Published on 29th November 2018
The Smart Regulation Index (SRI) is based on the responses provided by the members of the World Employment Confederation (WEC) to a survey assessing four indicators: the right of establishment, the right to provide services and contracts, the right to negotiate and the right to contribute to labour market policies.
Mexico scores relatively high in the index, making it onto rank 17 out of 39 countries. On three out of the four indicators measured, Mexico stands above the global average and it scores perfectly regarding regulation on establishing a private employment agency.
The global SRI average is slightly brought down, from a score of 67 to a score of 66.3, due to the low scores of Colombia and Chile. Colombia however scores above average regarding the right to provide services and contracts. The lack of an appropriate regulatory environment is indeed a key concern for WEC members in Latin America and an important area of work for our regional federation, as Miguel Pérez García, President of WEC America Latina and of the Colombian Association for Temporary Work Agencies (ACOSET) explained recently.
Developed in 2011 together with the Boston Consulting Group, and regularly updated since then, the SRI confirms that adopting appropriate regulation on the employment industry helps labour markets to be more efficient and thus helps countries to become more competitive.
Indeed, smart regulation on the employment industry leads to higher job creation, increases labour market participation, lowers youth unemployment levels and overall improves the efficiency of labour markets as corroborated by the strong positive correlation between the SRI and the Competitive Labour Market Indicator by the World Economic Forum.