous employment. Wages can increase to $3.19 per hour after several years of being employed within a certain skill category. In addition, wages and employee benefits vary by region and can often vary within a particular city depending on the location. For foreign companies processing their own payroll, the exchange rate of the Mexican Peso (MXN) will also change the cost.
Hourly employees are subject to overtime pay that can be calculated at double- or triple-time depending on certain conditions.