The wages for direct labor in Mexico are often determined through annual negotiations between the employer and a labor union. The wages for indirect positions is driven by supply and demand.
Certain companies categorize direct labor by skill set required such as (1) assemblers and fabricators, (2) operators using certain type of machinery, (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 an hour at the time of hire, to $2.33 an hour after 1 year of employment, to $3.19 per hour after several years of being employed within that skill category. Wages and employee benefits vary by region and can often vary within a particular city depending on the location (supply and demand). For the foreign companies that make the payroll, the exchange rate of the Mexican Peso (MXN) will also change the cost.
Hourly employees as opposed to salaried employees are subject to overtime pay which can be double or triple time depending on certain conditions. Mexico’s regular work week is 48 hours (day shift), 45 hours (mixed shift), and 42 hours (night shift).