In Mexico, small and medium-sized enterprises (SMEs), primarily family-run businesses, represent 99.8% of all economic units in the country. They are the lifeblood of the national economy, generating 70.7% of formal employment and a staggering 96.7% of informal jobs. Despite their critical role, a deep-rooted structural flaw persists: two-thirds (67%) of these businesses still operate in the informal sector.
Informality is not just a matter of paperwork; it’s a roadblock that prevents millions of businesses from accessing credit, social security, technological innovation, and real growth opportunities. It’s also a vicious cycle that drags down productivity, locks businesses out of global markets, and keeps the country mired in precarious labor conditions.
In the face of this challenge, the National Assembly of Family Businesses and Enterprises (G32) has emerged as a game-changer. Its proposal is clear: to promote a practical, gradual, and sustainable formalization model that acknowledges the day-to-day reality of small businesses rather than drowning entrepreneurs in red tape. At the heart of their vision is the “countertop economy”—those businesses living hand-to-mouth, where the cash register needs to ring just to survive.
G32’s agenda is built on real incentives, tax simplification, and legal certainty. But it also bets on a deeper shift in business leadership: a long-term vision, practical financial education, and a new culture of purposeful entrepreneurship.
Formality, far from being a burden, must be a path to empowerment. It should help professionalize family businesses, open doors to new opportunities, and build a more just and competitive Mexico.
In this context, micro-enterprises—which make up 94% of the total and have a 75% informality rate—are the most vulnerable. They need more than political talk; they need practical tools, business mentors, accessible technology, and genuine support.
G32 champions a new leadership mindset built on values, sustainability, and collective action. Through support networks, public-private partnerships, and training programs, it aims to empower those who sustain the economy from their homes and workshops.
We are at a critical juncture. It’s not enough to highlight the problem; it’s time for decisive leadership and action. Formalization should not feel like a punishment or an unattainable privilege, but like a kept promise of development and fairness.
Informality may be profitable for some, but it is bad for Mexico. It’s an uphill battle that must be tackled with determination. And though it won’t be easy, it is the only path toward a stronger, fairer country with real opportunities for all.
The current reality is painfully clear: being formal in Mexico costs more, carries more risk, and is far more complicated than staying informal. It almost feels as if the current system is designed to discourage playing by the rules. This complexity becomes a breeding ground for corruption, exclusion, and lost competitiveness, punishing those who try to do the right thing.
This is a structural problem. As long as the government doesn’t change its mindset, it will keep applying the same old solutions that only feed the trap of precariousness and keep the real economy—the one in every Mexican household—stuck in neutral.
Behind the informal sector lie entrenched economic interests and bloated regulatory frameworks that benefit a few at the expense of millions. So, if we truly want to “put the poor first,” we must start by putting family businesses first.
Now, more than ever, it’s time to think big for the small.
