One thing many people from the United States and other first world countries think when first visiting Mexico is that everything is very inexpensive. In order to understand this idea better, we took a trip to Cuernavaca’s central market area.  It has everything from toiletries to fruits, vegetables, and meat for sale. In groups, we priced items such as milk, beans, and bananas. These items totaled an average family’s food and basic supplies salary for a week. At first glance, it seemed that these items were very inexpensive and affordable. However, after much calculation and observation, we realized the significant difference between the purchasing power of the US dollar and the Mexican peso.

Students gather together to go to Cuernavaca markets for basic commodities

To better illustrate this, it’s important to take into account the minimum wage in Mexico. According to federal law, one person working a minimum wage jobs makes approximately $88.36 MX pesos per one, nine-hour work day. Needless to say, for each hour of work, one worker will be paid nearly $9 MX pesos each hour; that’s about $4.60 US dollar per day and less than fifty cents per hour. And on a grander scale, that’s $110 US dollars per month and $1,320 US dollars per year. (These calculations are based on the January 2018 currency exchange rate of $19.30 MX pesos per $1 US dollar.)

Though the cost of living is different between both Mexico and the US’s economy, the interesting fact is that the Mexican minimum wage is not a livable income for a basic family – a family consisting of two parents and two children – as defined by the government of the States of Mexico.

 Please consider the chart below.

Cost of Living in Mexico in comparison to USD

Tortillas are essential necessities to the Mexican culture. In place of poor metaphors, tortillas are just important as bread is to the American culture. With a continually rising price, one kilogram of tortillas sat at $15 MX pesos (approximately $0.77 US dollars) in 2017; today it costs $18 MX pesos (approximately $0.93 US dollars). Again, though these numbers seem fairly cheap to those who possess US dollars, for a person working minimum wage in Mexico, to afford one kilogram of tortillas today, he/she must work at least two hours of work. That’s the equivalent of a US minimum wage worker earning the federal wage of $7.25 US dollars paying $14.50 US dollars per kilogram of tortillas (or bread). Please see the chart above to learn more about relevant costs between earnings in Mexico and the United States.