Strong job growth and falling unemployment point to a tighter job market in Mexico, according to an update on the Mexican economy by the Federal Reserve Bank of Dallas.

Formal sector employment in Mexico — jobs with government benefits and pensions — grew at an annualized rate of 2.9% in March and is up 4.3% year to date (annualized).

The unemployment rate for Mexico was 3.2% in March, down from 3.5% a year earlier.

Looking to the overall economy, Mexico’s gross domestic product grew at an annualized rate fo 4.5% in the first quarter — its highest quarterly growth since mid-2016.